To The Moon

As an investor closely tracking the tech sector, I am highly optimistic about AMD (Advanced Micro Devices) following its performance on October 7, 2025, and its long-term prospects. Today’s stock price surged to $203.71 (up 23.7% from yesterday’s $164.67), hitting a 52-week high of $226.71. This impressive rally is no fluke—it’s driven by a landmark partnership with OpenAI.

Unmatched Partnership Potential

The cornerstone of today’s surge is AMD’s multi-year agency agreement with OpenAI, which involves deploying up to 6 gigawatts (GW) of AMD Instinct MI450 GPUs, with the first 1 GW rolling out in the second half of 2026. This deal could unlock hundreds of billions in infrastructure orders (estimated at $50B per GW) and includes OpenAI securing options for 160 million AMD shares (approximately 10% equity, contingent on milestones). Analysts forecast this will propel AMD’s 2025 revenue from $33.02B to $40.19B in 2026, with EPS rising to $3.90 and $6.03, respectively, reflecting explosive AI chip demand.

Solid Fundamentals Fuel Long-Term Growth

AMD’s financial health provides a robust foundation for this growth. Q2 2025 revenue reached $7.7B (up 32% year-over-year), with its data center business (EPYC CPUs and Instinct GPUs) leading the charge. With a cash reserve of $158.1M supporting operations through 2027, and no debt (debt-to-equity ratio 0%), AMD is well-positioned. Its P/S ratio of 6.0x and P/B of 1.9x remain reasonable, especially amid the AI boom.

A Chance to Outshine NVIDIA

This partnership challenges NVIDIA’s dominance in the AI chip market, particularly its software ecosystem. With cost-effective Instinct GPUs (performance comparable to NVIDIA’s A100 at a lower price point) and OpenAI’s endorsement, AMD is poised to capture significant market share. Discussions on X suggest institutional funds may shift from NVIDIA or cryptocurrencies to AMD, positioning it as the next dark horse in the AI revolution.

Risks and Mitigation

While short-term volatility is evident (with today’s trading volume spiking), risks like export controls (e.g., China market) and clinical failure warrant caution. I believe AMD can mitigate these through diversified clients in automotive and gaming sectors.

Conclusion

AMD’s current valuation offers an attractive entry point, with long-term potential fueled by global AI infrastructure spending (projected at $4 trillion annually). I am bullish on its growth from 2026 to 2030, with a potential target price exceeding $300. I recommend buying on dips and monitoring data updates by late 2025. This is not just a price surge—it’s the start of a technological transformation!