AMD Stock Price Falls 4% After AI Downgrade Amid Rising Nvidia, Intel Competition
Today the AMD stock has been downgrades and it continues yesterday’s decline, with Nvidia chips intel increasing competition.
AMD Shares Struggle Despite Market Rebound
While global markets have shown signs of recovery, boosted by expectations of lower tariffs on US auto imports, AMD stock continues to face strong bearish pressure. Following a 5% decline yesterday, the stock opened today with a significant downward gap and is currently trading around $106 per share.
AMD Tech Downgrade and Competitive Challenges
Shares of Advanced Micro Devices (AMD) fell sharply after analysts at Jefferies downgraded the stock, citing an increasing performance gap between AMD and Nvidia in the AI sector. Over the past year, AMD has lost more than 40% of its value, struggling to keep pace with its competitors.
Although the tech sector recently saw bullish momentum, driven by renewed confidence in major firms like Apple, Tesla, and Amazon, AMD has been unable to sustain gains. Over the past two days alone, AMD shares have declined by nearly 9%, significantly underperforming the broader tech market.
Nvidia’s Lead and Analyst Outlook
Jefferies analysts emphasized that Nvidia’s H200 GPU demonstrates a clear performance advantage over AMD’s MI300x, based on recent benchmarking across multiple AI models. The firm expects this performance gap to expand further, putting AMD at a growing disadvantage in the AI chip market.
Due to these concerns, Jefferies downgraded AMD’s stock from a “buy” to a “hold” rating and reduced its price target from $135 to $120. This new target falls notably below the previous Wall Street consensus of $140, reflecting a more cautious outlook on AMD’s ability to compete with Nvidia in the AI sector.
Conclusion
AMD’s struggles highlight the intensifying competition in the AI and semiconductor industry, particularly against Nvidia and Intel. While broader market conditions may provide some short-term relief, the company’s AI advancements and market positioning will be critical in determining its long-term growth potential. Investors will need to monitor upcoming earnings reports and AI product developments to assess whether AMD can regain its momentum in the fast-evolving AI sector.
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