Three Competitors to Nvidia Set to Lead the AI Competition
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Oct 31 2025
0mins
Source: Benzinga
Nvidia's Dominance in AI: Nvidia has been a major profit player in the AI market, powering technologies like ChatGPT and Tesla's self-driving systems, but investors are starting to question if its peak performance is already reflected in its stock price.
Shift in AI Investment Focus: Analysts suggest that the next wave of AI investment will favor companies that create recurring revenue models over traditional chipmakers, emphasizing the importance of integration and orchestration in AI applications.
Emerging AI Players: Companies like AMD, Microsoft, and Taiwan Semiconductor are highlighted as potential future winners in the AI landscape, with AMD focusing on efficiency in inference workloads and Microsoft rapidly monetizing its AI integrations.
Long-Term Outlook: While Microsoft is currently investing heavily in AI infrastructure, AMD is seen as better positioned for immediate benefits as the market shifts towards inference, indicating a potential change in the competitive landscape of AI development.
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Analyst Views on AMD
Wall Street analysts forecast AMD stock price to rise
36 Analyst Rating
27 Buy
9 Hold
0 Sell
Strong Buy
Current: 213.580
Low
200.00
Averages
284.10
High
377.00
Current: 213.580
Low
200.00
Averages
284.10
High
377.00
About AMD
Advanced Micro Devices, Inc. is a global semiconductor company. The Company is focused on high-performance computing, graphics and visualization technologies. Its segments include Data Center, Client and Gaming, and Embedded. Data Center segment includes artificial intelligence (AI) accelerators, microprocessors (CPUs) for servers, graphics processing units (GPUs), accelerated processing units (APUs), data processing units (DPUs), Field Programmable Gate Arrays (FPGAs), smart network interface Cards (SmartNICs) and Adaptive system-on-Chip (SoC) products for data centers. Client and Gaming segment includes CPUs, APUs, chipsets for desktops and notebooks, discrete GPUs, and semi-custom SoC products and development services. Embedded segment includes embedded CPUs, GPUs, APUs, FPGAs, system on modules (SOMs), and Adaptive SoC products. It markets and sells its products under the AMD trademark. Its products include AMD EPYC, AMD Ryzen, AMD Ryzen PRO, Virtex UltraScale+, and others.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
AMD Data Center Revenue Accelerates Growth
- Data Center Revenue Growth: AMD's data center revenue increased by 39% year-over-year in Q4 2025, a significant acceleration from 22% in Q3, indicating the company's recovery potential in this area, although the overall growth rate remains below the management's target of 60%.
- Market Share and Competition: AMD's stock rose approximately 60% in 2025, but experienced a pullback after the Q4 earnings announcement, with the current P/E ratio dropping from nearly 40 to 31, reflecting a market reassessment of its valuation, especially compared to rival Nvidia, which trades at a P/E of 24.
- Chinese Market Recovery: With the Trump administration allowing exports to China, AMD's sales are starting to rebound, a trend expected to significantly boost revenue throughout 2026 and beyond, further driving growth in its data center business.
- Long-Term Growth Outlook: AMD's five-year guidance released in November projected a 60% CAGR for the data center division and a 35% overall CAGR for the company, and while Q4 slightly missed these projections, it still shows strong progress toward these goals, with analysts expecting revenue growth of 34% and 37% for 2026 and 2027, respectively.
See More
AMD Positioned for Growth Amid AI Infrastructure Spending Surge
- Optimistic Market Outlook: McKinsey estimates that global spending on data centers will reach $7 trillion by 2030, driving rapid development in AI infrastructure, positioning AMD as an emerging force in the AI chip market to capitalize on this trend.
- Earnings Beat Expectations: AMD's Q4 2025 earnings report revealed an adjusted EPS of $4.17, a 26% year-over-year increase, and despite a 17% drop in stock price post-release, the market remains optimistic about its future growth.
- Revenue Growth Forecast: AMD anticipates a 32% year-over-year revenue increase in the current quarter, and projects its addressable market opportunity in data centers to grow from $200 billion last year to $1 trillion by 2030, indicating strong market demand.
- Attractive Valuation: With a PEG ratio of 0.65, AMD's stock is considered undervalued, and analysts expect EPS to exceed $20 by 2030; combined with the Nasdaq-100's forward P/E ratio, AMD's stock could potentially surpass $500, making it a multibagger opportunity.
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AMD's Data Center Sales Accelerate Growth
- Data Center Sales Growth: AMD's data center revenue accelerated to a 39% year-over-year growth in Q4 2025, up from 22% in Q3, indicating the company's potential in the AI sector, although still below the management's 60% CAGR target.
- Market Share Recovery: With the Trump administration allowing exports to China again, AMD's sales are starting to rebound, which is expected to provide strong growth momentum throughout 2026 and beyond, further solidifying its position in the global market.
- Stock Price Pullback Reasons: AMD's stock was trading at nearly 40 times forward earnings entering Q4, now down to about 31 times, which, despite being high compared to Nvidia's 24 times, reflects market concerns over its valuation.
- Future Growth Expectations: Wall Street analysts forecast AMD's revenue growth at 34% for 2026 and 37% for 2027, aligning with the management's overall 35% CAGR expectation, indicating a positive outlook on AMD's growth potential.
See More
TSMC: A Hidden AI Stock Giant
- Significant Revenue Growth: In 2025, TSMC's revenue increased by 36% in USD terms, with high-performance computing (HPC) revenue surging 48% and accounting for 58% of total revenue, highlighting its strong demand and market dominance in the AI chip sector.
- Improved Profitability: TSMC achieved a gross margin of 60% in 2025, expected to remain above 56% in the coming years, indicating robust pricing power and profitability amid soaring AI chip demand.
- Future Growth Expectations: TSMC anticipates nearly 30% revenue growth in 2026, with a projected CAGR approaching 25% from 2024 to 2029, reflecting its long-term growth potential in the AI market.
- Strategic Expansion Plans: TSMC plans to ramp up production of its 2nm chips in the second half of 2026 while expanding overseas plants in Japan, the U.S., and Europe to mitigate risks from potential Taiwan-China tensions, ensuring its competitive edge and supply chain security.
See More
Mixed U.S. Stock Market Performance with Tech Stocks Under Pressure
- Strong Chip Demand: Sandisk's stock surged over 8% following Kioxia's forecast of robust demand for NAND memory chips, indicating strong global demand for AI infrastructure, which boosts market confidence in tech stocks.
- Tech Stock Pressure: Cisco Systems' stock fell more than 9% as it warned that rising memory chip prices would erode profitability, limiting overall gains in tech stocks and reflecting cost pressures faced by the industry.
- Labor Market Data: U.S. initial jobless claims fell by 5,000 to 227,000, indicating a slightly weaker labor market than the expected 223,000, which may affect market expectations for future economic growth.
- Corporate Earnings Optimism: Over two-thirds of S&P 500 companies have reported earnings, with 78% exceeding expectations, and Q4 earnings growth is projected at 8.4%, providing support for the market and demonstrating corporate resilience.
See More
Nvidia Shares Climb as Attention Shifts to Earnings Report.
- Nvidia's Trading Activity: Nvidia is experiencing gains in early trading on Thursday, indicating positive market sentiment.
- Earnings Report Anticipation: Investors are optimistic as the company approaches its earnings report scheduled for later this month.
See More
AMD Data Center Revenue Accelerates Growth
- Data Center Revenue Growth: AMD's data center revenue increased by 39% year-over-year in Q4 2025, a significant acceleration from 22% in Q3, indicating the company's recovery potential in this area, although the overall growth rate remains below the management's target of 60%.
- Market Share and Competition: AMD's stock rose approximately 60% in 2025, but experienced a pullback after the Q4 earnings announcement, with the current P/E ratio dropping from nearly 40 to 31, reflecting a market reassessment of its valuation, especially compared to rival Nvidia, which trades at a P/E of 24.
- Chinese Market Recovery: With the Trump administration allowing exports to China, AMD's sales are starting to rebound, a trend expected to significantly boost revenue throughout 2026 and beyond, further driving growth in its data center business.
- Long-Term Growth Outlook: AMD's five-year guidance released in November projected a 60% CAGR for the data center division and a 35% overall CAGR for the company, and while Q4 slightly missed these projections, it still shows strong progress toward these goals, with analysts expecting revenue growth of 34% and 37% for 2026 and 2027, respectively.
See More
AMD Positioned for Growth Amid AI Infrastructure Spending Surge
- Optimistic Market Outlook: McKinsey estimates that global spending on data centers will reach $7 trillion by 2030, driving rapid development in AI infrastructure, positioning AMD as an emerging force in the AI chip market to capitalize on this trend.
- Earnings Beat Expectations: AMD's Q4 2025 earnings report revealed an adjusted EPS of $4.17, a 26% year-over-year increase, and despite a 17% drop in stock price post-release, the market remains optimistic about its future growth.
- Revenue Growth Forecast: AMD anticipates a 32% year-over-year revenue increase in the current quarter, and projects its addressable market opportunity in data centers to grow from $200 billion last year to $1 trillion by 2030, indicating strong market demand.
- Attractive Valuation: With a PEG ratio of 0.65, AMD's stock is considered undervalued, and analysts expect EPS to exceed $20 by 2030; combined with the Nasdaq-100's forward P/E ratio, AMD's stock could potentially surpass $500, making it a multibagger opportunity.
See More
AMD's Data Center Sales Accelerate Growth
- Data Center Sales Growth: AMD's data center revenue accelerated to a 39% year-over-year growth in Q4 2025, up from 22% in Q3, indicating the company's potential in the AI sector, although still below the management's 60% CAGR target.
- Market Share Recovery: With the Trump administration allowing exports to China again, AMD's sales are starting to rebound, which is expected to provide strong growth momentum throughout 2026 and beyond, further solidifying its position in the global market.
- Stock Price Pullback Reasons: AMD's stock was trading at nearly 40 times forward earnings entering Q4, now down to about 31 times, which, despite being high compared to Nvidia's 24 times, reflects market concerns over its valuation.
- Future Growth Expectations: Wall Street analysts forecast AMD's revenue growth at 34% for 2026 and 37% for 2027, aligning with the management's overall 35% CAGR expectation, indicating a positive outlook on AMD's growth potential.
See More
TSMC: A Hidden AI Stock Giant
- Significant Revenue Growth: In 2025, TSMC's revenue increased by 36% in USD terms, with high-performance computing (HPC) revenue surging 48% and accounting for 58% of total revenue, highlighting its strong demand and market dominance in the AI chip sector.
- Improved Profitability: TSMC achieved a gross margin of 60% in 2025, expected to remain above 56% in the coming years, indicating robust pricing power and profitability amid soaring AI chip demand.
- Future Growth Expectations: TSMC anticipates nearly 30% revenue growth in 2026, with a projected CAGR approaching 25% from 2024 to 2029, reflecting its long-term growth potential in the AI market.
- Strategic Expansion Plans: TSMC plans to ramp up production of its 2nm chips in the second half of 2026 while expanding overseas plants in Japan, the U.S., and Europe to mitigate risks from potential Taiwan-China tensions, ensuring its competitive edge and supply chain security.
See More
Mixed U.S. Stock Market Performance with Tech Stocks Under Pressure
- Strong Chip Demand: Sandisk's stock surged over 8% following Kioxia's forecast of robust demand for NAND memory chips, indicating strong global demand for AI infrastructure, which boosts market confidence in tech stocks.
- Tech Stock Pressure: Cisco Systems' stock fell more than 9% as it warned that rising memory chip prices would erode profitability, limiting overall gains in tech stocks and reflecting cost pressures faced by the industry.
- Labor Market Data: U.S. initial jobless claims fell by 5,000 to 227,000, indicating a slightly weaker labor market than the expected 223,000, which may affect market expectations for future economic growth.
- Corporate Earnings Optimism: Over two-thirds of S&P 500 companies have reported earnings, with 78% exceeding expectations, and Q4 earnings growth is projected at 8.4%, providing support for the market and demonstrating corporate resilience.
See More
Nvidia Shares Climb as Attention Shifts to Earnings Report.
- Nvidia's Trading Activity: Nvidia is experiencing gains in early trading on Thursday, indicating positive market sentiment.
- Earnings Report Anticipation: Investors are optimistic as the company approaches its earnings report scheduled for later this month.
See More
