AMD Plummets 7.1% Amid AI Hype Dampened by Data Center Woes and Export Headwinds

Summary
• AMD shares plunge 7.1% to $161.915, erasing $12.4B in market cap
• Q2 data center revenue drops 12% sequentially amid China export restrictions
• MI350 AI chips to ramp in H2, but near-term hurdles persist
• Sector peers like Intel (INTC) rally 0.8% as semiconductors face mixed signals

Advanced Micro Devices’ sharp intraday decline reflects a collision of near-term regulatory headwinds and investor skepticism about AI-driven growth. Despite a Q2 revenue beat and Q3 guidance above consensus, the stock’s 7.1% drop underscores market anxiety over China export restrictions and soft data center demand. With Bollinger Bands tightening and a bearish engulfing pattern forming, traders are recalibrating positions as AMD tests critical support levels.

Data Center Revenue Slump and China Export Restrictions Spur Sell-Off
AMD’s 7.1% intraday drop stems from a dual blow: a 12% sequential decline in data center revenue to $3.24B and U.S. export restrictions crippling MI308 sales to China. While Q3 guidance of $8.4–$9B exceeded expectations, the absence of AI-driven upside—coupled with an $800M China-related hit—spooked investors. CEO Lisa Su’s emphasis on MI350X ramping in H2 failed to offset near-term concerns, as the stock’s 52W high of $182.5 becomes a distant memory. The bearish engulfing candlestick pattern and MACD histogram contraction signal intensifying selling pressure.

Semiconductor Sector Volatility as Intel Gains Ground
The semiconductor sector remains fragmented, with Intel (INTC) rising 0.8% as AMD tumbles. Intel’s rebound under CEO Lip-Bu Tan contrasts AMD’s struggles, highlighting divergent execution trajectories. While AMD’s data center segment faces headwinds, Intel’s foundry pivot and AI partnerships with Tesla and Samsung are gaining traction. This divergence underscores the sector’s bifurcation: companies with diversified AI strategies (e.g., Intel, NVIDIA) outperform those reliant on China exposure (e.g., AMD).

Options and ETF Plays for AMD’s Volatile Rebound
• MACD: 10.75 (above signal line 10.48), Histogram: 0.27 (bullish divergence)
• RSI: 65.40 (neutral), 200D MA: $123.65 (far below current price)
• Bollinger Bands: $137.16–$186.54 (current price near lower band)

AMD’s technicals suggest a short-term bounce from oversold levels but long-term consolidation. Key support at $137.16 (lower Bollinger) and resistance at $161.85 (middle Bollinger) define a trading range. The 200D MA at $123.65 remains a critical floor. For leveraged exposure, ETFs like XLK (XLF) could mirror sector rotation, though data is unavailable here.

Top Options:
• AMD20250815C165
- Call, Strike: $165, Expiry: 2025-08-15
- IV: 43.68% (moderate), Leverage: 51.20% (high), Delta: 0.3965 (moderate), Theta: -0.4813 (high decay), Gamma: 0.0331 (high sensitivity), Turnover: $9.01M (liquid)
- Payoff: 5% downside to $153.82 yields $8.82 profit per contract. This call offers aggressive leverage with high gamma to capitalize on volatility.
• AMD20250815C170
- Call, Strike: $170, Expiry: 2025-08-15
- IV: 44.90% (moderate), Leverage: 90.61% (very high), Delta: 0.2562 (low), Theta: -0.3598 (high decay), Gamma: 0.0269 (moderate), Turnover: $4.74M (liquid)
- Payoff: 5% downside to $153.82 yields $16.18 profit per contract. This call’s high leverage and moderate gamma make it ideal for a sharp rebound.

Action: Aggressive bulls may consider AMD20250815C165 into a bounce above $165. If $137.16 breaks, AMD20250815P155 offers short-side potential.

Backtest Advanced Micro Devices Stock Performance
AMD has a history of positive short-to-medium-term gains following a -7% intraday plunge. The backtest data shows that the 3-day win rate is 53.69%, the 10-day win rate is 52.05%, and the 30-day win rate is 52.55%. Additionally, the maximum return during the backtest period was 6.80% over 30 days, indicating potential for recovery after a significant drop.

AMD at Crossroads: Watch $137.16 Support and Q3 AI Ramp
AMD’s 7.1% drop reflects a critical inflection point between near-term regulatory hurdles and long-term AI potential. While the stock’s 52W low of $76.48 remains distant, support at $137.16 (lower Bollinger) and resistance at $161.85 (middle Bollinger) define a key trading range. The sector’s mixed signals—Intel’s 0.8% gain versus AMD’s slump—highlight divergent execution risks. Investors should monitor Q3 AI ramp progress and China export policy updates. For now, a 5% downside scenario favors the selected call options, but a break below $137.16 could trigger deeper selling. Act: Position for a rebound above $161.85 or hedge with AMD20250815P155 if $137.16 breaks.