Wedbush analysts believe Advanced Micro Devices Inc (NASDAQ:AMD, ETR:AMD) has provided future certainty around graphics processing unit (GPU) demand following newly announced agreements that promise to substantially lift the company’s future GPU revenues.
In a note Wednesday, the analysts raised their target price on AMD to $270 per share from $190, while reiterating their ‘Outperform’ rating on the stock, based on the company’s likely revenue path over the next few years.
AMD and Oracle announced an agreement recently, in which Oracle will begin an initial deployment of 50,000 AMD MI450 chips in the third quarter of 2026, with that deployment expected to scale further in 2027.
AMD also inked a partnership deal with OpenAI to deploy 6 gigawatts (GW) of AI capacity using AMD solutions.
The analysts anticipate that each GW of capacity will likely require about $20 billion worth of AMD products, which would potentially “dwarf” their previous estimates of about $20 billion for 2026 and 2027 combined.
As a result, Wedbush analysts have increased their earnings per share forecast for AMD to $9 in calendar year 2027 from $5.81 in fiscal year 2026.
AMD stock climbed more than 8% to $235.90 in midday trading on Wednesday.