AMD’s stellar report fuels chip stock rally

1 min read
FILE PHOTO: Signs of AMD are seen at the China Digital Entertainment Expo and Conference, also known as ChinaJoy, in Shanghai

By Noel Randewich

– Shares of chipmakers Nvidia Corp, Qualcomm Inc and Micron Technology Inc got a lift in extended trade on Tuesday after Advanced Micro Devices Inc reported strong quarterly demand for its semiconductors, despite global supply snags.

AMD soared almost 11% after it provided an annual revenue forecast that exceeded analysts’ expectations, pointing to upcoming PC, gaming and data center components.

Rival graphics chip maker Nvidia jumped over 5%, mobile chipmaker Qualcomm added over 2% and memory chip manufacturer Micron Technology climbed 1.5%.

Industry heavyweight Intel Corp, which has lost market share to AMD in recent years as it struggles with next-generation manufacturing technology, declined almost 1% following AMD’s report.

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Tuesday’s after-hours surge in chip stocks is the latest in a recent bout of volatility in the sector. While growth stocks have suffered broadly from worries about rising interest rates, investors are also debating when the global chip shortage might ease, and whether companies are in danger of over-investing and getting caught in a downturn.

Following a recent drop in cryptocurrencies, prices charged by scalpers on eBay for PC gaming graphics cards made with AMD and Nvidia’s chips are showing signs of declining following over a year of empty shelves at retailers, according to Tom’s Hardware.

A quarterly report from industry bellwether Microchip Technology Inc late on Thursday may offer more clues about when the global chip shortage might abate.

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The Philadelphia Semiconductor Index has surged 8% in the past three sessions, but it remains down 13% from its record-high close in December.

(Reporting by Noel Randewich in Oakland, Calif.; Editing by Matthew Lewis)

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