Morgan Stanley has raised its outlook for several top chipmakers, citing continued strength in artificial intelligence (AI) demand that is accelerating across both supply and customer pipelines.
Analyst Joseph Moore reiterated his bullish stance on Nvidia and Broadcom, and modestly raised his expectations for Advanced Micro Devices (AMD), highlighting optimism for the second half of the year as the AI sector continues to grow at a rapid pace.
Nvidia sees momentum ahead of Blackwell launch
Nvidia (NASDAQ: NVDA) remains a standout in the AI semiconductor space, with Moore lifting his price target on the stock to $200 from $170, implying roughly 14% upside from Tuesday’s close.
The analyst maintained his “overweight” rating and pointed to strong trends in both supply and demand.
“AI strength is exceptional in both supply and demand. All of our data points and contacts are telling us that customers need more compute,” Moore noted in his report.
He also emphasized an acceleration in inference workloads, which has become a key driver of chip usage as more AI models move into deployment phases.
Moore sees significant upside in the second half of the year, largely driven by the upcoming Blackwell product cycle, which includes next-generation processors, as well as improvements in connectivity, networking, and memory solutions.
Nvidia shares have already climbed nearly 31% year-to-date.
Earlier this month, the company announced it will begin deliveries of its H20 general processing units (GPUs) to China “soon,” following export-related setbacks.
Back in April, Nvidia said it would take a $5.5 billion quarterly charge due to export restrictions to China, but the resumption of some product flows appears to be a new tailwind.
Nvidia stock has risen 26% in the year so far.
AMD gains on product momentum and China tailwind
Advanced Micro Devices (NASDAQ: AMD) has outpaced Nvidia so far in 2025, with a year-to-date gain of 47%.
While Moore maintained an “equal weight” rating on AMD, he raised his price target from $121 to $185, signaling potential for more than 4% additional upside.
“The reinstatement of products for the China market has added a new tailwind for AMD/NVDA in the second half,” Moore wrote.
He expressed optimism about AMD’s Mi350 product cycle, which he believes will offer meaningful upside as cloud infrastructure providers continue to ramp up spending.
Although Moore favors Nvidia as the main beneficiary of surging AI investment, AMD is positioned to capture incremental gains from the broader demand surge and newly available opportunities in the Chinese market.
Broadcom benefits from AI-driven networking demand
Broadcom (NASDAQ: AVGO) also received a bullish update from Moore, who raised his price target to $338 from $270, representing more than 13% upside from current levels.
He reiterated an “overweight” rating on the stock, which has already advanced over 28% year-to-date.
Unlike Nvidia and AMD, whose gains are largely tied to processors, Broadcom is expected to benefit from the AI boom via the networking segment.
Moore stated that the company’s upside would come “primarily from the networking side rather than processors,” reflecting the critical role of data transfer and bandwidth optimization in large-scale AI systems.
As AI investments from cloud providers and enterprises expand, Moore believes the broader semiconductor sector will see continued strength in the second half of the year, with Nvidia, AMD, and Broadcom among the biggest beneficiaries.
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