After 130% Surge, AMD Faces Uncertain Road Ahead: Top Analyst Says Chipmaker’s Future Shrouded In Doubt
Advanced Micro Devices Inc. (NASDAQ:AMD) shares experienced a significant surge in 2023, driven by the increasing demand for graphics processing units (GPUs) used in artificial intelligence (AI) applications. However, the stock’s future trajectory has now been thrown into uncertainty as an analyst downgraded AMD’s rating to a rather unconventional status.
What Happened: The Northland Capital Markets analyst Gus Richard downgraded AMD’s rating to a “heck if we know” status, citing the uncertainty surrounding the future of the company’s AI-oriented GPUs, CNBC reported on Monday. This downgrade comes after AMD’s stock rose by nearly 130% in 2023, with investors banking on the company’s AI-oriented GPUs to rival those of Nvidia Corp. (NASDAQ:NVDA) and attract major buyers like Microsoft Corp. (NASDAQ:MSFT) and Meta Platforms Inc. (NASDAQ:FB).
Richard’s decision is based on the “irrational exuberance” surrounding the growth of AI chip demand, which has led to inflated expectations. He predicts a total AI chip revenue of $125 billion in 2027, with some analysts estimating it to be as high as $400 billion. However, Richard believes that …
Full story available on Benzinga.com
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