Advanced Micro Devices (NASDAQ:AMD) Trading Down 7.3% - Here's What Happened

Key Points

• AMD shares fell 7.3% in Tuesday trading, with the stock dropping as low as $507.25 after closing at $547.26 the prior day. Trading volume was also below average, suggesting the move may have been driven more by profit-taking than heavy conviction selling.
• Despite the pullback, the company continues to benefit from bullish AI-related developments, including a deal with Rackspace Technology to deploy AMD-based AI compute and the acquisition of MEXT to help address AI memory bottlenecks. These moves reinforce AMD’s push deeper into enterprise AI infrastructure.
• Wall Street remains largely constructive: multiple firms recently raised targets or reiterated buy ratings, and MarketBeat shows a consensus rating of Moderate Buy with an average price target of $428.65. However, the stock’s high valuation and some insider selling are adding caution to sentiment.

Advanced Micro Devices, Inc. (NASDAQ:AMD - Get Free Report)'s stock price fell 7.3% during mid-day trading on Tuesday . The company traded as low as $507.25 and last traded at $507.29. 28,099,947 shares were traded during trading, a decline of 26% from the average session volume of 38,054,625 shares. The stock had previously closed at $547.26.

Advanced Micro Devices News Roundup

Here are the key news stories impacting Advanced Micro Devices this week:

• Positive Sentiment: AMD announced a definitive agreement with Rackspace Technology to deploy an initial 30 MW of AMD-based AI compute across Rackspace data centers, a sign that AMD is expanding deeper into enterprise AI infrastructure and could drive more chip demand. Article Title
• Positive Sentiment: AMD’s recent MEXT acquisition is being viewed as a strategic move to address AI memory bottlenecks, reinforcing the company’s AI roadmap and supporting bullish sentiment around future product performance. Article Title
• Positive Sentiment: Analysts remain constructive, with recent buy/overweight ratings and higher price targets highlighting expectations for stronger GPU and CPU sales as AI demand broadens. Article Title
• Neutral Sentiment: ARK Invest trimmed its AMD position, but the move appears portfolio-driven rather than a direct change in AMD’s fundamentals, as Cathie Wood redirected capital toward SpaceX. Article Title
• Neutral Sentiment: Some commentary is turning cautious, with one Seeking Alpha piece warning AMD may be “precariously close to the cliff,” reflecting valuation concerns after a big run. Article Title
• Negative Sentiment: Profit-taking appears to be weighing on AMD after a sharp rally, with traders rotating out of the stock despite ongoing AI optimism. Article Title
• Negative Sentiment: Insider-trading data showing repeated executive sales over the past six months may also be adding pressure to investor sentiment. Article Title

Analyst Ratings Changes

A number of research firms recently issued reports on AMD. Stifel Nicolaus boosted their price objective on Advanced Micro Devices from $320.00 to $450.00 and gave the company a "buy" rating in a research note on Wednesday, May 6th. Needham & Company LLC upgraded Advanced Micro Devices to a "buy" rating in a research note on Wednesday, May 6th. Sanford C. Bernstein assumed coverage on Advanced Micro Devices in a research note on Friday. They issued an "outperform" rating on the stock. Roth Mkm restated a "buy" rating and issued a $500.00 target price on shares of Advanced Micro Devices in a research note on Wednesday, May 6th. Finally, Wedbush upped their target price on Advanced Micro Devices from $290.00 to $400.00 and gave the stock an "outperform" rating in a research note on Monday, May 4th. One research analyst has rated the stock with a Strong Buy rating, thirty have assigned a Buy rating, twelve have assigned a Hold rating and one has issued a Sell rating to the company's stock. According to MarketBeat, Advanced Micro Devices has a consensus rating of "Moderate Buy" and an average price target of $428.65.

Advanced Micro Devices Price Performance

The business has a fifty day moving average price of $393.01 and a 200-day moving average price of $277.00. The company has a current ratio of 2.72, a quick ratio of 1.96 and a debt-to-equity ratio of 0.04. The stock has a market capitalization of $828.31 billion, a PE ratio of 166.55, a PEG ratio of 1.50 and a beta of 2.50.

Advanced Micro Devices (NASDAQ:AMD - Get Free Report) last posted its quarterly earnings data on Tuesday, May 5th. The semiconductor manufacturer reported $1.37 earnings per share (EPS) for the quarter, topping analysts' consensus estimates of $1.29 by $0.08. Advanced Micro Devices had a return on equity of 9.55% and a net margin of 13.37%.The firm had revenue of $10.25 billion during the quarter, compared to analysts' expectations of $9.90 billion. During the same period in the prior year, the business earned $0.96 EPS. The company's revenue for the quarter was up 37.8% compared to the same quarter last year. Research analysts expect that Advanced Micro Devices, Inc. will post 6.2 EPS for the current fiscal year.

Insider Transactions at Advanced Micro Devices

In related news, EVP Paul Darren Grasby sold 24,376 shares of the stock in a transaction dated Friday, May 8th. The stock was sold at an average price of $444.39, for a total transaction of $10,832,450.64. Following the completion of the sale, the executive vice president directly owned 105,222 shares in the company, valued at $46,759,604.58. This represents a 18.81% decrease in their position. The sale was disclosed in a legal filing with the SEC, which is available through this link. Also, EVP Forrest Eugene Norrod sold 19,487 shares of the stock in a transaction dated Wednesday, May 20th. The shares were sold at an average price of $431.40, for a total value of $8,406,691.80. Following the sale, the executive vice president owned 324,527 shares of the company's stock, valued at $140,000,947.80. This represents a 5.66% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. In the last three months, insiders sold 372,032 shares of company stock worth $158,658,616. Company insiders own 0.50% of the company's stock.

Institutional Investors Weigh In On Advanced Micro Devices

Institutional investors have recently bought and sold shares of the stock. Joseph Group Capital Management purchased a new stake in Advanced Micro Devices during the 4th quarter valued at about $25,000. Cornerstone Financial Management LLC purchased a new stake in Advanced Micro Devices in the 4th quarter worth approximately $27,000. Sarver Vrooman Wealth Advisors purchased a new stake in Advanced Micro Devices in the 4th quarter worth approximately $27,000. Basepoint Wealth LLC purchased a new stake in Advanced Micro Devices in the 4th quarter worth approximately $30,000. Finally, Graney & King LLC purchased a new stake in Advanced Micro Devices in the 1st quarter worth approximately $31,000. 71.34% of the stock is currently owned by hedge funds and other institutional investors.

About Advanced Micro Devices

Advanced Micro Devices, Inc NASDAQ: AMD is a global semiconductor company that designs and sells microprocessors, graphics processors, chipsets and adaptive computing solutions for a broad set of markets. The company's product portfolio includes consumer and commercial CPUs under the Ryzen and Threadripper brands, data center processors under the EPYC brand, and Radeon graphics processing units for gaming and professional visualization. AMD also offers semi-custom system-on-chip (SoC) products for gaming consoles and other specialized applications, and provides supporting software and platform technologies for OEMs, cloud service providers and end users.

Founded in 1969, AMD has evolved from a supplier of logic chips into a diversified, fabless semiconductor designer.

This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to contact@marketbeat.com.