Will Advanced Micro Devices Join the Trillion-Dollar Club by 2030?

Published: Friday, August 1, 2025 at 10:15 am

AMD's Ascent: Can the Chipmaker Reach the Trillion-Dollar Club?

Advanced Micro Devices (AMD) has emerged as a top-performing chip stock in 2025, experiencing a 48% surge since the year's start. This performance surpasses its competitor, Nvidia, which has seen a 33% increase over the same period. However, despite its impressive growth, AMD's valuation lags significantly behind Nvidia, which recently surpassed a $4 trillion valuation. AMD's current market capitalization is approximately $280 billion, raising the question: can AMD join the trillion-dollar club, and if so, by when?

Several factors suggest a promising future for AMD. The company's growth is accelerating, particularly in the artificial intelligence (AI) chip market. The launch of new AI chips has garnered attention, including endorsement from OpenAI CEO Sam Altman, who is impressed with their specifications. AMD's CEO, Lisa Su, anticipates substantial growth in the data center AI business, projecting annual revenue to reach "tens of billions of dollars" in the coming years, up from $5 billion last year.

For AMD to reach a $1 trillion valuation, it would need to nearly quadruple its current market cap. While the stock trades at a high price-to-earnings ratio, its price/earnings-to-growth (PEG) multiple is only 0.8, indicating potential undervaluation based on future growth projections. Furthermore, while Nvidia has experienced explosive growth in the past five years, AMD's stock has risen at a more modest rate, suggesting that investors may have overlooked its potential.

The success of AMD's new AI chips is crucial. If sales align with the company's and analysts' expectations, there is significant room for the stock to appreciate. The potential for customers to shift to AMD's AI chips, coupled with its high growth rate, could position it favorably in the market.

BNN's Perspective:

AMD's trajectory appears promising, driven by its advancements in the AI chip market. While the path to a trillion-dollar valuation is ambitious, the company's growth potential and current market dynamics suggest a strong investment opportunity. However, investors should remain mindful of the inherent risks associated with the volatile tech sector.

Keywords: AMD, Advanced Micro Devices, chip stock, Nvidia, AI chips, artificial intelligence, market valuation, stock growth, Lisa Su, OpenAI, Sam Altman, trillion-dollar club, investment, growth stock, data center, PEG ratio, earnings, sales, stock, valuation

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