It’s Time to Revisit The Nvidia Vs. AMD Debate
NVIDIA crushed earnings and AMD nearly doubled its data center revenue, yet their stock returns tell completely opposite stories. Which company's growth engine actually justifies what investors are paying for it right now?
NVIDIA (NASDAQ:NVDA | NVDA Price Prediction) and AMD (NASDAQ:AMD) both beat expectations in their latest earnings reports. Both also say AI demand is running ahead of supply. NVIDIA posted revenue of $96.22B, up 105.8%. AMD delivered $11.54B, up 50.1%. Even so, AMD stock is up 164.48% year to date, while NVIDIA is up 14.83%. That gap traces back to how investors value each company’s growth drivers.
Rubin Ramps at NVIDIA While AMD Readies Helios
NVIDIA’s Data Center segment brought in $89.02B, up 117%. Networking alone reached $40.31B, up 138%. That tells me customers are buying entire AI factories, switches included. Vera Rubin began production shipments in August, but supply still limits growth. Jensen Huang said, “Even though our demand is much greater than 70%, our supply allows us to confidently deliver 70%.”
AMD’s Data Center sales rose 107% to $6.72B, which is now 58% of revenue. That shift in mix drove non-GAAP gross margin up to 56%. EPYC server chips set a record for the fifth straight quarter. Lisa Su said demand for Helios racks is “tracking ahead of our initial forecast.” Gaming was the weak spot. It fell 31% to $779 million as the current console cycle ages.
| Business Driver | NVIDIA | AMD |
|---|---|---|
| Main Growth Engine | Blackwell Ultra, Vera Rubin | EPYC CPUs, Instinct GPUs |
| Marquee Commitment | AWS adding 2 million GPUs | Anthropic, up to 2 gigawatts |
| Non-GAAP Gross Margin | 75.0% | 56% |
| Weak Spot | No China in outlook | Gaming decline |
Full-Stack Fortress Versus a Two-Engine Challenger
Huang brushed aside rivals’ custom chips: “Many of these XPUs are inference-specific chips for one cloud or one service. NVIDIA is a platform.” NVIDIA also puts its balance sheet to work. It has invested nearly $50 billion in advanced AI labs. Huang noted that critics call this “circular financing.” I share some of that concern, because days sales outstanding extended to 60 days from 45.
AMD sells CPUs and GPUs side by side. It expects its data center segment to more than double in 2027. The company says Helios delivers up to 30% more tokens per dollar than the competition. One warning: CFO Jean Hu said data center AI gross margin stands slightly below the corporate average. That means faster GPU growth could slow further margin gains.
Memory Costs and Helios Yields Set the Next Round
NVIDIA forecast third-quarter revenue to $108 billion, with no China data center computing included. It expects gross margin to bottom at 71% to 72% in the fourth quarter as memory costs rise. NVIDIA also faces news of a competition probe. For AMD, I’m watching two things: whether Helios yields improve on schedule, and whether third-quarter revenue lands near the $13 billion guidance.
NVIDIA’s Margins Versus AMD’s Premium Valuation
NVIDIA trades at about 43 times earnings. AMD trades near 213, a price that assumes Helios comes through well before it ships in volume. Analysts did raise AMD’s 2027 EPS consensus to $15.7629 from $13.4921 90 days ago.
NVIDIA’s case rests on its 75.0% margins and $21.34B in quarterly free cash flow. AMD’s case rests on executing a complex rack launch. A smooth Helios ramp, with margins holding at 56%, would improve AMD’s case.
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Alex Sirois is a financial writer with experience spanning both retail and institutional investing. He has written for InvestorPlace and held roles at BNY Mellon and Bernstein, giving him a perspective that bridges Main Street portfolios and Wall Street analysis.
Alex holds an MBA from George Washington University and has built his career across multiple industries, including e-commerce, education, and translation — a breadth of experience that informs how he breaks down complex financial topics for everyday investors. His writing is conversational, actionable, and grounded in long-term, buy-and-hold investing principles.
At 247 Wall St., Alex focuses on delivering analysis that is both accessible and useful, with a clear emphasis on helping readers make more informed decisions with their money.
