AMD Stock: Intel Foundry Talks and Cohere AI Partnership Drive Shares Higher

TLDR

Table of Contents

Intel (INTC) is in early discussions with AMD to manufacture chips through its foundry business, sending Intel shares up 7% on Wednesday
AMD (AMD) stock climbed 2.27% in premarket trading after announcing an expanded AI partnership with enterprise AI firm Cohere
The AMD-Cohere deal will deploy AI models including Command A and North on AMD’s Instinct GPU infrastructure for enterprise and sovereign AI markets
Intel Foundry is actively seeking major customers to validate its manufacturing capabilities and compete with TSMC
AMD year-to-date performance shows 35.78% gains compared to the S&P 500’s 14.10%, with analyst price targets suggesting further upside potential

Advanced Micro Devices shares received a double boost this week. The stock gained momentum from two separate developments that highlight the company’s evolving role in the semiconductor landscape.

Intel announced early-stage discussions with AMD about manufacturing chips through its foundry business. The news sent Intel shares up 7% on Wednesday while AMD climbed over 1% during regular trading.

BREAKING: Intel stock, $INTC, surges over +7% on reports of talks of a deal to manufacture semiconductors for AMD.
This stock is now up over +70% since President Trump acquired a 10% stake in it just 6 weeks ago. pic.twitter.com/x8O6sTiufs
— The Kobeissi Letter (@KobeissiLetter) October 1, 2025

The potential manufacturing partnership would mark a major shift in the relationship between the two x86 chip rivals. AMD currently produces its chips exclusively with Taiwan Semiconductor Manufacturing Company.

For Intel, landing AMD as a foundry customer would validate its manufacturing capabilities. The company is working to rebuild its foundry business under CEO Lip-Bu Tan after years of manufacturing setbacks.

Industry analysts view a major customer commitment as essential for Intel Foundry’s credibility. Such a deal would encourage other chip companies to consider Intel for their production needs.

AMD Expands AI Footprint With Cohere Partnership

AMD shares rose an additional 2.27% to $167.74 in premarket trading on October 2. The jump followed the announcement of an expanded partnership with Cohere, a security-focused enterprise AI company.

The collaboration will run Cohere’s AI models on AMD’s Instinct GPU infrastructure. Models included in the deal are Command A, Command A Vision, Command A Translate, and North.

AMD will integrate Cohere’s North platform into its internal enterprise AI systems. The partnership targets both commercial enterprise applications and sovereign AI deployments.

Vamsi Boppana, AMD’s senior vice president of AI, said the collaboration would help organizations and governments scale AI operations. He emphasized the performance, efficiency, and memory capacity advantages of the combined solution.

The sovereign AI angle addresses growing government demand for domestic control of AI infrastructure. Nick Frosst, Cohere’s co-founder, pointed to AMD’s total cost of ownership as attractive for these deployments.

Stock Performance and Analyst Outlook

AMD closed regular trading on October 1 at $164.01, up 1.37% from the previous session’s $161.79. The stock has delivered 35.78% returns year-to-date, outperforming the S&P 500’s 14.10% gain.

Over the past year, AMD is up 2.67% compared to the S&P 500’s 17.56% return. The semiconductor sector has experienced volatility during this period.

The company trades with a market cap of approximately $266 billion. Its forward P/E ratio stands at 26.81, suggesting analysts anticipate earnings growth.

AMD’s next earnings report is scheduled for November 4, 2025. Analysts estimate an EPS of $1.17 for the quarter.

Analyst price targets for AMD range from $125.10 to $230.00. The average target of $185.77 implies potential upside from current levels.

The Cohere partnership represents AMD’s continued push into enterprise AI markets. The company is working to capture market share from Nvidia in AI accelerator chips.

Intel has recently attracted investment from the U.S. government, Nvidia, and Softbank. These investments are seen as confidence votes in Intel’s turnaround efforts, though Nvidia has not committed to using Intel’s foundry services.

Intel shares are up nearly 77% so far in 2025 as investor sentiment improves. Both Intel and AMD declined to comment on the manufacturing discussions beyond acknowledging they don’t comment on rumors or speculation.

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