AMD Stock Slides Amid Downgrade, Tariff Threats, AI Competition

Shares of Advanced Micro Devices (AMD) plummeted today due to an analyst downgrade citing weakness in its AI division. The stock also reacted to a downbeat employment report and threats of tariffs on semiconductors. OpenAI’s plan to produce its own AI chips further impacted suppliers like AMD and Nvidia, causing a 6.3% drop in AMD stock.

Seaport Research downgraded AMD from buy to neutral, highlighting slowing growth in its AI chip business as the main reason for the sell-off. Reports of only 22,000 jobs added in August and President Trump’s tariff threats on semiconductor imports added to concerns. Uncertainty over how the policy may affect AMD, a U.S. based company reliant on foundries like TSMC, contributed to the stock decline.

Despite strong sales of its Instinct Mi350 AI accelerators, AMD faces potential challenges in AI growth, especially with OpenAI’s move to produce its own AI chips. Investors should monitor reports of further weakness in AMD’s AI business and consider potential impacts on the company.