Advanced Micro Devices (AMD) stock took a beating on Friday alongside a report that OpenAI has a new supplier. According to this report, Broadcom (AVGO) has signed a deal with the ChatGPT maker for $10 billion in custom chips. OpenAI is among the largest AI research firms, making a deal with Broadcom a blow to AMD, as well as Nvidia (NVDA).
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AMD is especially hurt by OpenAI choosing Broadcom as a supplier. That’s largely due to it lagging behind in the AI race. Despite solid demand for its AI offerings, the company hasn’t been able to gain meaningful ground against Nvidia, which dominates the AI graphics processing unit (GPU) market. Now it looks like Broadcom will be a serious competitor in the space as well, causing more problems for AMD.
One area where AMD is performing well is the consumer sector. While still behind rivals Nvidia and Intel (INTC), AMD has slowly grown its market share in the consumer GPU and CPU sectors. This could allow the company to experience financial growth even without strong demand in the AI market.
AMD Stock Movement Today
AMD stock was down 5.36% on Friday, but remained up 26.61% year-to-date. The company’s shares have also rallied 20.42% over the past 12 months. AMD has managed to secure gains this year despite economic pressure. This pressure comes from inflation, tariffs, trade restrictions, and other economic factors.
Is AMD Stock a Buy, Sell, or Hold?
Turning to Wall Street, the analysts’ consensus rating for AMD is Moderate Buy, based on 26 Buy and 11 Hold ratings over the past three months. With that comes an average AMD stock price target of $184.91, representing a potential 20.64% upside for the shares.
