Why AMD Stock Is Sinking Today

Key Points

• AMD stock was down almost 5% earlier in today's trading, but it's seen a significant recovery.

• The company's share price is seeing a small pullback today in conjunction with broader valuation trends in the chip industry.

• AMD is set to report its Q2 results on Aug. 5, and the stock could make big moves depending on the company's performance in the AI data center market.

• 10 stocks we like better than Advanced Micro Devices ›

Advanced Micro Devices (NASDAQ: AMD) stock has headed lower in Tuesday's trading, but it's also regained some ground from sell-offs at the beginning of the session. The semiconductor company's share price was down 1.5% as of 3 p.m. ET in the context of flat trading for the S&P 500 index and a 0.3% decline for the Nasdaq Composite index. The stock had been off as much as 4.9% near the start of trading.

After hitting a record high in yesterday's trading, the Nasdaq Composite is seeing a modest pullback today. Sell-offs for chip stocks including AMD played a big role in pushing the index significantly lower early in trading, but there has been a valuation recovery trend as the day has progressed.

Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Learn More »

Image source: Getty Images.

AMD stock slips as tech rally takes a breather

Tech sector valuations have generally been red-hot lately. Encouraging corporate earnings reports and industry performance tracking and expectations that the Federal Reserve will now issue multiple cuts to the benchmark interest rate have helped bolster share prices, but valuations for AMD and many other chip stocks are taking a modest step back today.

In addition to profit taking on the heels of the Nasdaq Composite hitting a record high in Monday's session, a report from The Wall Street Journal on the Stargate artificial intelligence (AI) initiative appears to be a factor in the sell-off. Stargate is a $500 billion AI investment collaboration between Softbank, OpenAI, Oracle, and MGX aimed at strengthening U.S. artificial intelligence infrastructure, but it's reportedly run into some early road blocks -- and near-term expansion plans are said to have been pared back.

What's next for AMD?

Renewed excitement surrounding the company's opportunities in the AI space has helped power a strong rally for AMD stock recently, and the company's share price is up roughly 81% over the last three months even with today's pullback. Investors won't have to wait long to get a closer look at the company's progress in the AI data center space.

AMD is scheduled to report its second-quarter earnings after the market closes on Aug. 5. Performance expectations have been elevated following the company's valuation run-up, but the launch of the company's MI350 processor and some encouraging information shared at its Advancing AI conference last month suggest the company could have some good news to share in the report.

Should you invest $1,000 in Advanced Micro Devices right now?

Before you buy stock in Advanced Micro Devices, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Advanced Micro Devices wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $665,092!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,050,477!*

Now, it’s worth noting Stock Advisor’s total average return is 1,055% — a market-crushing outperformance compared to 180% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of July 21, 2025

Keith Noonan has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Advanced Micro Devices and Oracle. The Motley Fool has a disclosure policy.