HSBC analyst revises AMD stock price amid ‘less competitive’ AI chip roadmap
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At the time, the market was anticipating Advanced Micro Devices (NASDAQ: AMD) would mount a challenge against Nvidia (NASDAQ: NVDA) in artificial intelligence (AI) chips; an analyst is now cautioning that the firm might not have a competitive edge in the sector. Specifically, HSBC analyst Frank Lee, in an investor note on January 8, downgraded AMD from ‘Buy’ to ‘Reduce’ and slashed the price target from $200 to $110, citing a less competitive roadmap in the AI GPU market. The announcement comes after AMD’s stock has already seen an over 20% correction in the past three months, significantly underperforming the PHLX Semiconductor Index’s 12% decline during the same period. “We now think AMD’s AI GPU roadmap is less competitive than previously anticipated, limiting its penetration into the AI GPU market,” Lee said. Lee expressed concerns over AMD’s ability to penetrate the lucrative AI GPU market, citing lukewarm demand for its MI325 GPU. A key issue is the lower-spec HBM3e memory expected in the MI325, a limitation tied to Samsung’s ongoing production challenges with higher-spec HBM3e modules. While AMD plans to launch its MI350 chip in the second half of 2025, the expert noted that the company’s competitive positioning could remain weak until the launch of its MI400 chip, expected in late 2025 or early 2026. Without a robust AI rack solution to rival Nvidia’s NVL platform, AMD may struggle to capture market share in AI-driven data center solutions. Beating Nvidia’s dominance These projections come when industry leader Nvidia is flying high after CEO Jensen Huang unveiled the company’s future technologies. During his CES address, Huang outlined Nvidia’s lead in AI, unveiling new GeForce GPUs and Project Digits for advanced AI tasks. He envisioned a future with 1 billion robots, 10 million factories, and 1.5 billion autonomous vehicles, all powered by…
Filed under: News - @ January 8, 2025 3:27 pm