HSBC Doubles Down on AMD: AI Chip Surge Could Challenge Nvidia's Dominance

HSBC has recently shown confidence in AMD by upgrading the chip manufacturer's rating from "hold" to "buy," doubling the price target from $100 to $200. This optimistic move is driven by HSBC's positive outlook on AMD's thriving AI GPU product line.

Frank Lee, an HSBC analyst, highlighted that AMD's latest MI350 series chips hold a significant pricing advantage over Nvidia's Blackwell B200 chips. Lee's analysis indicates that the average selling price of the MI355 chips could reach $25,000 per unit, a notable increase from the previous estimate of $15,000.

This upward leap in pricing might considerably boost AMD's AI business revenue for the 2026 fiscal year, potentially prompting a market reassessment. Although AMD's stock price has already risen by 14% following its AI event, Lee believes the market has yet to fully recognize this potential.

HSBC views the pricing advantage and the plug-and-play compatibility of the MI350 with existing data centers as critical factors that could enable AMD to reclaim market share in the AI GPU space, which is currently dominated by Nvidia.

Dr. Lisa Su, AMD's CEO, emphasized the company's commitment to an open ecosystem during last month's AI event, pledging support for all major frameworks and offering full-stack solutions that simplify and reduce the cost of deploying AI hardware.

HSBC's focus is now drawn to the upcoming MI400 series. Lee predicts this series may further enhance AI revenue. Overall, the firm believes AMD's strong push into the AI chip sector is just beginning, and Wall Street is poised to recognize it soon.