AMD Stock Surges With Microsoft, Meta, and OpenAI Set to Use Its ...

Advanced Micro Devices Inc. (AMD) shares surged over 8% in intraday trading Thursday after the chipmaker launched its latest artificial intelligence (AI) chip, with Microsoft (MSFT), Meta (META), and OpenAI all set to use it.

AMD CEO Lisa Su called the chip maker's Instinct MI300 data center graphics processing unit (GPU) accelerators "the highest-performance accelerators in the world for generative AI," at Wednesday's launch event.

ChatGPT maker OpenAI plans to use MI300 in its programming system, Triton 3.0, while Meta will add the chip to its data centers, AMD said. Microsoft had also announced that it would use the new AMD chip in its cloud computing segment, Azure.

With the support of some of the companies leading AI development, AMD could be poised to challenge AI chip leader, Nvidia's (NVDA) dominance.

"AI is the future of computing and AMD is uniquely positioned to power the end-to-end infrastructure that will define this AI era,” Su said.

"AMD remains the clearest challenger to NVDA and is positioned to ramp meaningfully in 2024," Wedbush analysts said in a note Thursday following the chip's launch.

However, the analysts noted that while AMD "should be viewed as the best positioned (currently) alternative to NVDA," the company could face an uphill battle trying to overtake Nvidia's dominant standing, writing, "NVDA should still end up a winner (if not the winner)."

AMD shares were up 8.1% at $126.29 as of about 12:20 p.m. ET, trading near their highest levels since June. With Thursday's gains, shares of AMD have nearly doubled in value so far this year, while Nvidia shares have more than tripled in the same period.

Correction—Dec. 7, 2023: This article was updated to reflect more recent price data.