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AMD Shares Jump After Company Sets $100 Billion Data Center Revenue Target

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Advanced Micro Devices (AMD) saw its shares climb nearly 5% in premarket trading on Wednesday after the company unveiled ambitious long-term growth goals, including a plan to reach $100 billion in annual data center revenue within five years by taking a larger share of the booming AI chip market from rival Nvidia.

Speaking at an investor event in New York, CEO Lisa Su said AMD expects the market for data center chips to expand to $1 trillion by 2030, driven by AI adoption and stronger software integration.

To capitalize on that opportunity, AMD is preparing to roll out its next-generation MI400 chips and the Helios rack system in 2026. These products are part of the company’s broader strategy to compete more aggressively in AI computing, an area dominated by Nvidia.

“AMD’s success will come from being better than NVIDIA on whatever metrics matter most to customers,” analysts at Morgan Stanley said, adding that factors like power efficiency, component availability, and performance will determine leadership in what they called a “winner-takes-most” market.

At the event, AMD projected 35% annual growth for its overall business and 60% annual growth in its data center segment over the next three to five years. Chief Financial Officer Jean Hu said the company also aims for earnings of $20 per share within that timeframe, compared to LSEG’s 2025 estimate of $2.68 per share.

While analysts praised AMD’s bold targets, some cautioned about execution challenges, potential AI spending slowdowns, and supply chain constraints.

AMD shares have already gained 97% this year and are up 16% since October 6, when the company announced a partnership with OpenAI.

AMD Unveils AI Server and Chips as OpenAI Joins Development Effort

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AMD CEO Lisa Su introduced a major new line of AI hardware on Thursday, unveiling both the MI350 and MI400 series of AI chips and announcing plans to release the company’s first AI server, called “Helios,” in 2026. The launch signals AMD’s most direct challenge yet to Nvidia’s dominance in the AI server and chip market.

The announcement was made at AMD’s “Advancing AI” developer conference in San Jose, California. The Helios servers will house 72 MI400 chips, designed to compete directly with Nvidia’s current NVL72 servers powered by its Blackwell processors. In a notable difference from Nvidia’s closed ecosystem, Su emphasized that many aspects of AMD’s server and networking standards would be openly available to the broader industry, including rivals like Intel.

“The future of AI is not going to be built by any one company or in a closed ecosystem. It’s going to be shaped by open collaboration across the industry,” Su stated.

Su was joined on stage by OpenAI CEO Sam Altman, who confirmed that OpenAI is already working with AMD on its MI450 chips to help optimize them for AI workloads. Altman remarked on OpenAI’s rapid infrastructure growth, calling the pace “crazy” and noting continued expansion with AMD’s hardware.

Executives from Meta Platforms, Elon Musk’s xAI, and Oracle also appeared during the event to showcase how their companies are adopting AMD’s processors. Additionally, Crusoe, a cloud provider specializing in AI, disclosed plans to purchase $400 million worth of AMD’s new chips.

Despite the announcement, AMD shares slipped 2.2%, with analysts suggesting the company still faces significant headwinds in dislodging Nvidia’s dominant market position. Summit Insights analyst Kinngai Chan noted that the newly announced products are unlikely to shift the competitive balance immediately.

AMD has aggressively expanded its AI capabilities over the past year, completing its acquisition of server manufacturer ZT Systems in March and making 25 strategic investments in AI-related startups. The company recently hired engineers from Untether AI and Lamini, further strengthening its chip design and software development teams.

However, AMD’s ROCm software stack continues to lag behind Nvidia’s highly entrenched CUDA platform, which many in the industry see as a major factor behind Nvidia’s dominance.

Nevertheless, AMD remains optimistic about its growth prospects, even as U.S. export controls tighten on AI chip sales to China. When reporting earnings in May, Su reiterated expectations for strong double-digit growth in AI chip sales despite these headwinds.

AMD Launches $6 Billion Buyback Amid AI Sector Jitters, Shares Jump

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Advanced Micro Devices (AMD) announced a $6 billion stock buyback plan on Wednesday, signaling confidence in its long-term strategy despite recent underperformance in the AI chip race. The announcement triggered a 6.4% rise in AMD shares, though the stock remains down over 6% year-to-date.

The new buyback adds to AMD’s existing authorization, bringing the total repurchase capacity to $10 billion. The move follows similar shareholder-pleasing strategies by major semiconductor rivals amid signs that the AI-driven chip boom may be plateauing.

“Our expanded share repurchase program reflects the Board’s confidence in AMD’s strategic direction, growth prospects, and ability to consistently generate strong free cash flow,” said CEO Lisa Su.

📉 Context: Market Pressure and AI Uncertainty

  • AMD shares are down 6% in 2025, compared to a <1% drop for the Philadelphia Semiconductor Index.

  • In contrast, rivals have surged:

    • Nvidia shares: ↑170% in 2024

    • Broadcom shares: Doubled in value

    • Qualcomm announced a $15B buyback in November

    • Broadcom initiated its own $10B repurchase in April

🤖 AI Competition Heats Up

Despite being seen as Nvidia’s top rival in AI computing, AMD faces mounting pressure:

  • Custom processors from hyperscalers threaten AMD’s general-purpose AI chips.

  • Concerns are emerging over AMD’s ability to keep pace with Nvidia’s entrenched ecosystem and rapid innovation cycles.

  • The $10 billion AI collaboration with Humain, announced just a day prior, indicates AMD’s intent to catch up through strategic alliances.

💰 Financial Snapshot

  • Free cash flow in Q1 2025: $727 million, down 33% YoY.

  • Cash & equivalents (as of March 29): $6.05 billion

  • Current liabilities: $7.70 billion

While the cash cushion and buyback authorization underscore AMD’s longer-term confidence, its short-term financial metrics highlight margin pressures and investment demands as it expands into custom AI and datacenter segments.

🧭 Strategic Implications

AMD’s buyback aims to:

  • Support share price amid volatility

  • Reinforce investor confidence in AMD’s AI ambitions

  • Signal resilience in an increasingly cutthroat chip sector

As investor sentiment wavers on AI-related tech, AMD’s aggressive buyback and global partnerships could be pivotal in defending market share and reaffirming its place in the AI arms race.