The rotation of software stocks (“SaaS”) into hardware AI chip suppliers accelerated last week. Intel (INTC) sparked an incredible rally after posting quarterly results. Shares gained 20.5% last week and are up by 123.69% YTD.
Intel’s rally lifted AMD (AMD) by more. Shares gained ~ 25% last week and are up by 62.4% YTD. Will their rally fade? Intel opened at $83.87 last Friday. That surpassed its dot-com era record high. In Q1, the firm posted a GAAP loss. However, adjusted EPS was $0.29, as revenue grew by 7.2% Y/Y to $13.58 billion.
The notion that CPU demand accelerated sent AMD stock to all-time highs. Agentic AI is apparently driving stronger demand. Before that news, markets did not bid AMD shares higher with its MI Instinct AI server strength. AMD will post results on May 5.
Sustained Rally
Both AMD and Intel will need to report stronger server CPU sales to justify the rally. AMD is in a good position to raise prices if demand is outstripping supply.
Arm Holdings (ARM) gained 41.39% in the last week. Readers who listened to Morgan Stanley’s downgrade of ARM stock on April 7 lost out. Analysts thought that DRAM supply constraints and end-market softness would hurt demand. Markets disagreed, but using their buying momentum to send ARM stock to $234.81.
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