AMD vs. Intel: Which Is the Better Artificial Intelligence (AI) Chip Stock to Buy Right Now?
Key Points
AMD's data center revenue is growing faster than Intel's.
Analysts expect AMD to clock significantly stronger earnings growth than Intel in 2027.
AMD's relatively lower earnings multiple suggests it could continue to outperform Intel.
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Advanced Micro Devices (NASDAQ:AMD) and Intel (NASDAQ:INTC) have benefited from healthy demand for their artificial intelligence (AI)-oriented chips, which are being deployed by major hyperscalers in data centers to handle both training and inference workloads.
Not surprisingly, both semiconductor stocks have delivered healthy gains to investors this year, despite the brutal sell-off they have experienced lately. While AMD shares have jumped 137% in 2026, Intel has clocked respectable gains of 60% as of this writing. However, their latest results clearly indicate that one of them is stealing a march over the other in the AI chip market.
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We will examine AMD's and Intel's latest results and determine which of these two chipmakers is the better buy right now.
Image source: Getty Images.
AMD is crushing Intel in the data center market
Intel's revenue from its data center and AI (DCAI) segment increased by 78% year over year in Q3 to $7.3 billion. What's worth noting is that the company's DCAI revenue growth has been accelerating in recent quarters.
However, AMD trumped Intel with a much stronger year-over-year increase of 97% in its data center segment to $8.5 billion in the previous quarter. So, AMD is now outselling Intel in the data center segment, and that's not surprising. After all, AMD sells both server central processing units (CPUs) and graphics processing units (GPUs). At the same time, Intel seems more inclined toward server CPUs after its Gaudi series of data center GPUs failed to find much favor among customers.
Looking ahead, AMD expects stronger growth in data centers, driven by the increasing adoption of its latest MI455X graphics cards, which it has begun shipping in volume to customers, as well as its Epyc server CPUs. AMD CEO Lisa Su remarked on the latest earnings call:
Our visibility into 2027 also continues to strengthen. Last quarter, we said we expected annual server revenue to grow more than 70% and data center segment revenue to more than double for the year. Since then, customers have expanded their EPYC and Instinct deployment plans, and we have secured more supply to support that growth. We now expect server revenue to double year-over-year in 2027 and data center AI revenue to grow even faster than we projected 90 days ago.
Meanwhile, Intel management noted on the latest earnings call that it expects server CPU industry shipments to increase by more than 30% in 2026 and 2027. AMD, therefore, is growing significantly faster than the end market, indicating it is taking market share from Intel.
Moreover, AMD's guidance clearly suggests that it is a better investment compared to Intel stock. The company anticipates a 66% year-over-year increase in revenue in the current quarter to $17 billion, at the midpoint of its guidance range. On the other hand, Intel's $15.5 billion revenue guidance points to a potential jump of just 13% from the year-ago period.
Even better, AMD is projecting revenue growth of more than 80% in 2027, which is more than 2x the company's long-term growth forecast. As such, it is evident that AMD is the better semiconductor stock to buy right now, especially given that it is cheaper than Intel on a valuation basis.
Here's why AMD is a no-brainer buy over Intel
AMD stock trades at 30 times forward earnings, according to Morningstar. Intel is slightly more expensive at 35 times forward earnings. However, AMD's earnings per share (EPS) are projected to increase by 118% in 2027, well above Intel's estimated EPS growth rate of 20%.
Also, analysts have become significantly bullish about AMD's long-term EPS growth potential following its latest quarterly report.
INTC EPS LT Growth Estimates data by YCharts
The chart above indicates that even Intel's EPS could increase impressively over the long run, but AMD's lower valuation makes it the better buy. So, investors looking to buy one of these two AI stocks right now have an easy choice to make following the recent sell-off in the semiconductor sector.
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Harsh Chauhan has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Advanced Micro Devices and Intel. The Motley Fool has a disclosure policy.
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