Palantir Technologies has experienced a remarkable ascent in the stock market, currently ranking as the 22nd largest company globally with a market capitalization of nearly $426 billion. Its stock has surged by more than 945% since the beginning of 2024, highlighting its growing influence in the tech sector. However, despite these impressive numbers, some analysts caution that Palantir’s current stock price may not be sustainable.
The company reported a 48% year-over-year increase in revenue for the second quarter of 2025, yet its price-to-sales ratio stands at an astonishing 132. This valuation appears steep compared to peers in the market that are not only growing faster but are also trading at lower multiples. Consequently, there are predictions that Palantir may face challenges in maintaining its stock’s upward trajectory over the next five years unless it significantly boosts its growth rate.
In contrast, Advanced Micro Devices (AMD), with a market cap of $260 billion—about 64% lower than Palantir’s—is positioned to gain more ground thanks to favorable conditions in the AI chip and gaming console markets. AMD boasts a much lower price-to-sales ratio of just 9, signaling more value relative to its earnings. The company experienced a 32% increase in revenue during the second quarter of 2025, totaling $7.7 billion, with nearly half of its revenue coming from the client and gaming segments, which grew by an impressive 69%.
Looking ahead, AMD is expected to benefit from two major catalysts in its client and gaming segment. First, the burgeoning AI-capable PC market is projected to expand 4.5 times by 2030. As the second-largest player in the PC CPU market, AMD has increased its unit market share to almost 24%, positioning the company to capture more of the market from competitive giants like Intel.
The anticipated release of new gaming consoles in 2028 also represents a significant opportunity for AMD. Historically, the company has designed the custom chips for major consoles from Microsoft and Sony. Its revenue from semi-custom chips for the existing console generation was around $5 billion in 2021, indicating strong potential for increased earnings with the new generation looming.
Furthermore, AMD’s data center segment is producing 41% of its total revenue, which rose by 14% year over year in the latest quarter. The ongoing adoption of server CPUs and GPUs for AI applications is expected to bolster this segment significantly. AMD is also preparing to introduce more competitive data center GPUs to rival Nvidia, driving additional growth.
If AMD continues to grow its revenue at solid double-digit rates, especially with the expected boost from the new gaming consoles and its expansion in PC and server markets, analysts project that the chipmaker’s revenue could reach nearly $72 billion by the end of 2030. Based on the U.S. technology sector’s average sales multiple of 9.2, this could translate to a market cap of approximately $662 billion, potentially surpassing Palantir’s value within the next decade.
In light of these developments, investors interested in leveraging opportunities within the AI revolution may find AMD to be a particularly attractive option as it continues to show promise for substantial growth in the evolving tech landscape.
