11:10 AM EST, 11/12/2025 (MT Newswires) -- AMD's (AMD) AI-focused guidance and new long-term financial model at its recent analyst day suggests a "clear upside" to expectations, Wedbush said in a Tuesday note.

The company's outlook for its AI accelerator business to grow by 60% is the largest driver of higher revenue expectations compared to the Wedbush model and consensus, according to the note. AMD's new model also projects a compounded annual growth rate of 35% over the next three to five years, Wedbush analysts said.

The key focus is on whether AMD can successfully execute and deliver on the performance and timelines expected for its Helios rack system and MI400 series GPUs, the analysts said. Although the company is confident in achieving its targets, the analysts said they are reluctant to raise their estimates without further insight on its execution.

AI is driving significant growth in the overall computing market with AMD forecasting that the total addressable market for compute grows at 18% annually, according to the note. Such a strong growth trend means increasing demand not just for AMD's products but across the entire server supply chain, especially for commodity components like memory and hard disk drives, which are already in short supply due to high computing demand, the note said.

Wedbush reiterated the company's stock at outperform and price target at $290.

Price: 259.09, Change: +21.57, Percent Change: +9.08