What Happened?
Shares of computer processor maker AMD (NASDAQ:AMD) jumped 5.7% in the afternoon session after the company announced groundbreaking Ryzen AI test results, fueling optimism about its position in the artificial intelligence market.
The new Ryzen AI processors featured a neural processing unit (NPU) with a performance of 10.5 tera operations per second, outpacing many rivals. This news was met with positive reactions from financial analysts. Wells Fargo reiterated its Overweight rating on the stock, naming AMD its top pick for 2026, pointing to the company's leadership in CPUs and its growing strength in the AI space.
Additionally, RBC Capital initiated coverage with a 'Sector Perform' rating. The enthusiasm was partly tied to the 'insatiable data center compute demand' that is expected to benefit AMD's product roadmap throughout the year. This development supported the view that AMD’s data center CPUs were a key growth driver for the company.
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What Is The Market Telling Us
AMD’s shares are extremely volatile and have had 31 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 2 days ago when the stock gained 6.9% on the news that KeyBanc upgraded the stock to Overweight from Sector Weight, citing a significant surge in demand for the company's server chips used in artificial intelligence. Analyst John Vinh raised the price target to $270. The upgrade followed supply chain checks that revealed intense demand from large-scale data center operators, known as hyperscalers. This demand was so strong that it led to AMD being almost completely sold out of its server central processing units (CPUs) for 2026. Because of this, the company was reportedly considering a price increase of 10% to 15% in the first quarter. The analyst estimated that AMD's server CPU business would grow by at least 50% during the year.
AMD is up 6% since the beginning of the year, but at $236.78 per share, it is still trading 10.4% below its 52-week high of $264.33 from October 2025. Investors who bought $1,000 worth of AMD’s shares 5 years ago would now be looking at an investment worth $2,684.
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