Advanced Micro Devices (AMD) is witnessing a wave of bullish upgrades from Top Wall Street analysts following its blockbuster deal with OpenAI (PC:OPAIQ). This deal has the potential to reshape the AI hardware market and boost AMD’s earnings power over the next five years. On Monday, AMD stock surged more than 30%, marking its biggest single-day gain in nearly a decade.
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Under the agreement, AMD will supply 6 gigawatts of computing capacity to OpenAI over the next several years, starting with a 1-gigawatt rollout in 2026. The deal includes performance-based warrants that could give OpenAI up to a 10% stake in AMD, contingent on the stock hitting financial milestones.
Price Targets Surge as AI Revenue Outlook Expands
Following the deal announcement, Truist Securities analyst William Stein raised his price target to $273 from $213. Stein noted that OpenAI’s deal is proof that AMD is now being considered as a partner in AI and data center infrastructure, rather than as a backup option used for price comparisons against Nvidia (NVDA). As a result, the analyst raised AMD’s 2027 earnings forecast from $7.89 to $9.25 per share.
Similarly, Bank of America’s Vivek Arya bumped the target to $250 from $200, estimating the deal could be worth over $100 billion. He believes that the OpenAI deal adds to other major agreements AMD made earlier this year with Middle Eastern governments or sovereign entities.
At the same time, Barclays analyst Tom O’Malley lifted his target to $300 from $200. He projects the deal could add $4.5 billion in quarterly revenue and $3 in quarterly EPS by 2030, assuming linear deployment of the 6GW capacity. Also, the analyst expects $15 billion in incremental revenue as early as 2026.
Strategic Win for AMD
The market is treating this deal as a turning point for AMD. It positions the company as a credible alternative to Nvidia in the race to power next-gen AI workloads. CEO Lisa Su said that the deal has the potential to generate “well over $100 billion in revenue” in total over the next few years.
For OpenAI, the move diversifies its supplier base and reduces reliance on Nvidia, whose chips are in high demand and short supply.
Importantly, the analysts’ bullish revisions reflect growing confidence in AMD’s ability to scale its AI infrastructure business and compete in the AI infrastructure market.
Is AMD a Buy or Sell Now?
Turning to Wall Street, AMD stock has a Moderate Buy consensus rating based on 22 Buys and 13 Holds assigned in the last three months. At $193.03, the average AMD price target implies a 6.18% downside risk.
