What happened
AMD's Q2 FY2026 revenue hit $11.54 billion, up 50.1% year over year, with Data Center revenue at $6.72 billion and +107% growth. Lisa Su expects Data Center revenue to more than double again in 2027.
Why it matters
Broadcom's Q3 FY2026 AI semiconductor revenue was $16.70 billion, growing 221% year over year, and it guided Q4 AI revenue to $21.7 billion. Broadcom co-designs custom AI chips (XPUs) with hyperscalers, while AMD sells merchant GPUs. The overlap: OpenAI, Anthropic, and Meta are customers of both, potentially shrinking AMD's market at those accounts.
What to watch
The test is whether AMD's Helios shipments and its $1.4 trillion 2030 AI accelerator TAM assumption hold, especially as Broadcom supplies Google with multi-tens of billions of TPUs annually. Watch AMD's stock performance, up 195.18% over one year, and Broadcom's cooling trend, down 14.44% in the past month.
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The article contrasts AMD's merchant GPU approach with Broadcom's custom silicon strategy. AMD's explosive growth is real, but Broadcom's revenue scale and margin suggest a structural advantage. The author's lean toward Broadcom stems from its free cash flow and customer pre-commitments, while AMD's story remains exciting but less defensive. The outcome hinges on whether frontier AI workloads shift to custom chips, potentially capping AMD's opportunity despite its current momentum.
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