AMD · Forward model · Bear case

The Bear case, 20 quarters out

Each segment is projected from its own operating driver, rolled up into consolidated cash flow, and discounted back to a fair value per share. The assumptions below are editable — change them and every number on this page moves with them.

AMD reports THREE operating segments — Data Center, Client and Gaming, Embedded — and discloses Client and Gaming dollars separately inside the second of those. This model carries FOUR verticals so Gaming's console trough is not hidden inside Ryzen. Every historical point is copied from the 8-Ks or derived from two disclosures (Q4 2025 Client = combined $3,940M less Gaming $843M; Q3 2025 Data Center = consolidated $9,246M less the three IR-rounded lines, an $11M remainder). Instinct versus EPYC inside Data Center is NOT split: AMD does not publish it. Helios racks have no ASP or unit count, so Data Center is a growth driver rather than a unit driver — inventing a rack price would look more rigorous and be less true. Fiscal quarters are 13 weeks; 2026 Q2 ended 27 June 2026 and is labelled 2026 Q2. Segment 'EBITDA' here is the disclosed segment operating margin. Client and Gaming OP is published only as a pair ($582M, 15.2%); the 16% and 12% on those two lines are assumed mix. Corporate 9.4% is the All other bucket (acquisition-related amortisation, stock-based compensation, deal costs), not a fourth business. netCash is cash $5,086M plus short-term investments $8,025M less total debt $3,226M. Capex $808M is 7% of the basis quarter and may be a Helios stand-up spike; terminal 4% assumes that. Q2 2025 Data Center OP of −$155M included $800M of MI308 China-export charges and is not a clean year-ago.

Instinct attach stalls, Helios slips, and Data Center growth fades toward EPYC-only. Gaming stays in the trough. Capex does not fall back, so cash stays compressed. What this case does NOT assume is a return to the $800M China-charge quarter or a loss of the Ryzen franchise. It says 2026 was the peak growth year for GPU content.

AMD REVENUE MODEL

Latest: $11.06B (2031Q2E)

Period	Value
2025Q1	$7.44B
2025Q2	$7.68B
2025Q3	$9.25B
2025Q4	$10.27B
2026Q1	$10.25B
2026Q2	$11.54B
2026Q3E	$12.33B
2026Q4E	$12.98B
2027Q1E	$13.48B
2027Q2E	$13.85B
2027Q3E	$14.10B
2027Q4E	$14.23B
2028Q1E	$14.26B
2028Q2E	$14.21B
2028Q3E	$14.10B
2028Q4E	$13.93B
2029Q1E	$13.72B
2029Q2E	$13.48B
2029Q3E	$13.21B
2029Q4E	$12.92B
2030Q1E	$12.62B
2030Q2E	$12.32B
2030Q3E	$12.00B
2030Q4E	$11.69B
2031Q1E	$11.38B
2031Q2E	$11.06B

What drives each segment

Data Center

Growth path

Basis quarter$6.72B

Final quarter$7.55B

Implied CAGR+2%

Share of revenue, final quarter68%

PV of segment cash flow$29.14B

EPYC server CPUs and Instinct GPUs, now sold increasingly as Helios racks. 58% of the basis quarter, up 107% year over year. What paces it is packaging, HBM and customer-site power, none of which AMD publishes as a unit or megawatt series, so the projection is sequential growth on the reported segment. Lisa Su's 2027 double is the named case, not the opening rate.

Last four quarters

2025 Q3 $4.29B Estimated

2025 Q4 $5.38B Reported

2026 Q1 $5.78B Reported

2026 Q2 $6.72B Reported

EPYC server CPUsInstinct GPUs — MI350 now, MI400/MI450 nextHelios rack-scale systemsPensando DPUs, AI NICs, data-center FPGAs

Sequential growth +18.0%/qtr decaying toward +3.0% 18% QoQ. Q1-to-Q2 was +16%; Hu said DC accelerates in H2. 18% plus the other lines hits the $13.0B Q3 midpoint.

Data Center

Latest: $7.55B (2031Q2E)

Period	Value
2025Q1	$3.67B
2025Q2	$3.24B
2025Q3	$4.29B
2025Q4	$5.38B
2026Q1	$5.78B
2026Q2	$6.72B
2026Q3E	$7.45B
2026Q4E	$8.08B
2027Q1E	$8.59B
2027Q2E	$8.98B
2027Q3E	$9.27B
2027Q4E	$9.46B
2028Q1E	$9.56B
2028Q2E	$9.59B
2028Q3E	$9.56B
2028Q4E	$9.49B
2029Q1E	$9.37B
2029Q2E	$9.22B
2029Q3E	$9.05B
2029Q4E	$8.86B
2030Q1E	$8.65B
2030Q2E	$8.44B
2030Q3E	$8.22B
2030Q4E	$8.00B
2031Q1E	$7.78B
2031Q2E	$7.55B

Assumptions & reasoning

A growth driver rather than units, and that is the honest answer. AMD publishes no GPU shipments, no Helios rack count and no ASP. Backing out a rack at an assumed $2-3M would look like the Nvidia model and would be fiction: even the customer GW headlines (Anthropic 2 GW, Meta 6 GW) are not a disclosed MW series.
Opening 18% is the Q3 guide, not the trailing 16%. Combined with Client +6%, Gaming flat and Embedded +8% it prints $13.0B, the midpoint of $12.7-13.3B. Jean Hu said Data Center sales accelerate in the second half; this is that, not Su's 2027 double.
Segment operating margin 31.3% ($2,103M on $6,718M). Q2 2025 was −$155M because of $800M of MI308 China-export charges, so the year-ago margin is not a base. Terminal 34% is a few points of Instinct mix, not a walk to Nvidia 70%.
Q3 2025 $4,289M is the $11M remainder after subtracting the IR-rounded Client, Gaming and Embedded lines from consolidated $9,246M. IR printed Data Center as $4.3 billion.

Client

Growth path

Basis quarter$3.06B

Final quarter$2.26B

Implied CAGR-6%

Share of revenue, final quarter20%

PV of segment cash flow$3.27B

Ryzen CPUs for notebooks and desktops. $3.06B in the basis quarter, +23% year over year and +6% sequential. A PC-cycle line with share gains, disclosed every quarter inside Client and Gaming. Operating income is not split from Gaming, so the 16% margin is an assumption about mix.

Last four quarters

2025 Q3 $2.80B Reported

2025 Q4 $3.10B Estimated

2026 Q1 $2.88B Reported

2026 Q2 $3.06B Reported

Ryzen desktop and mobile processorsRyzen AI / Copilot+ PCsChipsets

Sequential growth +6.0%/qtr decaying toward +1.5% 6% QoQ, matching Q1-to-Q2. Holds that pace into a seasonally stronger PC half rather than extrapolating 23% YoY.

Client

Latest: $2.26B (2031Q2E)

Period	Value
2025Q1	$2.29B
2025Q2	$2.50B
2025Q3	$2.80B
2025Q4	$3.10B
2026Q1	$2.88B
2026Q2	$3.06B
2026Q3E	$3.12B
2026Q4E	$3.14B
2027Q1E	$3.15B
2027Q2E	$3.14B
2027Q3E	$3.11B
2027Q4E	$3.08B
2028Q1E	$3.03B
2028Q2E	$2.98B
2028Q3E	$2.93B
2028Q4E	$2.87B
2029Q1E	$2.81B
2029Q2E	$2.75B
2029Q3E	$2.69B
2029Q4E	$2.63B
2030Q1E	$2.56B
2030Q2E	$2.50B
2030Q3E	$2.44B
2030Q4E	$2.38B
2031Q1E	$2.32B
2031Q2E	$2.26B

Assumptions & reasoning

Client and Gaming operating income is $582M, 15.2% of the combined $3,841M. Client is 80% of that revenue. 16% is the blend plus a point, an assumption, not a disclosure.
Q4 2025 $3,097M is combined Client-and-Gaming $3,940M from the Q1 2026 slides less disclosed Gaming $843M. IR printed Client as a record $3.1 billion.
Opening 6% is the trailing sequential rate, not the 23% year-over-year print. A reader who thinks AI PCs are a new cycle should take the slider up; a reader who thinks Q2 was a catch-up should take it down.

Gaming

Growth path

Basis quarter$779M

Final quarter$368M

Implied CAGR-14%

Share of revenue, final quarter3%

PV of segment cash flow$377M

Semi-custom console SoCs plus Radeon discrete GPUs. $779M in the basis quarter, down 31% year over year on lower semi-custom. This is a console-cycle trough, not a franchise collapse. Opening growth is zero: the Q1-to-Q2 bounce is not a new cycle.

Last four quarters

2025 Q3 $1.30B Reported

2025 Q4 $843M Reported

2026 Q1 $720M Reported

2026 Q2 $779M Reported

Semi-custom SoCs for game consolesRadeon discrete GPUsSemi-custom development services

Sequential growth +0.0%/qtr decaying toward +0.5% Zero. Year-over-year still −31% on semi-custom. The Q1-to-Q2 bounce is not a new console cycle.

Gaming

Latest: $368M (2031Q2E)

Period	Value
2025Q1	$647M
2025Q2	$1.12B
2025Q3	$1.30B
2025Q4	$843M
2026Q1	$720M
2026Q2	$779M
2026Q3E	$748M
2026Q4E	$718M
2027Q1E	$691M
2027Q2E	$664M
2027Q3E	$639M
2027Q4E	$615M
2028Q1E	$593M
2028Q2E	$571M
2028Q3E	$550M
2028Q4E	$530M
2029Q1E	$511M
2029Q2E	$493M
2029Q3E	$475M
2029Q4E	$458M
2030Q1E	$442M
2030Q2E	$426M
2030Q3E	$411M
2030Q4E	$396M
2031Q1E	$382M
2031Q2E	$368M

Assumptions & reasoning

The 2025 H2 prints ($1.3B, $843M) were semi-custom. Q2 2026 at $779M is that cycle rolling off, which is why opening growth is zero rather than the +8% sequential bounce.
Margin 12% is below the 15.2% Client-and-Gaming blend because semi-custom is the weaker half. AMD does not publish Gaming operating income. If you think discrete GPUs are the future of this line, the margin slider is where that lives.
A next-generation console win would show up as a delayed jump, not as 0.5% terminal growth. That is a bull-case claim this line does not make.

Embedded

Growth path

Basis quarter$977M

Final quarter$880M

Implied CAGR-2%

Share of revenue, final quarter8%

PV of segment cash flow$4.73B

Xilinx FPGAs, embedded CPUs and adaptive SoCs. $977M in the basis quarter, +19% year over year, 39.5% segment operating margin. The recovery after 2025 customer-inventory digestion. A disclosed reportable segment with its own operating profit, unlike the Client/Gaming sub-lines.

Last four quarters

2025 Q3 $857M Reported

2025 Q4 $950M Reported

2026 Q1 $873M Reported

2026 Q2 $977M Reported

Versal and other adaptive SoCsEmbedded CPUs and APUsKria SOMs and industrial, auto and A&D FPGAs

Sequential growth +8.0%/qtr decaying toward +2.0% 8% QoQ. Q1-to-Q2 was +12% off a weak Q1; 8% holds the recovery without repeating the jump.

Embedded

Latest: $880M (2031Q2E)

Period	Value
2025Q1	$823M
2025Q2	$824M
2025Q3	$857M
2025Q4	$950M
2026Q1	$873M
2026Q2	$977M
2026Q3E	$1.01B
2026Q4E	$1.04B
2027Q1E	$1.06B
2027Q2E	$1.07B
2027Q3E	$1.08B
2027Q4E	$1.08B
2028Q1E	$1.07B
2028Q2E	$1.07B
2028Q3E	$1.06B
2028Q4E	$1.04B
2029Q1E	$1.03B
2029Q2E	$1.02B
2029Q3E	$1.00B
2029Q4E	$984M
2030Q1E	$967M
2030Q2E	$950M
2030Q3E	$932M
2030Q4E	$915M
2031Q1E	$897M
2031Q2E	$880M

Assumptions & reasoning

Highest-margin disclosed segment and the smallest. Segment operating income $386M is 39.5% of $977M, published, not assumed. Terminal 40% holds that franchise rather than expanding it.
FY2025 Embedded was down 3% on customer inventory. Q2 2026 +19% is digestion ending. Opening 8% is below the Q1-to-Q2 jump on purpose.
Physical AI (Kria, Ryzen AI Embedded X100) is a content mix inside this line, not a fifth vertical. AMD has not published a robotics revenue series.

Scenarios

Where each case comes from

Su Double case — primary sources

The primary sources this case is built from — filings, calls and posts. Where they are claims by an interested party rather than disclosures, every number in the Su Double column is what happens if they are taken at face value.

AMD Q2 2026 earnings call, 4 August 2026

Valuation

From cash flow to fair value

Present value of free cash flow, 20 quarters	$16.73B
Terminal-year revenue	$46.13B
Terminal-year EBITDA	$7.35B
Exit multiple, on revenue	4.0x
Terminal value	$184.53B
Discounted at 13.0% a year, terminal value becomes	$100.16B
Enterprise value	$116.89B
Net cash	$9.88B
Equity value	$126.78B
Shares	1.66B
Fair value per share	$76.42
Against the current price of $476.67	-84%

7x terminal revenue on a mid-20s blended operating margin — about 25x that margin — for a fabless semiconductor whose Data Center line has stopped compounding at 18% a quarter. Today the equity is ~$758B at $456.75, EV ~$748B after $9.9B net cash, 18x trailing sales of $41.3B and ~15x a ~$49B FY2026. Nvidia is richer on 60-70% margins this model does not give AMD. The exit is a de-rate, and deliberately. Discount rate is 11%, a point above Nvidia, because Instinct share at Helios scale is unproven and Q2 just showed capex can double in a quarter. Move the exit multiple before anything else: at 4x and at 12x the answer moves by more than Client, Gaming and Embedded combined. Nothing here prices Anthropic's 2 GW or Meta's 6 GW as contracted cash flow; they show up only as the Data Center growth rate they can sustain.

Read the other way round: at $476.67 the market is paying 30.5x terminal-year revenue, holding every other assumption on this page fixed. That is the number to argue about.

Quarter by quarter

The projected path

Quarter	Data Center	Client	Gaming	Embedded	Revenue	YoY	EBITDA	Capex	FCF	R40	PV of FCF
2026 Q3E	$7.45B	$3.12B	$748M	$1.01B	$12.33B	+33%	$1.66B	$819M	$733M	+39	$711M
2026 Q4E	$8.08B	$3.14B	$718M	$1.04B	$12.98B	+26%	$1.79B	$821M	$846M	+33	$796M
2027 Q1E	$8.59B	$3.15B	$691M	$1.06B	$13.48B	+32%	$1.90B	$815M	$947M	+39	$864M
2027 Q2E	$8.98B	$3.14B	$664M	$1.07B	$13.85B	+20%	$1.99B	$803M	$1.03B	+28	$915M
2027 Q3E	$9.27B	$3.11B	$639M	$1.08B	$14.10B	+14%	$2.06B	$787M	$1.11B	+22	$950M
2027 Q4E	$9.46B	$3.08B	$615M	$1.08B	$14.23B	+10%	$2.11B	$767M	$1.16B	+18	$969M
2028 Q1E	$9.56B	$3.03B	$593M	$1.07B	$14.26B	+6%	$2.14B	$745M	$1.21B	+14	$976M
2028 Q2E	$9.59B	$2.98B	$571M	$1.07B	$14.21B	+3%	$2.15B	$722M	$1.24B	+11	$973M
2028 Q3E	$9.56B	$2.93B	$550M	$1.06B	$14.10B	+0%	$2.15B	$698M	$1.26B	+9	$960M
2028 Q4E	$9.49B	$2.87B	$530M	$1.04B	$13.93B	-2%	$2.14B	$674M	$1.28B	+7	$941M
2029 Q1E	$9.37B	$2.81B	$511M	$1.03B	$13.72B	-4%	$2.12B	$650M	$1.28B	+6	$916M
2029 Q2E	$9.22B	$2.75B	$493M	$1.02B	$13.48B	-5%	$2.10B	$626M	$1.28B	+4	$887M
2029 Q3E	$9.05B	$2.69B	$475M	$1.00B	$13.21B	-6%	$2.07B	$604M	$1.27B	+3	$855M
2029 Q4E	$8.86B	$2.63B	$458M	$984M	$12.92B	-7%	$2.03B	$582M	$1.26B	+3	$822M
2030 Q1E	$8.65B	$2.56B	$442M	$967M	$12.62B	-8%	$1.99B	$561M	$1.24B	+2	$787M
2030 Q2E	$8.44B	$2.50B	$426M	$950M	$12.32B	-9%	$1.95B	$540M	$1.23B	+1	$752M
2030 Q3E	$8.22B	$2.44B	$411M	$932M	$12.00B	-9%	$1.91B	$521M	$1.20B	+1	$717M
2030 Q4E	$8.00B	$2.38B	$396M	$915M	$11.69B	-10%	$1.86B	$503M	$1.18B	+1	$682M
2031 Q1E	$7.78B	$2.32B	$382M	$897M	$11.38B	-10%	$1.82B	$485M	$1.16B	+0	$648M
2031 Q2E	$7.55B	$2.26B	$368M	$880M	$11.06B	-10%	$1.77B	$468M	$1.13B	+0	$615M

Every row is projected. A year-over-year change is shown only where the quarter it compares against exists — an em dash means there is no comparable quarter, not a flat year.

Track record

Model revisions

Assumptions are marked to reality as each quarter prints. Every change is appended here, with the fair value the model produced at the time, so the model's own history stays visible.

Date	Changed	Fair value then	Note
2026-08-25	all	$360.64	Initial model. Four verticals on the disclosed Data Center / Client / Gaming / Embedded split, basis the June quarter at $11,536M, Q3 calibrated to the $13.0B ± $300M guide.