Advanced Micro Devices (AMD) shares are caught between conflicting market forces this Friday. On one hand, reports of significant server processor shortages are emerging from China. On the other, the recent stock price weakness has attracted buying from star investor Cathie Wood. The equity is trading near $192.50 in the wake of an after-hours decline, placing it approximately 14% below its 50-day moving average.
Ark Invest Sees Opportunity in Recent Weakness
Aligning with its strategy of acquiring shares of disruptive technology companies during periods of market softness, Cathie Wood’s Ark Invest purchased AMD stock on February 5. This move followed an immediate sell-off triggered by the company’s quarterly earnings release. On that same day, the investment firm also increased its position in Broadcom while reducing its holding in Qualcomm.
The catalyst for the sell-off was AMD’s first-quarter 2026 revenue guidance of approximately $9.8 billion. This figure represents a sequential decline from the record $10.3 billion revenue reported for the fourth quarter of 2025. In response, the share price fell nearly four percent, leaving it trading roughly 27% below its 52-week high.
Chinese Server CPU Shortages Pose a Challenge
Separate reports dated February 6 indicate that customers in China are now facing wait times of up to six months for certain server central processing units (CPUs). Both AMD and Intel have notified their clients about these extended delivery timelines. Analysts point to a combination of robust demand from hyperscale data center operators and bureaucratic hurdles stemming from U.S. export controls as the primary causes.
Should investors sell immediately? Or is it worth buying AMD?
Market research firm TrendForce has confirmed that server processor prices in the region have already increased. While this points to solid underlying demand, it also highlights the strains on semiconductor supply chains within regulated markets.
Analyst Confidence Endures Despite Near-Term Caution
Despite the cautious short-term outlook provided by the company, equity researchers are maintaining their bullish long-term assessments. On February 5, Evercore ISI reaffirmed its price target of $328 for AMD shares. Similarly, Roth Capital Markets continues to hold a $300 target price. Both firms reference an anticipated acceleration in AI-driven system deployments starting in mid-2026, which is expected to provide renewed momentum for the datacenter segment.
This scenario is characteristic of AMD’s market narrative: near-term operational headwinds juxtaposed against a long-term growth story driven by artificial intelligence and high-performance computing. The coming months will determine whether analyst optimism is warranted or if supply chain issues and margin pressures will have a greater impact than currently anticipated.
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