Intel and AMD catch the AI wave as spending booms — ride the chip rally
The broader stock market is having its best quarter in six years, driven by a massive $2 trillion surge in chip stocks like Intel and AMD. Goldman Sachs notes this strength is underpinned by companies pouring money into AI infrastructure.
Idea
Despite jitters about the 'Magnificent Seven' stocks, the broader tech market—specifically chipmakers—added $2 trillion in value last quarter. When this chip strength is combined with Goldman Sachs' observation that a generational boom in capital spending is driving the bull market, it suggests investors are rotating from overvalued mega-cap stocks into the infrastructure suppliers of AI. As long as corporate spending on AI remains robust, this momentum in chip stocks should continue.
What happened since
| Symbol | Dir | T+1 | T+5 | T+20 |
|---|---|---|---|---|
| INTC | LONG | -5.25% ✗ | -3.79% ✗ | — |
| AMD | LONG | +0.00% ✗ | +0.00% ✗ | — |
Price change since publication · updated Jul 11
Advanced analysis
Will INTC close the 14% gap to its 50-day average before AMD's momentum cools, or is the chip rally already splitting?
Can AMD's 34% revenue growth and Intel's $52.9B top line sustain the chip rally Goldman Sachs is betting on?
Is Intel's negative $4.9 billion free cash flow and sub-35% gross margin a warning sign the chip rally can't overcome?