Advanced Micro Devices Inc. and Intel Corp. shares rallied in recent trading, with both semiconductor giants seeing stock price increases of over 5 percent. The surge reflects growing investor confidence in the sector, fueled by the relentless demand for artificial intelligence hardware and strategic government support for domestic manufacturing.
AMD’s stock price climbed 5.36 percent to close at $430.365, pushing its total market capitalization to $701.8 billion. Intel experienced a similar boost, with its shares rising 5 percent to $115.08, for a market value of $578.4 billion. The gains underscore a bullish sentiment for CPU and GPU manufacturers who are pivotal to the AI supply chain.
The rally in AMD comes on the heels of a strong first-quarter financial report that saw data center revenue jump by a staggering 57 percent year-over-year to $5.8 billion. This acceleration, up from 39 percent growth in the previous quarter, highlights the significant momentum in AI chip sales. The company's upcoming MI450 series of AI accelerators is expected to further challenge Nvidia's dominance, with major customers like Meta Platforms and Microsoft already signed on.
“Demand continues to strengthen, with a number of new customers inquiring about large-scale deployments,” AMD Chief Executive Officer Lisa Su said recently, signaling a robust pipeline for its next-generation AI hardware. Su anticipates the data center business will grow at a compound annual rate of at least 80 percent as shipments of the new chips ramp up into 2027.
For investors, the question is whether this growth is already priced in. AMD currently trades at a price-to-earnings ratio of 92, nearly double that of market leader Nvidia. While Wall Street analysts project AMD's earnings to grow significantly, the premium valuation presents a high bar. However, the sustained, explosive growth in AI workloads provides a powerful tailwind.
Intel, meanwhile, is executing a multi-year turnaround plan under CEO Pat Gelsinger. The company's stock jump follows a broader positive trend for US-based chipmakers, partly driven by funding from the CHIPS and Science Act aimed at restoring America's leadership in semiconductor manufacturing. While Intel has been playing catch-up to rivals like AMD and TSMC in advanced process technology, its renewed focus on foundry services and domestic production is gaining traction with investors.
The broader semiconductor industry remains a key battleground for technological supremacy, with companies pouring billions into research and development. The performance of both AMD and Intel stocks suggests that investors see room for multiple winners in an expanding market for high-performance computing.
This article is for informational purposes only and does not constitute investment advice.
