Semiconductor stocks, including AMD, are facing significant pressure due to a combination of factors impacting the sector. The introduction of new tariffs by President Donald Trump on imports from China, Canada, and Mexico has heightened concerns about disruptions in the global tech supply chain. This has particularly affected companies with substantial exposure to China, such as Nvidia and Broadcom, which have seen notable declines. Additionally, the emergence of China's DeepSeek AI models, which offer competitive alternatives to Western technologies, has further fueled investor anxiety. These developments have led to a broader sell-off in semiconductor stocks, as investors reassess the potential impact on the sector's growth prospects.
The competitive landscape for AMD is also being reshaped by the increasing shift of major tech companies towards custom silicon for AI infrastructure. This trend poses challenges for AMD, as it competes with Nvidia's dominance in the AI chip market and faces competition from tech giants like Microsoft, Amazon, and Meta, who are developing their own custom chips. Despite expectations of a 22% revenue increase for AMD, the company's growth outlook is clouded by these competitive pressures. The market's reaction to these dynamics is evident in the performance of semiconductor stocks, which have been hit hard by both tariff concerns and the disruptive potential of new AI technologies from China.
The GraniteShares 2x Long AMD Daily ETF (AMDL) is currently trading at $6.63, reflecting a 3.63% decline from the previous close.