Intel and AMD Surge Amid AI Demand
Intel (NASDAQ: INTC) and Advanced Micro Devices (NASDAQ: AMD) have both reported significant gains in Q1 2023 due to rising demand for central processing units (CPUs) driven by agentic artificial intelligence (AI). Intel’s stock has increased more than 186% year-to-date, with data center revenue up 22% to over $5 billion in the quarter. AMD also performed well, with a year-over-year data center revenue increase of 57%.
Intel has been refocusing its strategy towards AI, intending to control the full manufacturing stack. AMD, operating as a fabless company, relies on Taiwan Semiconductor for production and expects a compound annual growth rate (CAGR) for CPUs exceeding 35%, expanding its total addressable market to over $120 billion by 2030. Analysts suggest cautious investment due to high valuations, with Intel’s stock trading at over 104 times forward adjusted earnings per share and AMD at 57 times, prompting suggestions for potential entry point strategies.
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