Why Is AMD (AMD) Stock Rocketing Higher Today

What Happened?

Shares of computer processor maker AMD (NASDAQ:AMD) jumped 7.7% in the morning session after the stock rebounded from a steep plunge that was triggered by its recent earnings report. 

The initial sell-off, which saw the stock fall by more than 20%, occurred despite the company reporting strong fourth-quarter results. During that quarter, sales grew 34% and earnings per share rose 40% compared to the previous year, beating expectations. However, the company's forecast for the first quarter disappointed investors. AMD projected sales of about $9.8 billion, which signaled a slowdown from its record fourth quarter. This guidance did not meet the high growth expectations investors had, particularly for its business in the artificial intelligence (AI) market, leading to the sharp decline. The subsequent recovery suggested that some investors saw the sell-off as a buying opportunity.

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What Is The Market Telling Us

AMD’s shares are extremely volatile and have had 32 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 11 days ago when the stock dropped 3.3% on the news that Microsoft unveiled its latest AI chip to reduce reliance on established chipmakers. Microsoft announced its Maia 200 chip, an AI accelerator built on an advanced process, intended to serve multiple AI models, including new ones from OpenAI. This development signaled a move by a major tech company to bring its chip design in-house, potentially shrinking the market for third-party suppliers and increasing competitive pressure.

AMD is down 7.1% since the beginning of the year, and at $207.58 per share, it is trading 21.5% 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 $2,269.

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