Advanced Micro Devices’ (NASDAQ:AMD) multi-year partnership with OpenAI could generate over $100 billion in revenue over the next four to six years, as the chipmaker prepares to supply up to six gigawatts of computing capacity using its next-generation Instinct MI450X GPUs starting in late 2026.
The deal strengthens AMD’s position in the AI hardware race against Nvidia (NASDAQ:NVDA) and Broadcom (NASDAQ:AVGO), with OpenAI’s massive infrastructure buildout expected to drive demand across the broader semiconductor, networking, and data center ecosystem.
Bank of America Securities analyst Vivek Arya maintained a Buy rating on AMD and increased the price forecast from $200 to $250.
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Arya said AMD’s new multi-year deal with OpenAI could generate over $100 billion in revenue across the next four to six years, marking one of the most transformative opportunities in the AI hardware landscape.
Earlier this week, AMD announced an agreement to deliver up to 6 gigawatts (GW) of computing capacity to OpenAI, starting in late 2026, the analyst noted. The deployment will use AMD’s next-generation Instinct MI450X GPUs and related rack-scale infrastructure under its Helios platform, he said. In return, OpenAI will receive performance-based warrants for up to 160 million AMD shares, investing in tranches tied to share price targets with the final tranche triggered if AMD stock reaches $600 per share, Arya noted
The analyst estimated that each gigawatt of capacity could generate roughly $17.5 billion in revenue, translating to more than $100 billion across the whole deployment. He projected 30–35% EBIT margins and noted that every 1 GW of incremental revenue could add $0.67–$2.65 per share in annualized EPS by 2026–2027. By 2030, AMD could deliver earnings power exceeding $15 per share with full 6 GW deployment and a 35% margin assumption.
Arya said the OpenAI partnership adds significant incremental upside to AMD’s previously signed sovereign deals in the Middle East. The analyst highlighted that AMD’s success positions it as a growing rival to Nvidia and Broadcom, both of which have also struck major AI infrastructure agreements with OpenAI. Nvidia’s deal, valued at around $100 billion, involves 10 GW of deployment for its Vera Rubin systems starting in 2026, he said.
Arya emphasized that OpenAI remains the most disruptive player in generative AI cloud computing, and its expanding infrastructure will drive a “rising tide” across the semiconductor supply chain — benefiting chip, memory, networking, and foundry partners. The analyst added that OpenAI’s ambition to deploy over 200 GW of compute capacity in the coming years underscores the early stage of the AI buildout.
While acknowledging potential investor concerns over a future capacity glut, Arya said that constraints such as data center space, power access, and advanced chip cycle times will naturally regulate expansion.
Arya projected 2025 sales of $32.88 billion and EPS of $3.85.
Price Action: AMD stock was trading 3.39% higher at $210.55 as of the last check on Tuesday.
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