AMD Set to Top $1 Trillion in Market Value as Chip Stocks Soar

(Bloomberg) -- Advanced Micro Devices Inc. shares jumped Monday, putting the company on track to close above $1 trillion in market value for the first time amid renewed optimism for chipmakers necessary to power artificial intelligence.

The stock gained as much as 10% to hit a record high and is on course to join fellow chipmakers Micron Technology Inc, Broadcom Inc., Taiwan Semiconductor Manufacturing Company Ltd. and Nvidia Corp, with valuations of $1 trillion or more. There are 15 other publicly traded companies in the world worth at least that much, according to data compiled by Bloomberg.

Shares of other semiconductor firms also climbed on Monday, as Intel Corp. rose as much as 12% and Arm Holdings Plc gained as much as 14%. The Philadelphia Semiconductor Index climbed more than 4%, set for its fifth straight session of gains.

At least some of the optimism for chip stocks comes after Meta Platform Inc.'s Muse AI Agent reached the top slot among Apple Inc.'s App Store free applications following its launch earlier this month. That's stoked a renewed frenzy for shares of companies that produce central-processing units, or CPUs, necessary to power agentic AI. Meta shares soared more than 7% on Monday.

"As AI agents gain broader consumer adoption, demand for server CPUs should benefit from higher inference, orchestration, and infrastructure workloads," Jefferies analyst Jacky He wrote in a note.

AMD shares have seen renewed enthusiasm from investors in recent weeks after a two-month period of losses. The stock has gained about 30% so far in September, putting it on track for its best monthly gain since May, after shedding nearly 26% from its June peak to its July trough. Meta is AMD's second-biggest customer, accounting for about 5.5% of its revenue, data compiled by Bloomberg show.