TMTPOST -- Advanced Micro Devices Inc. expects its data center revenue to surge 60% over the next three to five years from an estimated $16 billion in 2025, as the U.S. chipmaker doubles down on artificial intelligence and intensifies competition with Nvidia Corp.
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The projection came during AMD’s Financial Analyst Day in New York on Tuesday, where Chief Executive Officer Lisa Su said the company sees the total addressable market for AI data centers expanding to $1 trillion within five years. That estimate includes hardware such as GPUs, CPUs, and networking equipment.
“We are still in the very early innings of the AI build-out,” Su said. “This is a very unique moment in AI, and we shouldn’t be shortsighted in thinking only about near-term returns.”
Chief Financial Officer Jean Hu said AMD’s overall revenue will climb 35% over the same period, reaching roughly $46 billion, with most of the growth driven by the company’s data center segment. She expects gross margins to remain between 55% and 58% and operating margins to exceed 35% in the next three to five years.
AMD’s upbeat outlook comes as the company rides a wave of major data center partnerships. The chipmaker recently announced a 6-gigawatt project with OpenAI and plans to supply Oracle Corp. with 50,000 chips, both set to start in 2026.
While no new partnerships were disclosed at the event, Su said AMD sees opportunities for multiple gigawatt-scale projects across hyperscalers, AI-native firms, and sovereign AI initiatives, powered by its MI450 series accelerators and Helios rack-scale systems.
Some analysts have questioned whether the industry can meet the enormous power demands of AI infrastructure and whether clients such as OpenAI can finance large-scale GPU purchases. Su responded that she remains confident in the sector’s momentum and funding potential. “If AI usage grows as much as we expect, I think there’s going to be plenty of financing,” she said.
AMD also revealed that development of its next-generation MI500 series chips is underway, though Su provided few details about their specifications or release timeline. The company expects these new processors to bolster its presence in AI data centers as demand for compute power continues to surge.
Beyond GPUs, AMD is banking on its server CPU lineup to sustain growth. The company aims to capture as much as 50% of the global server market share in revenue terms, up from about 40% today, driven by its EPYC processors.
AMD’s client segment, which includes gaming and PC processors, is also forecast to expand by more than 10% over the next five years. The company is seeking to gain further share from Intel Corp., which continues to struggle through a multiyear turnaround.
The market has rewarded AMD’s progress. The company’s shares have jumped 96% so far this year and 61% over the past 12 months, outperforming Nvidia’s 43% and 32% gains over the same periods.
Analysts say AMD’s strategy highlights its growing ambitions to become a central player in AI infrastructure, even as Nvidia remains the industry leader. With a trillion-dollar market in sight and new products on the horizon, Su is betting that AMD’s deepening focus on AI hardware will secure it a stronger foothold in the next phase of the data center race.
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