Here's What a $1,000 Investment in AMD Could Be Worth by 2030
Advanced Micro Devices(NASDAQ: AMD) has been one of the top-performing stocks in 2026, clocking impressive gains of over 120% as of this writing, and the good news is that it can deliver further gains to investors thanks to an acceleration in growth.
AMD released its third-quarter results on Nov. 3, and the stock soared the following day. Let's see why that was the case and check how much upside this fast-growing semiconductor stock could deliver by the end of the decade.
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AMD's data center business has supercharged its growth
AMD's Q3 revenue increased 45% year over year to $13.4 billion. The company's non-GAAP earnings per share of $2.09 increased by 74% from the year-ago period. AMD's data center business was the primary driver of its impressive growth, with the segment's revenue nearly doubling year over year to a record $8.5 billion.
It is worth noting that AMD's revenue and earnings easily exceeded Wall Street's expectations. The company noted healthy demand for its Epyc server processors and Instinct data center graphics cards. The good news for AMD investors is that the company expects data center revenue to accelerate in the current quarter. What's more, its full-year data center revenue is on track to double from 2025 levels.
Looking ahead, AMD expects the data center segment to account for 80% of its top line in 2027. That implies a major improvement over the previous quarter, when the data center segment produced 64% of AMD's top line. Moreover, the increasing reliance on the data center business is a good sign for AMD, given the ongoing weakness in the personal computer market.
AMD reported an 8% year-over-year decline in its client and gaming segment revenue last quarter to $3.7 billion. Notably, its PC-focused client processor revenue increased 7% from the year-ago period despite a 21% decline in PC industry shipments last quarter. The gaming segment continues to struggle due to the aging gaming console generation. However, the potential arrival of a new generation of gaming consoles next year could lift this segment and complement the healthy growth AMD has been witnessing in data centers.
Importantly, AMD expects significant acceleration in growth despite challenging conditions in the gaming and PC markets. The company expects revenue to increase by 66% year over year in the current quarter, a substantial step up from the 45% growth seen in the previous one.
Here's why you can invest $1,000 in this stock
If you have $1,000 in investable cash right now after paying your bills, clearing expensive loans, and saving enough for tough times, buying AMD stock could be a smart move before it soars higher. That's because the company has tremendous earnings growth potential, as evident from the following chart.
Assuming its bottom line increases by even 20% in 2029 and 2030, its earnings per share could reach $33.41 by the end of the decade (using 2028's estimated earnings per share of $23.20 as the base). If AMD trades at 30 times earnings at that time, in line with the tech-laden Nasdaq-100 index's earnings multiple, its stock price could reach $1,002. That's 93% higher than AMD's current stock price.
So, AMD can turn a $1,000 investment into more than $1,900 in just over four years, making it an ideal investment for anyone looking to add a growth stock to their portfolio.
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Harsh Chauhan has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Advanced Micro Devices. The Motley Fool has a disclosure policy .
Here's What a $1,000 Investment in AMD Could Be Worth by 2030 was originally published by The Motley Fool
