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Key Points
Advanced Micro Devices (NASDAQ: AMD) has secured a deal to supply OpenAI with 6 gigawatts of Instinct graphics processing units (GPUs) starting next year, positioning itself to capitalize on a projected $500 billion opportunity in AI infrastructure. AMD’s data center revenue reached $3.2 billion in the last quarter, marking a 14% increase from the previous year, with AI products comprising 42% of the company’s total revenue.
AMD is experiencing a significant rebound in its stock following earlier declines, with analysts forecasting that its earnings per share will grow at an annualized rate of 39% over the coming years. The focus on AI workloads is shifting from training to inferencing, where AMD’s Instinct GPUs are designed to lead in performance, allowing the company to realize substantial profits as demand rises.
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