Key Takeaways
- Susquehanna boosted AMD’s price target to $375 from $300 while maintaining its Positive rating on the stock
- Analyst Christopher Rolland anticipates robust Q1 performance fueled by server CPU growth and MI350 AI chip traction
- AMD secured 6-gigawatt hardware contracts with both OpenAI and Meta, with initial shipments slated for the second half of 2026
- The chipmaker releases Q1 2026 results on May 5; Wall Street forecasts $1.29 EPS and $9.89B in revenue
- Northland countered bullish sentiment with a downgrade to Market Perform and $260 target, highlighting analyst disagreement
Christopher Rolland, an analyst at Susquehanna, increased his price objective for AMD from $300 to $375 this Wednesday, maintaining his optimistic stance just days before the company unveils its Q1 2026 financial results on May 5.
Advanced Micro Devices, Inc., AMD
Shares of AMD climbed approximately 1.6% during premarket hours following the announcement and finished the trading session up about 3.6%.
Rolland’s upgraded target stems from his belief in AMD’s expanding server CPU market share and the accelerating adoption of its AI accelerators. He pointed to ongoing EPYC processor market penetration as Intel grapples with supply chain challenges.
Regarding AI hardware, the MI350 accelerator is projected to bolster Data Center segment revenues throughout the first six months of 2026. Rolland anticipates a more pronounced acceleration in Q4 2026, coinciding with the MI450 and Helios platform debuts.
Two major contracts support this optimistic projection. Both OpenAI and Meta have committed to 6-gigawatt hardware purchases from AMD. Delivery of the initial gigawatt for each company is anticipated during the latter half of 2026. According to Rolland’s calculations, each gigawatt represents approximately $15 billion in potential revenue.
Oracle has separately revealed intentions to construct a 50,000-GPU AI supercomputing cluster leveraging the Helios platform equipped with Instinct MI450 GPUs and EPYC Venice processors.
Factoring in these agreements and the broader market expansion, Rolland projects AMD will achieve $17 billion in GPU-related revenue throughout 2026. He emphasized that income from the OpenAI and Meta partnerships will probably extend into 2027.
Server Processor Demand Remains Robust
Rolland’s recent industry investigations suggest a powerful Q1 with sustained strength ahead. Demand driven by agentic AI applications is characterized as outstanding, while recent pricing adjustments may provide upward pressure on profit margins.
Conversely, PC market demand is projected to underperform typical seasonal patterns in 2026. While this represents a weaker element in AMD’s narrative, the Data Center division continues to serve as the primary growth engine.
AMD finished trading at $323.21 on April 28, representing an approximately 51% gain year-to-date. The shares carry a trailing price-to-earnings ratio of 123x and a forward P/E of 50x — valuation levels that provide minimal margin for operational shortfalls.
Upcoming Q1 Results Under Scrutiny
Analyst consensus projects Q1 earnings of $1.29 per share on $9.89 billion in revenue. AMD’s official guidance targeted approximately $9.8 billion, with a variance range of $300 million, suggesting roughly 32% year-over-year expansion.
That forecast incorporated around $100 million from MI308 shipments to Chinese customers.
AMD’s fiscal 2025 revenue totaled $34.64 billion, representing 34% growth. The Q4 2025 Data Center segment achieved record revenue of $5.38 billion, up 39% compared to the prior year. Annual free cash flow surged 129% to reach $5.52 billion.
The bullish perspective isn’t universally shared. Northland recently lowered AMD to Market Perform with a $260 price objective, creating a significant contrast with Susquehanna’s $375 valuation.
Polymarket participants currently assign a 76% probability that AMD will exceed expectations in its May 5 earnings announcement.
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