AMD’s Bold AI-Driven Growth Strategy Unveiled at Financial Analyst Day

AMD (AMD) has set ambitious long-term financial targets, including a revenue compound annual growth rate (CAGR) exceeding 35% and adjusted earnings per share (EPS) surpassing $20. The company’s strategy hinges on dominating the $1 trillion compute market through AI and high-performance computing, with a focus on data centers, embedded systems, and gaming. Shares surged 4.5% in after-hours trading following the announcement.

CEO Dr. Lisa Su emphasized the company’s 'new era of growth,' driven by cutting-edge technology and accelerating AI adoption. AMD aims for a free cash FLOW margin above 25%, an adjusted operating margin over 35%, and gross margins between 55% and 58% within three to five years.

Market share ambitions include capturing over 50% of the server CPU market, 40% of client revenue, and 70% of the embedded segment. The data center business is projected to grow at a 60% CAGR, with specific products targeting even higher gains.