William Blair starts AMD at Market Perform, sees balanced risk-reward

Investing.com -- William Blair started coverage of Advanced Micro Devices with a Market Perform rating in a note from analyst Sebastien Naji on Thursday.

The firm said AMD is positioned as a major beneficiary of the AI infrastructure boom, with compute demand accelerated by more advanced models and the rise of inference and agentic use cases.

William Blair estimated AMD's sales growing from $52 billion in 2026 to over $104 billion in 2028, with non-GAAP earnings per share approaching $20 in 2028.

Despite that growth potential, William Blair said AMD's graphics processing unit business remains "an uphill battle" against Nvidia, noting that while AMD "has done a commendable job of accelerating its product roadmap," competition from Nvidia and an expanding set of hyperscaler ASIC programs is likely to constrain meaningful share gains.

The firm also said the "era of easy CPU share gains is ending" for AMD, citing unprecedented competition from the Arm ecosystem as hyperscalers, Nvidia, Qualcomm and Arm itself offer their own CPUs.

William Blair added that Intel is "starting to show signs of improvement," though it will likely take about two years before Intel can compete effectively with AMD.

AMD shares trade at 33 times William Blair's 2027 earnings estimate, a slight premium to the peer group median.

The firm believes this valuation properly reflects the balance between strong AI computing demand and risks, including competition, supply tightness, and a potential slowdown in AI spending growth.

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