AMD’s shares surged by over 10% following the company’s recent announcement of its next-generation artificial intelligence chips, the Instinct MI400 series. The market responded favorably. This boom followed closely on the heels of Piper Sandler punching up its price target for AMD’s stock from $125 to $140. On Monday, AMD’s share price shot above $127, the highest price since January 6.
AMD’s stock is sky-high following the launch of the Instinct MI400 series. This advance gives the company a powerful foothold in the booming AI market. On top of that, AMD announced a full-server rack dubbed Helios, aimed at allowing thousands of its chips to operate in unison. Analysts at Piper Sandler expressed enthusiasm for these developments, stating, “Overall, we are enthused with the product launches at the AMD event this week, specifically the Helios rack, which we think is pivotal for AMD Instinct growth.”
Despite this positive momentum, AMD’s stock performance had struggled through much of the year. Then President Donald Trump announced his first round of major new tariffs, and the pandemic struck the company hard. In doing so, their share value plummeted by 90%. Additionally, AMD had already warned of large charges over chip control before the stock plummet came.
For AMD, the company expects to incur approximately $800 million in charges. This is a consequence of the Biden administration’s new U.S. license requirement on semiconductor exports to China and other countries. This requirement is tied to ongoing chip control and export restrictions, which have affected the company’s operations and market perception. While walking this tightrope, the company asserted that it will eat these costs while it continues to find a regulatory path.