Steve Marcus/Reuters
Summary List PlacementAdvanced Micro Devices bucked the tech sell-off on Wednesday to gain more than 3% at highs after the company announced a new stock-buyback program.
AMD said it plans to buy back $4 billion of its outstanding common stock using cash generated from operations.
The buyback plan has no end date and can be suspended or discontinued at any time, according to a press release from the company.
"Today's announcement reflects our confidence in AMD's business and the successful execution of our multi-year growth strategy," Dr. Lisa Su, AMD's president and CEO, said in a press release.
"Our strong financial results and growing cash generation enable us to invest in the business and begin returning capital to our shareholders," she added.
The bullish news for AMD shareholders comes just over a week after Citi analysts said both Intel and AMD will feel the sting of a PC downturn moving forward.
Analyst Christopher Danley reiterated his "neutral" rating for Intel and "sell" rating for AMD in a note to clients, noting that April PC shipments were "well below expectations," falling 13% month-over-month.
Danley said it was the "first negative data point in the PC food chain since Jan. 2020."
On top of the downgrade from Wall Street, Intel announced its new 11th Generation Core H-series mobile processors (code-named "Tiger Lake-H") on May 11.
The new chips will compete with AMD's Ryzen 5000 series lineup, which CEO Lisa Su called the "most powerful PC processors ever built for ultrathin and gaming notebooks" back at the CES 2021 conference.
It's not all bearish news for AMD, however. The company turned in stand-out results in the first quarter of 2021. Susquehanna analyst Christopher Rolland said AMD was "hitting on all cylinders" in the quarter after AMD released its results.
Revenue in the quarter rose 93% year-over-year to $3.45 billion and net income jumped 243% to $555 million, according to a press release from the company.
AMD stock is up roughly 36% over the past year, but down nearly 8% in the last six months.
Shares traded up 1.9% as of 2:45 p.m. ET on Wednesday.
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