AMD's stock jumped Monday, pushing its market capitalization above $1 trillion for the first time. The move caps a five-day rally built on strong AI chip demand and comes as rival chipmakers Arm and Intel also surge on the same trade.
Advanced Micro Devices stock surged 9% on Monday, pushing shares to a record high and lifting the company's market capitalization above $1 trillion for the first time. The chip giant's shares hit an intraday high of $613.92.
AMD is riding a five-day winning streak, during which shares have gained about 24%. The rally follows a pullback last month after the company's second-quarter results beat expectations.
AI chip demand drives the rally
AMD reported Q2 revenue of $11.54 billion, up 50% from $7.69 billion a year earlier, with its AI chips at the center of that growth. Its Data Center unit posted sales of $6.7 billion, up 107% from a year ago.
The chipmaker is up more than 180% so far this year, though it remains well behind Nvidia, which carries a market cap of about $5.4 trillion.
AMD CEO Lisa Su said last month that the company expects to double data center sales in 2027. Nvidia CEO Jensen Huang made a similar point last week, saying he expects his company to double the number of chips it sells next year.
AMD becomes the 14th trillion-dollar U.S. company
AMD shares traded as high as $615.99 intraday, a level that pushed its market cap above $1 trillion, before pulling back to $609.32; the stock needed to close above $612.56 to finish the session in trillion-dollar territory. Only 13 other U.S. companies have crossed the $1 trillion mark, making AMD the 14th. The company was worth $255 billion at this point last year.
Arm and Intel ride the same wave
Arm Holdings shares jumped 13% to $312.46 and Intel climbed 12% to $121.38 alongside AMD, according to 24/7 Wall St. Intel CEO Lip-Bu Tan said last week that the company can currently meet only 50% of customer demand.
Arm has estimated the server CPU market could reach $120 billion by 2030. Unlike Arm, which earns royalties on chip designs, and Intel, which manufactures its own processors, AMD designs its chips and has them built by outside foundries.
Mizuho analyst Daniel O'Regan said recent AI industry headlines "reinforce expectations for sustained AI infrastructure spending".
Sources: CNBC, MarketWatch, 24/7 Wall St.
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