AMD Stock Price Jumps Past $305 as Intel Earnings Spark a Chip Rally Nobody Saw Coming

Observing a stock price surpass the analysts who are increasing their targets on it is peculiar. By pre-market on Friday, AMD was hovering around 332 after closing at 305.33 on Thursday. Ruben Roy of Stifel had just walked his target up to 320, but the market had already surpassed that figure before the majority of New York desks had finished their coffee. That is not something you see very often. It typically indicates one of two things: either the story has outpaced itself, or the Street is consistently behind schedule on a story.

This week’s catalyst came from a somewhat surprising source. Of all the companies, Intel reported earnings that appeared strong enough to lift the entire chip industry. Demand for data centers continued to rise, server CPUs were holding up better than anticipated, and all of a sudden, semiconductors unrelated to Intel’s numbers began to rise. AMD capitalized on the trend. It was caught by Broadcom. As reported by Reuters, the Philadelphia Semiconductor Index was also showing what appeared to be its sixteenth consecutive gain.

We might be witnessing more of a reevaluation of the true cost of AI infrastructure and who gets to sell the picks and shovels than a single stock rally. That discussion has focused almost exclusively on Nvidia for years. A room full of developers applauding Jensen Huang in a leather jacket on stage. AMD has always been the alternative name, the one you brought up when you wanted to come across as unconventional. No longer.

For the past 12 months, Lisa Su has been telling investors a specific story, and now that story is being taken seriously. In essence, AMD is no longer a chip manufacturer attempting to outperform Nvidia in terms of specifications. With deep multi-gigawatt commitments from Meta and OpenAI, rack-scale systems called Helios, and MI450 accelerators, it is evolving into an AI infrastructure company. The second half of 2026 is when the first gigawatt of the Meta deployment is expected to ship. An additional six gigawatts are added by OpenAI’s contribution, which uses MI450 silicon. With the quiet assurance of someone who does not take these statements lightly, Zuckerberg referred to AMD as “an important partner for many years to come.”

All of this, however, has a tension that is worth enduring. The P/E ratio for AMD is currently higher than 117. Over the past 12 months, the stock has increased by about 219%. The average 12-month Street target is approximately 288, which is below the current share price. This type of gap typically closes in one of two ways, neither of which is gentle. Either the correction shows up in a week when no one anticipated it, or earnings support the premium.

This will be tested on May 5. More important than the headline figures will be AMD’s first-quarter results and management’s tone regarding the Helios ramp, supply constraints, and the speed at which those Meta and OpenAI deals turn into booked revenue. Reading analyst notes lately has given me the impression that everyone is preparing for something. Bernstein has identified problems with supply. If AMD truly meets its goals, the performance-based warrants linked to the hyperscaler deals may dilute current shareholders—a peculiar kind of issue.

As this develops, it’s difficult to ignore how quickly the AMD narrative has changed. The stock was trading at 90 a year ago. Whether 320 is conservative is a topic of debate these days. Between those two figures, the company’s narrative shifted from one of competition to one of capacity—that is, the number of chips, racks, and gigawatts of AI computing that the world genuinely wants to purchase. As of right now, the answer appears to be a lot. The question of whether that results in the kind of earnings growth that warrants a half-trillion dollar market cap will begin to be answered on May 5, not earlier.