AMD Stock Is Soaring Monday: What's Going On?

Advanced Micro Devices Inc AMD shares are trading higher Monday following a positive update from Piper Sandler. There are also unconfirmed rumors that the company scored a “GPU win” with Amazon Web Services.

What’s Going On: Piper Sandler analyst Harsh Kumar maintained AMD with an Overweight rating and raised its price target from $125 to $140 following the chipmaker’s pre-quarter close call.

Kumar highlighted product launches at AMD’s “Advancing AI” event last week, noting that the Helios rack announcement is “pivotal” for AMD Instinct growth moving forward.

The Piper Sandler analyst is also optimistic that the company’s GPU business is trending in the right direction and should see a “snapback” in the fourth quarter after it gets past China-related charges.

“We know that AMD's AI business is expected to inflect upward starting 3Q25 and that should offset some of these charges. We are showing growth in our model for the AI business starting Sept 25 quarter,” the analyst said in a new note to clients.

Kumar also noted that AMD and Amazon.com Inc AMZN appear to be engaged in a strong relationship, with Amazon being a customer at multiple levels.

“The relationship spans CPUs + GPUs and Amazon is likely to announce the relationship at its own discretion. There was some speculation about this in the investor community,” the Piper Sandler analyst said.

The potential expanded relationship with Amazon appears to be the main driver of the strong surge in AMD shares on Monday. CNBC’s David Faber reported on “Squawk On The Street” that the unusual momentum in shares appears to be fueled by an unconfirmed rumor about a GPU deal between the two companies.

“I am hearing some talk though that involves perhaps a GPU win for AMD from AWS,” Faber said Monday morning on the show.

Amazon disclosed in a regulatory filing last month that it acquired an $84.4 million stake in AMD after the chipmaker acquired server manufacturer ZT Group International, which Amazon held a stake in. In connection with the takeover deal, AMD issued shares to ZT Group shareholders, including Amazon.

AMD Price Action: AMD shares were up 9.44% at $127.04 at the time of publication Monday, according to Benzinga Pro.

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Photo: courtesy of AMD.