Investing.com -- Analysts at Baird have slashed their 2024 estimates for Advanced Micro Devices (NASDAQ:AMD), citing a lowered revenue outlook for the U.S. chipmaker's data center business.
In a note also decreasing their price target to $125 from $170, the analysts said that they were pushing out their prediction for AMD to take "meaningful" market share in generative artificial intelligence.
Meanwhile, the Baird analysts cast some doubts over the planned fourth-quarter ramp up of AMD's upcoming MI300 AI chip, flagging a "lack of design wins outside of supercomputing applications so far and [...] the absence of a well-established software ecosystem."
In August, AMD said the customer interest in the MI300 was "very high."
Shares in the company were trading lower on Thursday.
Although AMD has been viewed as a potential rival to Nvidia (NASDAQ:NVDA) in the race to produce the powerful AI semiconductors behind popular applications like ChatGPT, analysts have raised some concerns that its AI strategy may be too ambitious.
Hype around AI has fueled the chip sector this year, but Nvidia has so far been the major winner, becoming the first and only chipmaker to achieve a valuation of over a trillion dollars.