Why Advanced Micro Devices (AMD) Shares Are Moving Upwards?

Oct 16 - Advanced Micro Devices AMD popped about 9% on Wednesday as investors cheered fresh AI-related contracts and follow-up analyst upgrades.

The move followed two high-profile tie-ups investors view as tangible demand signals. Oracle ORCL will deploy 50,000 of AMD's next-generation Instinct MI450 accelerators across its cloud infrastructure, a deal that underpins multi-year revenue expectations.

Separately, OpenAI expanded its chip sourcing with AMD in a multi-year arrangement, a pact Wall Street treats as a structural win for AMD's data-center roadmap. Those partnerships pushed several brokers to raise price targets or trim concerns about near-term adoption.

Strong year-to-date momentum that preconditioned an acute response to the news was also given as an indication by market participants. According to the analysts, the share gains that AMD experienced this year indicate increasing betting on the fact that the company could achieve a larger portion of the AI infrastructure spending.

Traders cautioned the rally may price in a lot of future revenue: execution, delivery schedules and competition from rivals remain the key variables. If deployments slip or margins compress, the stock could retrace some of its gains.