Goldman Sachs raises AMD price target to $640 from $450

On July 6, Goldman Sachs raised its price target on Advanced Micro Devices (AMD) to $640 from $450, maintaining a Buy rating on the stock. This $190 price-target increase reflects growing confidence in AMD's AI business trajectory.

The upgrade comes on the heels of AMD and Rackspace Technology signing a definitive agreement on June 16 to deploy an initial 30 megawatts of AMD-based AI compute infrastructure across Rackspace's global data centers. The legally binding contract formalizes a preliminary memorandum of understanding the two companies announced in May. According to the agreement, this infrastructure will launch in phases from late 2026 through 2028. The deployment will support regulated enterprise workloads using AMD Instinct GPUs and AMD EPYC CPUs within Rackspace's Enterprise AI Cloud architecture.

Gajen Kandiah, CEO of Rackspace Technology, said the collaboration combines compute infrastructure with a governed operating model under a single accountable partner. Dan McNamara, Senior Vice President and General Manager of Compute and Enterprise AI at AMD, noted that the partnership will help regulated enterprises place scalable AI infrastructure. Both companies committed joint sales and marketing resources to pursue enterprise customers across regulated industries, signaling a strategic alignment to drive adoption beyond the initial deployment.

AMD's enterprise AI infrastructure partnership with Rackspace reflects growing demand for purpose-built AI compute in regulated industries. The definitive agreement signed on June 16 crystallizes what began as a preliminary memorandum of understanding in May, converting the collaboration into a legally binding contract. The phased rollout timeline—late 2026 through 2028—suggests a measured, enterprise-grade deployment focused on reliability and governance rather than speed to market.

Goldman Sachs' July 6 price target increase to $640 from $450 appears grounded in confidence that AMD's Instinct GPUs and EPYC CPUs will capture meaningful share in regulated enterprise AI workloads. The joint commitment by both AMD and Rackspace to aligned sales and marketing activities suggests the partnership is structured to drive revenue at scale, not merely as a pilot. This credibility likely factored into the analyst's 42% upside revision and maintained Buy rating.

No comments yet. Be the first to share your thoughts!