Reality check is catching up for AMD, Street is impressed, says Patrick Moorhead

Core Insights - Anthropic plans to invest $50 billion in building AI infrastructure across the nation, highlighting the escalating competition in AI spending [1] - AMD's stock surged by 10% after the company projected a 35% annual revenue growth in the AI data center market, which is expected to reach a trillion dollars by 2030 [1] Company Performance - AMD's recent financial performance has led to a reevaluation of its market position, with an average price increase of about $11, bringing the stock to around $295 [3] - The company is expected to achieve gross margins of 55% to 58% and operating margins of 35%, which has impressed market analysts [3] Market Dynamics - There is ongoing scrutiny regarding the funding and sustainability of AI investments, particularly as companies like Oracle, Meta, and Google are increasingly reliant on debt issuance rather than cash flow [5] - The market is cautious about the potential impacts of large private companies' spending on AI, with calls for more transparency on funding sources [9] Future Outlook - Anthropic's revenue forecasts suggest it could rival OpenAI within the next three years, indicating strong growth potential in the AI sector [7] - Companies like Microsoft and IBM are also showing promising numbers beyond just infrastructure, which is a positive sign for the industry [8]