AMD Stock Looks Strong. One Supply Chain Bottleneck Could Change That - Trefis

AMD's stock has surged nearly fourfold over the past year, with its market cap approaching $90 billion, driven by strong demand for its EPYC processors in the server market and the competitive edge of... Read original →

AMD’s lofty valuation hinges on AI chip demand that’s now colliding with a hard ceiling: acute CoWoS packaging scarcity. Technically, this bottleneck not only caps MI400 shipments but also delays EPYC’s migration to 3nm with SoIC-X, eroding its interconnect edge against NVIDIA’s Grace Hopper. Geopolitically, TSMC’s (Taiwan, China) capacity expansion faces EUV export controls and local energy constraints, pushing new supply out by at least 24 months. NVIDIA, commanding 60% of CoWoS output, has effectively built a packaging moat—securing Blackwell and GB200 ramp—while AMD scrambles to ration scarce capacity between CPUs and GPUs. Without a credible alternative via ASE or Samsung OSAT for heterogeneous integration within 18 months, AMD’s AI training share will keep shrinking, making its 70x+ forward P/E unsustainable.