New York, May 19, 2026, 17:05 (EDT)
- AMD was last off 1.6% at $414.05 after a choppy session.
- Nvidia’s results out Wednesday are the next big test for the AI-chip trade.
- Citi lifted its AMD price target on Monday while sticking with a Neutral rating.
Advanced Micro Devices shares dropped Tuesday, pulling back after a sharp run-up driven by AI bets. Some investors trimmed chip holdings ahead of Nvidia’s earnings. Higher Treasury yields also pressured growth tech stocks.
AMD ended down 1.6% at $414.05, after swinging between $393.51 and $428.52 in today’s trading. Nvidia slipped 0.7%. Intel was up 2.4%. The chip names went in different directions, not moving lower as a group.
The timing is key here. Nvidia is set to report earnings after the close on Wednesday, and markets are looking to the update for clues on whether AI infrastructure spending still backs up high chip valuations. Options are pricing in about a $355 billion move in Nvidia’s market cap after the results, according to Reuters.
AMD has challenged Nvidia in the race for AI chips. Shares are up this year as demand holds for CPUs — the standard brains inside servers — and GPUs, hardware used to accelerate AI tasks.
Citi’s Atif Malik upped his AMD price target to $460 from $358 on Monday, while sticking with a Neutral rating, market reports said. Malik said the CPU total addressable market could jump from $29.3 billion in 2025 to $131.5 billion by 2030, which would mean a 35% compound annual growth rate.
AMD bulls got another boost after the company posted first-quarter revenue of $10.3 billion, a 38% jump from last year. Data-center revenue climbed 57% on strong EPYC processor and Instinct GPU demand, according to AMD’s May 5 results.
AMD CEO Lisa Su said the company is seeing “accelerating demand for AI infrastructure” and “strong momentum” in inferencing and agentic AI, which refers to AI systems that handle multi-step tasks with less human input. CFO Jean Hu pointed to “accelerating revenue growth” in the quarter and called out “record quarterly free cash flow.” Advanced Micro Devices, Inc.
AMD guided to second-quarter revenue of $11.2 billion, give or take $300 million, topping what Wall Street had expected. Reuters said the company sees server CPU revenue jumping over 70% from a year ago during the quarter.
AMD is no longer seen by analysts as just competing with Nvidia. “It’s increasingly about a broader compute opportunity,” Matt Britzman, senior equity analyst at Hargreaves Lansdown, told Reuters earlier this month. He pointed to rising demand for both CPUs and GPUs as AI workloads get heavier. Reuters
S&P 500 and Nasdaq slipped for a third day Tuesday, with the 10-year Treasury yield reaching its highest since January 2025. Higher yields tend to hit growth stocks harder since their valuations lean on future earnings. The market looked more cautious on the tape.
“Rates are obviously front-and-center,” Garrett Melson, portfolio strategist at Natixis Investment Managers Solutions, told Reuters. He said markets can take a slow rise in yields, but not big, sudden moves. Reuters
AMD faces risks as the market looks ahead of what its earnings show. Reuters said this month AMD was trading at 42.4 times expected earnings, well above its five-year average and almost twice Nvidia’s multiple, even though Nvidia has a bigger AI market share. Shortages in memory chips and rising component prices could pressure AMD’s PC and gaming segments, which it still has to protect.
Nvidia stays in focus for now. Chris Murphy, Susquehanna’s co-head of derivatives strategy, told Reuters the chip space is “a crowded leadership area” with traders pushing for more upside in Nvidia while covering gains in other names. That connects AMD’s prospects to both its execution and to how long Nvidia can hold up the wider AI rally. Reuters
