To The Moon

On February 24, the AI world got a real shock: Meta announced a multi-year deal with AMD, planning to roll out up to 6 gigawatts of AMD AI compute across its data centers over the next few years. The market loved it — AMD jumped more than 10% intraday and added almost $20 billion in market cap in one day. $Advanced Micro Devices(AMD)$

Some Tigers were already in position:

• 👏 @AMDidass — AMD stock +2,748

• 👏 @T2021B — AMD calls +5,679

A few weeks earlier, AMD had already printed a strong quarter:

revenue up about 34% to ~$10.3B, beating expectations by roughly $600M. Data center sales were the star, up ~39%, with EPYC CPUs and Instinct GPUs driving higher margins. Gross margin moved to the mid-50s, operating margin jumped from low double digits to the high teens. Client and Gaming were growing too, not dragging things down.

But the stock still sold off — at one point more than 17% off the highs. The problem wasn’t the past quarter, it was the guidance. Management guided Q1 revenue down a bit quarter-over-quarter, and China MI308 sales stepping down sharply. In an AI hype environment, that felt “not aggressive enough,” so the market got nervous about AMD’s AI momentum.

That’s why the Meta deal matters so much.

Instead of just saying “we have good AI products and a roadmap,” AMD now has a multi-year, large, named customer with a clear deployment plan. Meta isn’t just buying a few GPUs. It’s committing to:

• A semi-custom version of AMD’s next-gen Instinct MI450, tuned for Meta’s own AI workloads

• Next-gen EPYC CPUs like “Venice” and “Verano”

• A joint rack-level system called Helios, designed together around Meta’s data centers

So AMD moves from “one of the vendors on the list” to a co-designer of Meta’s AI infrastructure.

On top of that, the two companies tied the deal to equity. AMD granted Meta performance-based warrants for up to 160 million AMD shares — close to 10% potential ownership. These only vest if two things actually happen: Meta ramps deployments from 1 GW to 6 GW of AMD compute, and AMD stock hits certain price levels.

In simple terms: Meta gets upside in AMD if the partnership really works and scales. AMD accepts future dilution in exchange for a huge, long-term, high-visibility customer. That’s what investors care about right now: visibility. Not just “AI is big,” but “who is actually getting the orders, and over how many years?”

After earnings, the market wasn’t sure about AMD’s path. After the Meta deal, the story looks a lot clearer: 6 GW of planned capacity, multi-year contracts, plus earlier deals with players like OpenAI. That’s the kind of “certainty” that can justify higher valuations in an AI capex cycle.

So What’s Next?

Is AMD already priced for this new AI role,

Drop your take below:

💬 Bullish or bearish on AMD from here?

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