Advanced Micro Devices Inc. (NASDAQ:AMD) stock was down nearly 4% in Thursday’s premarket trading as semiconductor stocks broadly weakened following Taiwan Semiconductor Manufacturing Company Ltd.’s (NYSE:TSM) second-quarter earnings report and increased capital spending outlook.
Broader market sentiment also weakened, with Nasdaq futures down 0.89% and S&P 500 futures off 0.31%.
Taiwan Semiconductor Sparks Sector Pullback
The sector pullback came after Taiwan Semiconductor reported better-than-expected second-quarter results and raised its capital expenditure forecast.
While the outlook reinforced long-term demand for artificial intelligence chips, investors appeared concerned about the scale of future spending, triggering broad profit-taking across semiconductor stocks.
Advanced Micro Devices, which has gained more than 230% over the past year, was among the hardest-hit large-cap chipmakers as investors reduced exposure to high-growth technology names.
AMD Technical Picture Remains Constructive
Despite Thursday’s decline, Advanced Micro Devices continues to trade above its longer-term moving averages. The stock remains 3.7% above its 50-day simple moving average of $493.09, 40.4% above its 100-day average of $364.23 and 74.4% above its 200-day average of $293.31.
However, the shares are now 4.2% below the 20-day simple moving average of $534.17, suggesting near-term momentum has cooled.
The relative strength index stands at 51.74, indicating neutral momentum.
Key resistance sits near $546.50, while support is around $498.00, just above the 50-day moving average.
AI Growth Keeps Analysts Bullish On AMD
Advanced Micro Devices designs processors and graphics chips for personal computers, gaming consoles, data centers, industrial systems and automotive applications. The company has expanded aggressively into artificial intelligence accelerators, a key driver behind its strong stock performance over the past year.
The company’s next earnings report is scheduled for Aug. 4. Analysts expect earnings of $1.55 per share on revenue of $11.28 billion, up from earnings of 48 cents per share and revenue of $7.68 billion a year earlier.
Wall Street remains broadly positive on the stock despite Thursday’s pullback. The consensus rating is Buy with an average price forecast of $521.47. Recent analyst actions include Bank of America raising its price forecast to $620, KeyBanc increasing its forecast to $725 and TD Cowen lifting its forecast to $675.
AMD Price Action
AMD Stock Price Activity: Advanced Micro Devices shares were down 3.62% at $510.01 during premarket trading on Thursday, according to Benzinga Pro data.
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