In 2025, it is feared that GPU revenue may not reach 10 billion US dollars. Wolfe Research downgrades AMD (AMD.US) rating to "in line with the market".

Investment firm Wolfe Research has downgraded the rating of AMD (AMD.US) from "outperforming the market" to "performing in line with the market" due to lower than expected growth in GPU revenue. Wolfe analyst Chris Caso wrote in a note to clients, "Original design manufacturer production plans suggest small sequential growth in this quarter based on run rates for the fourth quarter of 2024. Based on these checks, we estimate fourth quarter data center GPU revenue to be between $1.5 billion to $2 billion in 2025, far below the buy side expectation of about $10 billion and our previous estimate of $10.8 billion. We forecast first quarter 2025 DC GPU revenue to be $1.75 billion, with sequential growth for the year remaining flat." In addition to potentially weaker data center GPU revenue, Caso noted that he expects seasonal growth in personal computers to slow down, the gaming market to remain soft, and the embedded market to not show signs of recovery at least in the first half of this year. Despite these negative factors, Caso believes that the upcoming MI350 AI accelerator from AMD is expected to be a "significant catalyst," set to launch later this year. He anticipates that this accelerator will have significant redesign and upgrades compared to the recently launched MI325, which only had a memory load increase over AMD's original MI300.