AMD likely to get 10% of data center GPU market as AI competition heats up: Citi

AMD (NASDAQ:AMD) is likely to take 10% of the data center GPU market after the company updated its artificial intelligence GPU roadmap in an effort to better compete with Nvidia (NASDAQ:NVDA), investment firm Citi said.

"We believe AMD is using an annual product cadence to keep pace with Nvidia, and we still expect AMD to get 10% share of the data center GPU market or roughly $15.0 billion," Citi analyst Christopher Danely wrote in an investor note. Danely reiterated his Buy rating and $176 price target on AMD.

On Monday, AMD said at the Computex conference that the new MI325X will be available in the fourth-quarter of this year, while the MI350X will come in 2025 and the MI400 in 2026.

Conversely, Nvidia is also releasing its AI accelerators on an annual basis. Nvidia Chief Executive Jensen Huang, who gave the keynote address at the conference, said the company's next-gen Rubin platform would come in 2026.

AMD said earlier this year that it expects at least $4B in AI-related revenue this year, but Danely believes it could be even higher. "We continue to expect more upside over the summer and would buy AMD stock on any weakness," he wrote in the note.

AMD shares fell 2.2% on Tuesday, while Nvidia closed up 1.3%.