FX168 Financial News Agency (North America) reported on Tuesday (November 11) that Lisa Su, CEO of Advanced Micro Devices (AMD), stated that driven by "unlimited demand for AI chips," the company’s overall revenue is expected to achieve an average annual growth rate of approximately 35% over the next three to five years.
Lisa Su pointed out that this growth will mainly come from AMD's artificial intelligence data center business, with the segment projected to maintain an average annual growth rate of about 80% over the next three to five years, potentially reaching tens of billions of dollars in sales by 2027.
Lisa Su stated at the analyst conference: "Based on our current strong momentum of collaboration at the client level—including both publicly announced partners and new clients with whom we are working closely—we believe the company has this growth potential."
AI Data Center Business Becomes Growth Engine
Lisa Su further noted that AMD is expected to achieve a double-digit market share in the global AI chip market for data centers within the next three to five years.
Following the announcement, AMD shares fell by approximately 3% in after-hours trading. However, when the company simultaneously announced that its gross margin would remain in the range of 55% to 58% over the coming years (better than market expectations), the stock rebounded temporarily.
Currently, NVIDIA almost monopolizes the AI chip market, holding a market share exceeding 90%. NVIDIA's market capitalization has surpassed $4.6 trillion, while AMD's market capitalization stands at approximately $387 billion.
Seizing the Capital Expenditure Boom in AI Data Centers
This marks AMD's first Financial Analyst Day since 2022. As global data centers ramp up spending on AI computing power, AMD is at the heart of the wave of AI hardware investments.
Global technology companies are investing hundreds of billions of dollars in purchasing graphics processing units (GPUs) to support artificial intelligence applications such as OpenAI's ChatGPT. To expand computing capacity and reduce costs, enterprises are actively seeking alternatives beyond NVIDIA, and AMD is the only other major GPU developer in the market.
In October this year, AMD announced a long-term cooperation agreement with artificial intelligence company OpenAI to supply Instinct AI chips worth tens of billions of dollars over the coming years. The first batch of deliveries is expected to commence in 2026, with the chips' power consumption reaching up to 1 gigawatt (GW) at that time.
According to the agreement, OpenAI may eventually hold approximately 10% of AMD's equity.
At the conference, Lisa Su also emphasized long-term supply cooperation agreements with Oracle and Meta Platforms.
By 2025, AMD’s stock price has doubled within the year. OpenAI is also assisting AMD in developing its next-generation Instinct MI400X AI chip system, which will officially begin shipping next year.
Technological Breakthrough: 'Rack-Scale' System with 72 Chips Working in Tandem
AMD stated that its AI chips will be capable of being assembled into a 'rack-scale' system, enabling 72 chips to work together to meet the training demands of large AI models.
If AMD succeeds in this architecture, it will catch up with NVIDIA, which has been offering rack-scale AI system capabilities across three consecutive product generations.
Lisa Su predicts that by 2030, the annual size of the global AI data center components and systems market will reach USD 1 trillion, with an annual compound growth rate of approximately 40%.
AMD recorded USD 50 billion in AI chip sales in the fiscal year 2024, far exceeding the company’s previous estimate of a USD 500 billion AI chip market size by 2028.
Notably, AMD’s latest market forecast also includes central processing units (CPUs), which, although not AI accelerators, remain essential core components of AI systems.
Traditional businesses also maintained strong growth.
Currently, AMD's Epyc series CPUs remain the company's primary revenue source, with this product line mainly competing against Intel and some Arm-based processors. AMD also produces gaming console chips, networking components, and other devices.
Although the focus of the day's presentation was on AI business, Lisa Su emphasized that the company’s traditional businesses have also performed impressively:
Lisa Su stated, "We want investors to understand that every business outside of AI is moving forward at full speed, and this is a very ideal state for AMD."
