AMD CEO Lisa Su expressed strong optimism for 2026, driven by momentum in high-performance computing and deepening customer relationships, particularly with Meta and OpenAI. The company recently signed a 6-gigawatt strategic partnership with Meta to co-design a semi-custom GPU, leveraging warrants to align long-term incentives. Su highlighted the upcoming launch of the MI450 series and the Helios rack-scale system, emphasizing AMD’s investments in software and open ecosystems to accelerate deployment. While acknowledging supply tightness due to unexpectedly high demand, Su reaffirmed confidence in meeting targets, citing robust CoWoS capacity for a sharp second-half ramp.
Key Takeaways
- Meta Partnership: AMD signed a long-term, 6-gigawatt strategic partnership with Meta to develop a semi-custom GPU, utilizing warrants to align incentives and deepen ecosystem integration.
- MI450 Launch: The MI450 series represents a significant step function in capability, with a general-purpose design and a specialized MI430 variant for HPC workloads, leveraging chiplet architecture for flexibility.
- Rack-Scale Focus: The acquisition of ZT Systems and the development of the Helios rack (based on open standards co-developed with Meta) aim to reduce "time to workload" for customers.
- Revenue Ramp: The MI450 and rack-scale systems are expected to begin revenue generation in Q3, with a sharp volume ramp in Q4, supported by sufficient CoWoS capacity.
- Market Sizing: Su reaffirmed the $400 billion AI accelerator market opportunity by 2027 (often cited as a path to a $1 trillion market by the end of the decade), driven by enterprise adoption and agentic AI workloads.
- CPU Demand: Traditional compute demand is exceeding expectations due to the need to support AI agents, with the upcoming "Venice" CPU on TSMC 2nm seeing strong customer interest.
- China Outlook: Revenue from China remains unpredictable due to licensing restrictions; while some MI300 sales occurred in Q4, no significant future revenue is currently forecasted.
- Memory Dynamics: HBM supply is secured through long-term planning, though volatility in broader memory prices may create cost pressures in the PC market in the second half of the year.
Q&A
Joe Moore (Morgan Stanley): Can you give an overview of the deal signed with Meta and the associated warrants?
- Lisa Su: The 6-gigawatt partnership involves co-designing a semi-custom GPU for Meta's specific workloads; the performance-based warrants align incentives, ensuring Meta gets optimized infrastructure while AMD accelerates its software and technology ecosystem.
Joe Moore (Morgan Stanley): Do you anticipate other customers for MI455 will have similar warrant structures?
- Lisa Su: No, warrants are reserved for "transformational partnerships" like Meta and OpenAI that help chart the path of AI infrastructure; while interest in MI450 is broad, these relationships are unique multi-generational collaborations.
Joe Moore (Morgan Stanley): What is your confidence in having silicon out in time and meeting timelines for rack-scale systems given competitor challenges?
- Lisa Su: AMD has done extensive risk mitigation, validating the rack-scale system before final silicon and designing the Helios rack to avoid previous industry issues; early workloads are running well in labs.