Positioning for the 2026 AI-Driven Bull Market: Why AMD and Alphabet Are Must-Owns

The artificial intelligence (AI) revolution is accelerating at an unprecedented pace, reshaping industries and redefining global economic dynamics. As we approach 2026, two companies-Advanced Micro Devices (AMD) and Alphabet (GOOGL)-stand out as pivotal players in the AI infrastructure race. Their strategic investments, earnings trajectories, and market positioning make them compelling long-term holdings for investors seeking to capitalize on the AI-driven bull market.

AMD: A Catalyst for AI Infrastructure Growth

AMD's aggressive expansion into AI chips and data centers has positioned it as a direct challenger to Nvidia's dominance. The company's data center segment is projected to grow at a staggering 60% CAGR through 2025, driven by insatiable demand for AI accelerators like the MI400X and MI450 GPUs. This momentum is underscored by a landmark partnership with OpenAI, which will deploy 6 gigawatts of AMD's MI450 GPUs starting in late 2026. The deal includes a warrant for OpenAI to acquire up to 10% of AMD, aligning incentives and signaling confidence in the company's long-term potential.

Financially, AMD's growth is equally impressive. Non-GAAP earnings are expected to surpass $20 per share by 2025, far outpacing the $2.68 per share estimate from LSEG. This leap is fueled by strong demand for its EPYC processors and Instinct AI chips, which drove a 22% year-over-year revenue increase in Q3 2025. AMD's ability to secure high-margin contracts with hyperscalers and enterprises, coupled with its next-generation Helios rack systems, positions it to capture double-digit market share in the data center AI chip market within three to five years according to market analysts.

Alphabet: Scaling AI Infrastructure for Sustained Dominance

Alphabet's strategic investments in AI infrastructure are equally transformative. The company's Q3 2025 results highlighted a record $102.3 billion revenue milestone, with Google Cloud contributing $15.2 billion-a 34% year-over-year increase. This growth is driven by enterprise demand for AI solutions, including the Gemini model, which now serves 650 million monthly active users. Alphabet's capital expenditures for 2025 are projected to reach $91–93 billion, with 60% allocated to servers and AI-specific hardware like TPUs and GPUs. This spending reflects a commitment to maintaining leadership in cloud computing and AI-driven services.

The Google Cloud backlog now stands at $155 billion, indicating robust long-term demand for AI infrastructure according to earnings reports. Alphabet's recent negotiations to supply TPUs to Meta underscore its expanding role in the AI ecosystem. By diversifying its AI hardware offerings and strengthening enterprise partnerships, Alphabet is well-positioned to benefit from the structural growth of the AI market, even as it faces competition from rivals like Microsoft and AWS.

### Strategic Synergies and Earnings Momentum
Both AMD and Alphabet are leveraging their strengths to navigate the AI infrastructure boom. AMD's focus on cutting-edge chip design and strategic partnerships (e.g., OpenAI, Oracle) ensures a steady pipeline of high-margin revenue. Alphabet, meanwhile, is scaling its AI infrastructure to meet surging demand while monetizing its cloud and AI services through enterprise contracts.

From an earnings perspective, AMD's projected $20-per-share non-GAAP earnings by 2025 represent a 600% increase from its 2023 levels, while Alphabet's cloud segment is on track to contribute a growing share of its revenue. These metrics, combined with their respective capital expenditures and market share ambitions, highlight their resilience in a competitive landscape dominated by Nvidia and Microsoft.

Conclusion: Must-Owns for the AI Era

As the AI-driven bull market gains momentum, AMD and Alphabet are uniquely positioned to deliver outsized returns. AMD's breakthrough in AI chips and its landmark OpenAI deal provide a clear path to market share gains, while Alphabet's infrastructure investments and cloud expansion ensure sustained growth. For investors seeking exposure to the AI revolution, these two stocks represent a strategic and financially sound foundation.