AMD: Management's Guidance Implies GPUs Are The Main Story For Now

Advanced Micro Devices, Inc. (AMD) has been creating a narrative around itself of both an eater of the data center GPU TAM pie and a leader in the CPU inference market.

Confidence is highest in AMD's CPU business, given visible pricing power and a 46% x86 server revenue share, while GPU growth is more dependent on price-driven market share gains. Key risks include TSMC CoWoS capacity constraints, ARM's rising CPU market share, and potential multiple compression regardless of earnings delivery. AMD's margin profile is supported by recent results: Q1 2026 gross margin at 55%, data center operating margin at 28%, and further margin expansion guided for Q2.