Advanced Micro Devices (NASDAQ:AMD) stock fell more than 2% in Thursday premarket trading as investors took profits following a sharp rally that recently pushed the chipmaker above a $1 trillion market value.

S&P 500 futures fell 0.6%, adding to the softer backdrop for technology stocks.

AMD Joins $1 Trillion Chip Club

AMD on Monday became the fourth U.S. chipmaker to exceed a $1 trillion market capitalization, following NVIDIA Corp. (NASDAQ:NVDA), Broadcom Inc. (NASDAQ:AVGO) and Micron Technology, Inc. (NASDAQ:MU).

The milestone capped a powerful rally driven by investor enthusiasm around AMD’s expanding role in AI computing. Shares gained 185% in 2026 and nearly 300% over the past 12 months.

By comparison, NVIDIA gained about 27% over the past year, while Intel returned close to 300%.

Great Hill Capital Chairman Thomas Hayes told Reuters on Monday that investors were moving back into the AI trade and viewed AMD as representative of that shift during a potential Federal Reserve-driven economic slowdown.

AI Inference Expands AMD’s Opportunity

AMD has gained server CPU market share from Intel as demand grows for processors that work alongside GPUs during AI inference.

The company has also expanded beyond individual chips into complete systems that combine processors, networking equipment and related hardware, strengthening its effort to compete with NVIDIA.

Investor attention has also turned to "agentic AI," which could increase CPU-heavy inference demand. That theme gained attention after Meta Platforms, Inc. (NASDAQ:META) said its Muse personal AI agent ranked as the most-downloaded free Apple Inc. (NASDAQ:AAPL) iPhone app in the U.S. for three consecutive days, according to Sensor Tower.

AMD still faces high expectations. Its latest revenue outlook exceeded Wall Street estimates but fell short of elevated investor expectations, while markets continue to scrutinize hyperscaler AI spending.

Analysts Remain Bullish

AMD carries a Buy consensus rating with an average price forecast of $604, ranging from $365 to $730 across 50 analysts.

Piper Sandler initiated coverage with an Overweight rating and $600 forecast on Sept. 10. Raymond James upgraded AMD to Strong Buy and raised its forecast to $641 on Aug. 25, while BMO Capital initiated coverage with Outperform and a $550 forecast on Aug. 21.

AMD Carries Significant ETF Exposure

AMD represents 8.74% of the iShares Semiconductor ETF (NASDAQ:SOXX), 6.79% of the First Trust Nasdaq Semiconductor ETF (NASDAQ:FTXL) and 6.52% of the Pacer Data and Digital Revolution ETF (NYSE:TRFK).

Price Action

AMD Stock Price Activity: Advanced Micro Devices shares were down 2.21% at $601.00 during premarket trading on Thursday, according to Benzinga Pro data.

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