Wall Street Bullish on AMD Ahead of Quarterly Earnings Release

As Advanced Micro Devices (AMD) approaches the publication of its Q4 2025 financial results on February 3, a wave of optimism from market analysts has bolstered confidence in the semiconductor firm's strategic position. This sentiment persists despite emerging competitive pressures from major technology companies developing in-house chip solutions.

In recent days, several influential Wall Street firms have issued positive research notes, upgrading their price targets for AMD shares.

• UBS raised its target to $330 from $300 on January 26, maintaining a "Buy" rating.
• Loop Capital increased its price objective to $310, up from $290.
• KeyBanc upgraded the stock to "Overweight" with a $310 target.

UBS analyst Timothy Arcuri cited AMD's strengthening competitive edge and anticipates further client announcements related to its OpenAI partnership throughout the year. KeyBanc's assessment highlighted dominance in the data center segment, noting that AMD's server CPU supply for 2026 is nearly fully allocated. The firm suggested that capacity constraints could even lead to price increases of 10-15% in the first quarter.

Microsoft's In-House Chip Presents a Competitive Landscape

The bullish narrative encountered a brief setback on January 26 when Microsoft unveiled its proprietary Maia 200 AI accelerator chip. AMD's stock declined 3.3% following the news. Manufactured using Taiwan Semiconductor's 3-nanometer process, the Maia 200 is reported to deliver 30% greater performance than rival products at a comparable price.

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This development underscores a broader industry trend where hyperscale cloud providers, including Microsoft, are designing their own semiconductors to reduce reliance on external suppliers. Microsoft plans to offer Maia 200 capacity for rent to its Azure cloud customers. Nevertheless, demand for third-party chips remains robust, with large-scale AI initiatives like OpenAI continuing to utilize external accelerators.

Financial Performance and Market Expectations

For the fourth quarter of 2025, consensus analyst estimates project earnings per share of $1.11, representing a 26% year-over-year increase. Looking further ahead, experts forecast AI-specific revenue for full-year 2026 to reach between $14 billion and $15 billion, driven by sales of the MI355 and upcoming MI455 accelerators.

Bank of America has identified two significant potential revenue drivers: a 1-gigawatt order from OpenAI and a 500-megawatt installation for Oracle. Together, these projects could generate over $20 billion in net revenue for AMD. The company's strong momentum was evident in Q3 2025, where total revenue grew 36% to $9.2 billion, with the data center business expanding by 22%.

Current analyst sentiment remains overwhelmingly positive. Of 45 covering analysts, 30 recommend "Strong Buy," 3 advise "Moderate Buy," and 12 suggest "Hold." The average price target stands at $285. Trading at approximately $254, AMD shares have appreciated more than 130% over the past year. This growth is reflected in a forward price-to-earnings ratio of about 41, which embodies high market expectations and places pressure on the company to deliver continued strong performance.