Why can AMD beat Nvidia and Broadcom in 2025?

What logic is behind this market trend?

The big drama of chip stocks in 2025: Nvidia up 39%, Broadcom up 48%, sounds impressive, right? But AMD doubled—up 99%. Especially since October, this company has suddenly gained a strong presence in the AI chip market.

Data speaks: AMD's enterprise-level CPU customer base has surged by 60%, and the number of new customers has doubled. This is not hype; it is real Fortune 100 companies voting with their feet.

Data Center CPU: From Supporting Role to Leading Character

For a long time, AMD has been overshadowed by Nvidia and Intel. But now the situation has reversed.

Key numbers:

• AMD aims to capture 40% of the server CPU market share this year.
• Long-term goal: over 50% market share
• The new generation Venice chip performance has improved by 1.7 times

What does this mean? It means that major cloud computing players like Oracle are starting to deploy AMD processors. The combination of cost advantages and performance upgrades is hard to resist.

AMD's forecast is even more ambitious: by 2030, the addressable market for data center CPUs could reach $60 billion (currently $26 billion). Assuming AMD captures 50% of the market share, that would translate to $30 billion in revenue, which is four times the expected figure for 2024.

GPU Battlefield: Not a Bystander

Don't think that AMD only plays with CPUs. It is also making strides in the data center GPU space.

After the launch of the MI450 series in 2026, there will be a significant leap in performance. Moreover, players like OpenAI, Meta, and the U.S. Department of Energy have already placed orders.

Topline data: Among the top 10 companies on the AI leaderboard, 7 are using AMD's Instinct GPUs. With clients like Tesla and Samsung, the ecosystem is quite extensive.

Can financial expectations support stock prices?

The target released by AMD's management at the analyst meeting:

• In the next 3-5 years, the annual growth rate of data center business will exceed 60%.
• Other businesses (PC, games, embedded) stable growth of 10%
• Overall revenue 35% CAGR
• Non-GAAP earnings per share surge to $20

The expected price in 2024 is $3.94 per share. Soaring to $20 corresponds to an annual growth rate of 38%—this target is not just empty talk, supported by the increase of non-GAAP operating profit margin from 24% to 35%.

Will the stock price continue to soar

This is the problem. Assuming AMD achieves these goals within 3 years (possibly sooner), based on a Nasdaq 100 index valuation of 34 times earnings, the stock price could soar to $680.

This is 2.8 times the current price.

In other words: Although AMD has surged by 99%, there is still considerable room for imagination from a fundamental perspective. However, it is also important to note: these are the management's goals, and effective execution is key.