In 2024, semiconductor stocks generally saw outsized returns on account of the artificial intelligence boom. Well, most of them did, anyway — with notable exceptions including Intel (NASDAQ: INTC) and Advanced Micro Devices (NASDAQ: AMD).
AMD faces significant competitive headwinds in AI and GPU markets, struggling against NVIDIA's dominance and custom silicon solutions from major cloud providers. Nvidia continues to dominate the business for AI accelerators, which could limit AMD's projected market share at below 5%, especially as benchmark data for MI300X disappoints. AMD's PC processor market may see a slowdown in 2025, with Intel and Qualcomm posing tough competition, especially in enterprise segments.
Advanced Micro Devices has transformed into a major player in the data center, enterprise-grade CPU, GPU, and adaptive SoCs markets, despite recent underperformance. The AI revolution, particularly OpenAI's o3 breakthrough, positions AMD's Zen-based EPYC processors and Instinct GPU accelerators for significant future growth. The Company's competitive strengths lie in its x86 CPU designs and advanced GPU architectures, with significant adoption among major cloud providers and enterprise clients.
Major U.S. equities indexes moved higher to kick off the week, with a shortened trading session on tap for Tuesday followed by a midweek day off in observance of Christmas.
Rosenblatt polled its analysts, including Steve Frankel, gathering their top picks for the first half of 2025. The stocks reflect key themes across its research universe, including the Age of Artificial Intelligence and the build-out of next-generation broadband.
Semiconductor stocks are in rally mode before Christmas , with shares of Advanced Micro Devices Inc (NASDAQ AMD) last seen up 4.6% to trade at $124.65.
Advanced Micro Devices (AMD 5.23%) stock is making gains in Monday's trading. The semiconductor company's share price was up 5.7% as of 10:45 a.m.
Advanced Micro Devices (AMD 0.28%) has split its stock six times since its IPO in 1972. If you had invested $10,000 in its initial public offering (IPO) at $15 a share, your 66 shares would have been split into 18,666 shares -- which are worth about $2.24 million today.
AMD has good and stable management, which is becoming its core strength as Intel searches for another CEO. Most analysts are estimating close to $10 billion in AI revenue by AMD for 2025, which could be an underestimate as new chips are launched next year. The demand for these chips remains very strong and AMD provides a good value alternative to Nvidia's AI chips.
The semiconductor industry has delivered tremendous growth over the last several decades. Demand for chips can experience downturns, especially during economic recessions, but history shows that more advanced devices and technologies require more powerful processors, which creates an upward-sloping demand curve.
Advanced Micro Devices, Inc. stock has struggled over the last 12 months and has recently sold off further. The company has made impressive strides in maintaining its lead in the server CPU market and closing the gap with Nvidia in the GPU accelerator market. Shares offer favorable risk-reward at these levels.
AMD stock has struggled to regain momentum as investors are increasingly concerned about its AI growth inflection. Broadcom and Marvell unveiled robust AI revenue outlook recently, corroborating their positions as significant challengers against AMD. Nvidia's Blackwell AI chips are expected to scale and move into volume production and delivery through 2025, heightening AMD's execution risks.