Advanced Micro Devices has had a stellar year so far. But the reaction to its earnings report is a painful reminder that it still has a way to go to catch up with artificial-intelligence chip leader Nvidia.

AMD shares were down around 5% on Wednesday following its earnings the previous day. It’s not that they were bad but the bar is getting higher after the stock has more than doubled in 2026 so far.

The big question hangs over AMD’s ability to take market share from Nvidia’s graphics-processing units. The test is coming soon as AMD’s Helios AI server racks containing its latest GPUs are scheduled to arrive on the market in the second half of 2026.

On the face of it, AMD looks well placed. It has already signed up Meta Platforms, OpenAI, and Anthropic as customers for a total of 14 gigawatts worth of computing capacity powered by its GPUs.

However, there is a catch. As part of those deals, AMD has issued warrants entitling Meta and OpenAI to up to 160 million shares each. The customers can get the full allotment if they both deploy six gigawatts worth of AMD’s GPUs and AMD’s stock hits a series of price levels up to $600 a share.

Assuming the full warrant conditions were reached, AMD is set to hand over $192 billion in equity value to Meta and OpenAI, arguably financing their investments. That’s not the kind of deal Nvidia has been brokering—in fact, the chip maker has structured its own “circular financing” deals in such a way that it receives stakes in many of its customers.

Of course, AMD would argue that if the warrants are the price of getting major customers to adopt its chips rather than Nvidia’s on a major scale then it’s well worth paying. AMD estimates it can generate “double-digit billions” in revenue from each gigawatt of computing capacity powered by its chips. That means it can expect a minimum of $140 billion in revenue from the 14 GW commitments it has secured so far.

Still, all of that hoped-for revenue depends on AMD’s Helios racks performing as expected.

“Shares of AMD are trading down…as investors digest the more moderate upside and wait for clearer signs that the Helios platform is ramping up well and helping drive share gains in the AI accelerator market,” wrote William Blair analyst Sebastien Naji in a research note.

Naji has a Market Perform rating on AMD stock, arguing its premium valuation—it trades at a forward price-to-earnings multiple of more than 40 times compared with less than 20 times for Nvidia—means risk and reward are fairly equally balanced.