With a market value exceeding $400 billion, AMD has also doubled this year

Driven by the dual benefits of AI and quantum computing, chip manufacturer AMD's market value has surpassed $400 billion for the first time.

On Friday, Wallstreetcn reported that IBM announced it has successfully run key quantum computing error correction algorithms on AMD's chips. This news propelled AMD's stock price to close up 7.6%, pushing its market value to a new high of $410 billion.

(AMD's market value surpasses $400 billion for the first time)

Since the beginning of this year, AMD's stock price has more than doubled, with most of the gains concentrated in the past month. AMD's market value ranking in the S&P 500 index has also jumped from 44th at the beginning of the year to 21st.

The main catalyst for the recent surge is the company's significant chip agreement with AI research firm OpenAI. This move not only validates AMD's technological strength but also makes Wall Street more optimistic about its future financial prospects.

AI Agreement Ignites Market Enthusiasm

The core driver of AMD's recent stock price surge stems from its significant progress in the AI chip market.

On October 6, Wallstreetcn mentioned that AMD reached a 6GW chip agreement with AI leader OpenAI, with a potential 10% stake.

According to HSBC analyst Frank Lee in a report, he expects AMD's revenue opportunities in the GPU sector could exceed its projected $7.3 billion for this year by more than ten times.

In Lee's view, AMD is "finally narrowing" the performance gap with industry leader NVIDIA with its latest MI350 series products.

Additionally, the latest financial report from competitor Intel suggests a positive outlook for AMD.

Mizuho analyst Jordan Klein stated in a client report, Intel mentioned strong demand in the personal computer and general server markets, both of which are markets served by AMD. Klein believes:

AMD remains well-positioned in the growing demand for cloud and AI-related server CPUs.

Susquehanna analyst Christopher Rolland also noted, Intel's report "highlights the ongoing competitive pressure, and we believe Intel's market share in the server market is continuing to erode to AMD."

Partnering with IBM to Open the Door to Quantum Computing

Beyond the AI narrative, AMD's collaboration with IBM in the field of quantum computing adds new imaginative possibilities to the market According to media reports on Friday, IBM will demonstrate its ability to run quantum error correction algorithms in real-time on off-the-shelf chips manufactured by AMD.

Although quantum computers have enormous potential, their basic unit, the "quantum bit" (qubit), is highly error-prone, which can lead to invalid computation results, and error correction algorithms are key to overcoming this challenge.

Jay Gambetta, head of IBM's research department, stated that this research is significant as it not only proves that IBM's algorithms are feasible in the real world, but can also run on "not excessively expensive" AMD chips, with a speed 10 times faster than required.

It is worth mentioning that this research was completed a year ahead of schedule. This breakthrough directly stimulated the stock prices of both companies, with AMD rising 7% during trading and IBM increasing by about 8%, marking the best single-day performance since January.

Earlier in August this year, the two companies announced an agreement to jointly develop quantum computing capabilities. IBM's goal is to build a quantum computer named Starling by 2029.