HSBC has upgraded its rating for AMD (AMD, Financial) from "hold" to "buy" and significantly raised its target price from $100 to $200. This decision is driven by the bank's optimistic outlook on AMD's growing AI GPU product line. Analyst Frank Lee highlights that AMD's next-generation MI350 series chips have a notable pricing advantage over NVIDIA's competing Blackwell B200 chips.
According to Lee, the average selling price for the MI355 chip could reach $25,000 per unit, a substantial increase from the previous estimate of $15,000. This price surge is expected to significantly boost AMD's AI business revenue for the fiscal year 2026, prompting a market reassessment. Despite a 14% increase in AMD's stock price since its AI day event, Lee believes the market has yet to fully appreciate this potential.
HSBC emphasizes that the premium pricing advantage, along with the plug-and-play compatibility of the MI350 with existing data centers, will be crucial for AMD to reclaim market share from NVIDIA's near-monopoly in the AI GPU sector. AMD CEO Lisa Su has reiterated the company's commitment to an open ecosystem, supporting all major frameworks and offering comprehensive solutions for easier and cost-effective AI hardware deployment.
HSBC is also eyeing the upcoming MI400 series as a potential catalyst for further AI revenue growth. Overall, the bank believes AMD's strong entry into the AI chip market is just beginning, and Wall Street is about to recognize this.
