Advanced Micro Devices (AMD, Financial) sees a downgrade from Wolfe Research, which warns of slower data center GPU revenue growth than expected. Shares tick up slightly in premarket trading.
Wolfe analyst Chris Caso lowers AMD's rating to Peer Perform from Outperform and removes his $210 price target. He cites original design manufacturer (ODM) build plans that point to modest quarterly growth in 2025. Wolfe now forecasts $1.5 billion to $2 billion in data center GPU revenue for Q4 2024, with $7 billion for 2025, well below prior estimates of $10.8 billion and buy-side expectations of $10 billion.
Caso also sees weak PC demand, gaming softness, and no embedded recovery in the first half of the year. Still, he highlights AMD's upcoming MI350 AI accelerator as a major catalyst, calling it a significant redesign over the MI325 as the new chip launches later this year.
