Advanced Micro Devices (NASDAQ: AMD) is gearing up for the market opening on December 26, with investors keenly observing two significant trends: the evolving story around AMD’s MI308 AI accelerators in China and the sustained demand for AI infrastructure that underpins growth prospects.
With U.S. markets set to reopen after the Christmas holiday, traders are bracing for potential market fluctuations due to lower liquidity often seen during this festive period. An early close on December 24 saw AMD stock close at approximately $214.63, with after-hours trading slightly higher at $214.68 and a volume of around 7.96 million shares.
As investors assess AMD’s stock trajectory, two key narratives demand attention. Firstly, AMD has signaled its readiness to incur a 15% fee to ship MI308 AI chips to China, aligning with recent regulatory policies. The company holds shipping licenses under the U.S. government’s framework, which governs the export of advanced chips but remains sensitive amid political scrutiny.
Secondly, whispers of a substantial order from Alibaba for 40,000 to 50,000 MI308 accelerators could serve as a pivotal catalyst for AMD, should these reports materialize into confirmed contracts. Such large orders are significant not only for their immediate revenue potential but also for supporting AMD’s position in a competitive landscape increasingly dominated by AI infrastructure demand from both cloud giants and smaller, cost-sensitive players.
In a promising development, cloud provider Vultr has announced a $1 billion investment to create an AI cluster in Ohio utilizing AMD’s MI355X GPUs. This serves as an encouraging signal that AMD’s offerings are appealing beyond large hyperscaler platforms, potentially attracting a wider customer base.
The spotlight will also be on AMD’s upcoming events. CEO Lisa Su is set to deliver a keynote at CES 2026 on January 5, where the company will outline its vision for AI solutions. Additionally, the next earnings call is slated for February 3, 2026. Investors will be keenly analyzing any forward-looking guidance and updates regarding the company’s progress on AI infrastructure developments during these events.
Market analysts currently maintain bullish sentiments toward AMD, with average price targets hovering around the high $200s. However, the wide-ranging estimates reflect an inherent uncertainty, primarily tied to how AMD navigates the competitive landscape against industry leaders like Nvidia while scaling its AI revenue.
As AMD continues to maneuver through regulatory environments and capture new business opportunities, the trajectory into 2026 looks hopeful. Sustaining this momentum will depend on navigating the complexities of geopolitical factors, solidifying customer relationships, and capitalizing on the growing demand for AI technologies. Given the potential for significant developments in the coming weeks, AMD remains a key stock to watch in the semiconductor sector.