Shares of Advanced Micro Devices climbed roughly 4% on Monday after Wedbush analyst Matt Bryson reiterated his Outperform rating and raised his 12-month target by 18% to $290 per share. Bryson emphasized that AMD’s opportunity does not hinge on overtaking Nvidia’s dominant position in AI accelerators; instead, solid growth in its CPU franchise alone—powered by strong PC and data-center demand—can deliver significant shareholder gains.

Investors are focused on AMD’s February 3 earnings announcement, where management is expected to report robust fourth-quarter revenue in its Computing and Graphics segment alongside a continued ramp of EPYC data-center processors. Wedbush projects that server CPU sales could account for more than half of AMD’s total quarterly revenue, driven by deployments at major cloud and enterprise customers. The conference call at 5:00 p.m. EST will be scrutinized for commentary on unit shipments, average selling prices and guidance for the first quarter.

Bryson highlighted that tight supply in the server CPU market should enable AMD to command premium pricing, supporting a gross margin above its current 44.3% level. The analyst’s model assumes a sequential improvement of 200 basis points in gross margin, reflecting the company’s ability to prioritize high-margin EPYC sales. This dynamic could translate into operating leverage, with Wedbush forecasting a 25% year-over-year increase in operating income for the quarter.

January’s easing of U.S. export restrictions has reopened a key growth avenue for AMD, with Bryson estimating that incremental sales to Chinese cloud and telco customers could add as much as $300 million in quarterly revenue. While the full impact will depend on end-user certifications and logistics ramp-up, this opportunity offers a non-U.S. revenue tailwind that could further bolster AMD’s top-line and diversify its geographic exposure.