AMD: Turbulent times in the semiconductor market

Advanced Micro Devices, Inc. (AMD) is a US semiconductor company headquartered in Santa Clara, California. AMD develops and sells computer chips, microprocessors, chipsets, graphics processing units (GPUs) and system-on-a-chip (SoC) solutions. In the B2B sector, the company focuses specifically on the computer and communications industry, but also directly on consumers.

AMD no longer has its own production facility since the spin-off of the actual semiconductor production in Globalfoundries in 2009 - the company is therefore referred to as “fabless”.

AMD has been listed in the Standard & Poor's 500 stock index since March 20, 2017, employs around 25,000 people worldwide (as of 2022) and is the second-largest x86 processor manufacturer in the world after Intel (as of 2011). The company's shares were traded on the New York Stock Exchange from 1979 to 2014 and have been listed on the NASDAQ since January 2, 2015.

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AMD has corrected by more than -65% since around March 2024 and is therefore worth a look now. The company has grown in the last 10 years from approx. 4 billion to over 24 billion in 2024. With sales of over USD 24 billion, the company generates EBITDA of around USD 5.15 billion and has a cash position of over USD 5 billion with around USD 2.32 billion in debt. Trailing and forward P/E have fallen significantly with the major correction. Margins are also rising continuously, which is steadily increasing the company's profitability.

From a classical technical analysis perspective, the share is more oversold on a weekly basis than ever before. The last time the share was similarly oversold, it staged a rally of over +300% in the following months. In addition, the share is trading below the SMA/EMA(200) for the first time since the end of 2022. It would be very surprising if the share did not at least recover significantly from here. The share was recently mentioned in one of our subscriber chats when it was trading at around USD 80. With the “monster rally” on April 9, 2025, it then shot up by >20% to over USD 96.

According to EW theory, there is a chance that wave “y” of “ii” has been completed and the bottom has been reached. Unfortunately, an alternative scenario in which the share price could still fall below USD 50 cannot be completely ruled out and must (unfortunately) be factored in with a low probability. In the very short term, a setback below USD 90 should be factored in without falling below the low of around USD 78.