AMD top pick for 2025 by Northland Capital Markets

Investing.com -- Advanced Micro Devices Inc (NASDAQ: AMD) has been named a top pick for 2025 by Northland Capital Markets given the company's strong growth potential in AI, server CPUs, and PC client segments.

The brokerage reiterated its $175 price target on AMD's competitive product roadmap and improving market dynamics.

Northland projects AMD's AI revenue to rise to $9.5 billion in 2025, up from $5.2 billion in 2024, driven by the ramp-up of its MI325X chip. While Nvidia (NASDAQ: NVDA) dominates in software, AMD's hardware is gaining traction in cloud-based AI deployments.

AMD's Turin processors are expected to outperform Intel's Granite Rapids across most workloads. Data center revenue, excluding AI, is forecast to grow 10% year-over-year to $8.5 billion in 2025, with potential upside.

Demand for AMD's PC chips is expected to rise as Microsoft (NASDAQ: MSFT) ends support for Windows 10, prompting an upgrade cycle for nearly 1.2 billion systems. AMD's PC client revenue is forecast at $7.9 billion, with potential to exceed $9 billion if the replacement cycle unfolds as anticipated.

Embedded segment revenue is projected to grow $350 million in 2025 after bottoming in early 2024, while gaming revenue is forecast to remain flat in 2025, following significant declines in 2024.