AMD and Applied Materials in AI trillion-cap race

Advanced Micro Devices (AMD) and Applied Materials (AMAT) are both featured on a list of 15 AI stocks that could break the trillion dollar market capitalization barrier. AMD ranks fourth on the list, while Applied Materials ranks eighth, underscoring investor attention on different parts of the AI hardware stack.

The articles emphasize that these companies are drawing interest from major investors who see large potential market opportunities tied to AI training, advanced process technologies, and high-bandwidth memory.

Top investors on Wall Street are described as betting that 2026 could be the year AMD challenges NVIDIA’s (NVDA) dominance in high-end AI training. The announcement of the MI450 GPU series, with AMD targeting volume rollouts later in 2026, has positioned AMD as a direct competitor to NVIDIA’s (NVDA) Blackwell architecture.

Institutions are watching reports that the MI450 has achieved parity in software compatibility with rival offerings, supported by improvements in AMD’s ROCm ecosystem. This software progress is viewed as important for adoption across AI workloads.

Major hedge funds are tracking large GPU orders from OpenAI, Meta (META), and Oracle Cloud. Oracle’s (ORCL) recent 50,000-GPU cluster order is cited as a key validation of AMD’s hardware at scale for AI training deployments.

Beyond GPUs, AMD is gaining share in server CPUs. Its server CPU revenue share reached a record 41.3% in the fourth quarter of 2025, according to the article. The upcoming Venice (Zen 6) server CPU, expected later in 2026, is anticipated by analysts to drive a major refresh cycle in data centers.

Investment banks have responded with more optimistic long-term forecasts. In early 2026, several top-tier banks raised their projections for AMD, and Goldman Sachs (GS) recently lifted its 2027 revenue estimate to $68.7 billion, citing deployment scale at OpenAI, Meta (META), and Oracle (ORCL).

Analysts referenced in the article project AMD’s earnings per share could rise from roughly $5.93 in 2026 to over $10 in 2027. The stock is noted as trading at about 24 times forward 2027 earnings and is often described as a cheaper way to gain exposure to AI compared with NVIDIA’s (NVDA) higher revenue multiples.

Applied Materials is described as the world’s leading provider of materials engineering solutions used to build the advanced chips designed by companies such as NVIDIA and AMD. The company is viewed as a prime beneficiary of the semiconductor industry’s move from FinFET to gate-all-around transistor architectures.

According to CEO Gary Dickerson, GAA nodes significantly expand Applied’s available market. The transition increases the number of process steps where the company is a market leader, and investors expect Applied to gain multiple points of market share as chipmakers ramp 2 nm and 3 nm designs in late 2026.

Applied Materials is also framed as a way to invest in memory, particularly high-bandwidth memory. HBM requires three to four times more wafer starts than standard DRAM and depends heavily on advanced packaging technologies such as through-silicon vias.

Management at Applied expects advanced packaging revenue tied to HBM and 3D chiplet stacking to be among its fastest-growing segments in 2026. Reports that a team associated with Elon Musk has contacted Applied for specialized chip-equipment supplies are cited as signaling a potential new demand source for its tools.

Across both AMD and Applied Materials, the articles highlight how AI training needs, next-generation process nodes, and complex memory and packaging requirements are converging to create substantial growth opportunities in the semiconductor ecosystem.