Oppenheimer upgraded Advanced Micro Devices (AMD) to an Outperform rating on Monday, assigning a new price target of $600 per share. The move followed a note from analyst Rick Schafer, who highlighted a projected 135% surge in AMD’s data‑center revenue for 2027 and an overall sales growth outlook of at least 80% for the same year. AMD’s stock opened up 1.4% at $455.49, gaining momentum after an 11% intraday jump on the previous trading day.

Data‑center outlook drives the upgrade

Schafer’s model positions data‑center GPUs as the primary growth engine for AMD. He expects the segment to account for 85% of total sales by 2027, with revenue expanding 135% year‑over‑year. The forecast assumes AMD will ship roughly 3 GW of GPU capacity in 2027 and 4 GW in 2028, outpacing its EPYC server‑CPU line, which is still projected to more than double its 2026 revenue. The analyst cites anticipated demand from AI leaders such as OpenAI, Meta, and Anthropic, as well as spending commitments from cloud giants Oracle, Microsoft and Saudi Arabia’s Humain.

Company performance and guidance

AMD’s most recent third‑quarter report showed revenue of $13.38 billion, a 45% year‑over‑year increase and $279 million above guidance. Data‑center revenue rose 97% from a year earlier and 27% from the prior quarter. CEO Lisa Su reiterated the company’s confidence in its growth trajectory, stating that AMD expects sales to rise 80% or more in 2027. The firm also confirmed a one‑year chip cadence, with the MI500 GPU slated for 2027 and the MI600 for 2028.

Analyst consensus and market reaction

Other sell‑side analysts have largely echoed Oppenheimer’s optimism. DA Davidson lifted its target to $600 with a Buy rating, StoneX set a $685 target, and TD Cowen maintained a Buy at $675. Conversely, HSBC held a neutral stance with a $540 target, and RBC kept a sector‑perform rating at the same level. AMD’s stock rose modestly pre‑market, while rival Nvidia fell 5.2% amid a board‑initiated probe into CEO Jensen Huang’s alleged foreign‑intelligence connections.

What to watch next

Investors will monitor AMD’s ability to meet its aggressive GPU capacity roadmap and the rollout of the MI500/MI600 chips. The pace of AI‑related spending by the top five cloud providers, projected to reach $1.3 trillion in capital expenditures by 2027, will be a key indicator of demand. Additionally, any further developments in Nvidia’s board investigation could influence competitive dynamics in the AI‑chip market.