AMD joins US$1 trillion club as chipmakers rally on AI-driven demand

Advanced Micro Devices briefly soared past US$1 trillion in market capitalisation for the first time on Monday (Sep 21), joining a small group of chipmakers to reach the milestone, as investors bet on its expanding role in AI computing.

The company's shares were last up 9 per cent at US$610, after surging to an all-time high of US$613.92 - creating a valuation of just over US$1 trillion.

The milestone caps a stellar rally for the Santa Clara, California-based AMD, regarded as the closest rival to AI bellwether Nvidia for graphics processing units.

It becomes the fourth US chipmaker to top a US$1 trillion valuation, after Nvidia, Broadcom and Micron. Nvidia crossed the mark in 2023 and is now the world's most valuable company, worth more than US$5 trillion.

AMD has accelerated its AI product launches and moved beyond selling individual chips to offering complete systems that combine processors, networking gear and related hardware, helping it compete with Nvidia's products.

The company is also benefiting from rising demand for central processing units used alongside graphics processors in servers handling inference. That has helped AMD take market share from Intel.

Early last month, AMD forecast quarterly revenue above Wall Street estimates, which fell short of lofty investor expectations, sending its stock down over 7 per cent on the day. Since then, it has leaped over 26 per cent.

Most chip stocks surged on Monday, with Intel jumping around 11 per cent, Qualcomm rising 4.1 per cent and the broader chips index gaining 2.6 per cent to a one-month high.