Key Points

Analysts at Citigroup expect AMD to unveil a major new chip customer later this month.
AMD holds a solid stance in the CPU market that should grow sharply as agentic AI workflows enter production.
AMD stock has already doubled this year and shares appear increasingly expensive.
10 stocks we like better than Advanced Micro Devices

Over recent years Advanced Micro Devices has positioned itself as a flexible rival in the artificial intelligence semiconductor arena by delivering a wide array of central processing units and specialized accelerators.

On July 22 and 23 the company will host an event titled Advancing AI. As the date nears analysts from Citigroup released a note indicating the gathering may include notable announcements.

This situation prompts a clear question for investors: Is it wise to purchase AMD stock before the event? We examine the factors driving Wall Street optimism and review the companys valuation.

The AI CPU market could exceed prior estimates

One reason for excitement centers on the rising role of CPUs in evolving AI tasks. Both Citi analysts and investment commentator Jim Cramer have noted the expanding importance of CPUs in agentic AI processes where they work alongside graphics processing units.

Citi estimates the total addressable market for CPUs may rise from about 29 billion dollars soon to more than 131 billion dollars by 2030. The firm also predicts that demand for agentic CPUs will represent roughly half of that market.

AMDs EPYC processors stand to gain if these forecasts hold. Highlighting CPUs at the summit could strengthen views of AMDs broad lineup as the firm expands past data center GPUs into a fuller AI infrastructure offering.

AMD may name a fresh customer

Citi analysts suggest AMD could announce wider use of its MI series chips possibly with frontier AI labs.

A firm such as Anthropic which already uses Nvidia GPUs Alphabet TPUs and Amazon custom chips might add AMD designs to spread risk and control expenses.

Is AMD stock a buy now?

Any news of new customers would validate AMDs chips yet such an outcome remains uncertain and should not be viewed as a sure trigger. The outlook is speculative and even one win would not overhaul the investment thesis alone.

Halfway through 2025 AMD shares have risen 159 percent. This gain has produced a forward price to earnings multiple of 75. The market clearly anticipates strong future results.

Although AMD possesses attractive prospects in AI a strategy of dollar cost averaging over years tends to outperform attempts to time entries around single events. This method lets investors capture growth in the CPU space and potential market share gains without over committing around one catalyst.

Should you buy shares of Advanced Micro Devices today?

Before purchasing shares of Advanced Micro Devices keep this in mind.

The Motley Fool Stock Advisor team has named what it views as the 10 top stocks for investors to own now and Advanced Micro Devices did not appear on that list. The 10 selected stocks may deliver strong gains in coming years.

Stock Advisor has delivered an average return of 918 percent far outpacing the 208 percent gain of the S and P 500. Review the latest top 10 list through Stock Advisor and join a community built by individual investors for individual investors.

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