Goldman Sachs Group Inc (NYSE:GS, ETR:GOS) analysts view Advanced Micro Devices Inc (NASDAQ:AMD, ETR:AMD)’s strategic partnership with OpenAI as “a substantial positive for AMD,” pointing to improved competitive positioning in the accelerator market for both training and inference workloads.
While the firm maintained its ‘Neutral’ rating on the stock “given the potential funding risks tied to the business and likely high customer concentration for AMD’s GPU datacenter business,” it noted that it “could be more constructive if we gain incremental confidence on the revenue stream and execution timeline for this deal in the coming quarters.”
The analysts highlighted that AMD’s participation in OpenAI’s training stack represents a modest challenge to Nvidia, which has “maintained dominant share of OpenAI’s training workloads thus far.”
They also described the partnership as “neutral to modestly positive for Broadcom given the higher expected level of spending and implications for the networking business.”
Goldman Sachs’ financial modeling assumes equal numbers of shares issued for each GW deployed and projects total AMD equity contributions to OpenAI of roughly $75 billion, with potential revenue of approximately $135 billion.
The firm raised its non-GAAP EPS (excluding stock-based compensation) estimates by 21% for 2026 and 62% for 2027, reflecting the expected contribution from the OpenAI partnership.
Analysts cautioned that risks remain. “Significant customer concentration (OpenAI as a % of AMD’s overall revenue is >40% in 2027, per our estimates) and less clarity on OpenAI’s additional funding requirements poses potential execution challenges and likely warrants a discount to this revenue stream,” they wrote.
They also highlighted upside and downside scenarios, noting that key upside risks include “increased traction for AMD GPUs; better-than-expected share trends for x86 architecture in servers; stronger opex leverage,” while downside risks involve “lower-than-expected traction for AMD GPUs; higher-than-expected share loss in Server CPUs.”
Based on its revised estimates, Goldman Sachs raised its 12-month price target for AMD to $210 from $150, citing a higher multiple applied to normalized EPS.
Shares of AMD traded hands at about $233 on Thursday afternoon, up almost 50% in the last month driven by investors' enthusiasm for AI.
At the time of the announcement, AMD was trading near $203.71, implying a modest upside of 3.1%.
The analysts concluded that the partnership is “a strong positive for AMD’s long-term GPU business momentum.”