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U.S. semiconductor stocks rose on Wednesday as Advanced Micro Devices' (AMD.O) strong outlook boosted investor confidence about sustained demand for AI infrastructure and that a shift toward CPUs would spur the next leg of spending.
AMD jumped nearly 18% in premarket trading and is on track to hit a record high if gains hold in market hours, while rival Intel (INTC.O) rose 6%. Chip designer Arm Holdings soared 11%, while Qualcomm (QCOM.O) gained about 4%.
Custom chip maker Marvell Technology (MRVL.O) gained 1.7%, and Micron Technology (MU.O) surged 6.4%.
Central processing units have taken center stage as companies and businesses gravitate towards agentic AI - systems that perform autonomous functions - broadening demand beyond graphics processing units, or GPUs, that are used to train large models.
Like rivals Nvidia and Intel, AMD late on Tuesday said a shift toward "inference," where AI models are deployed in real-world applications, is opening up fresh opportunities for its server CPUs.
The company now expects the server CPU addressable market to grow by more than 35% annually through 2030, up from a prior forecast of 18%.
"AMD story is no longer just about having a GPU pipeline to challenge Nvidia... It's increasingly about a broader compute opportunity, with CPUs and GPUs both playing a role as AI workloads become more demanding," said Matt Britzman, senior equity analyst at Hargreaves Lansdown.
AMD shares, which had their best month in April since the dotcom era, have already climbed about 66% for the year, outpacing Nvidia's gain of 5%.
AMD trades at about 39.66 times forward earnings, well above its five-year average and nearly double Nvidia's roughly 21‑times multiple, despite the latter's much larger AI market share.
Earlier in the day, Samsung Electronics became only the second Asian company to reach $1 trillion in market value, catapulted by an AI-powered rally.
SUPER MICRO RALLY SHRUGS OFF LEGAL CLOUDS
Super Micro also surged nearly 19% after forecasting fourth-quarter revenue and profit above expectations, reassuring investors rattled by a recent U.S. Justice Department case linked to illegal chip shipments to China.
The outlook underscores strong demand for Super Micro's customizable, high‑performance AI servers from data-center operators and startups.
CEO Charles Liang said demand was also strong for its broader data-center and cloud software offerings, while production sites in Taiwan, Malaysia and the Netherlands are ramping up aggressively.
J.P. Morgan analysts said the better-than-expected outlook was driven by margin recovery and diversification of customers, but flagged corporate governance issues as a lingering overhang.
