Key Points
A major tech industry investor is plowing $2 billion into a U.S. microchip company.
That company isn’t AMD, however.
10 stocks we like better than Advanced Micro Devices ›
On Tuesday, the No. 1 tech sector, water cooler conversation item was a giant financial company’s investment into a major American chip maker.
Unfortunately for shareholders of American Micro Devices (NASDAQ: AMD), their company wasn’t the one chosen by the suitor. With many investors surely feeling left out, they assertively traded out of AMD stock, leaving it with a more than 5% loss on the day. The S&P 500 index also declined, but its fall was far less steep at 0.6%.
Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Learn More »
Taking the decision hard
The company doing the investing was SoftBank, and its target was not AMD but the U.S. company’s longtime rival Intel.
Image source: Getty Images.
After market close Monday, SoftBank announced that they had signed an agreement with Intel to invest $2 billion in the latter’s common stock. That shakes out to $23 per each of the chip maker’s shares, so it was hardly surprising that Intel vaulted past that level with a nearly 7% rise.
At a stroke, the deal makes SoftBank an important institutional investor in Intel (it’ll be the fifth-largest investor overall). All told, it will hold around 2% of the American company.
For better and for worse, chip makers in this country have been flagged as businesses that could help widen the U.S. manufacturing base. This is a key goal of the Trump administration and a leading reason for its recent efforts to levy tariffs on the top trading partners of this country.
Knee-jerk reaction
Intel had been struggling more than AMD recently, so in many ways it’s a more appropriate recipient of a chunky investment. That said, $2 billion is a large amount of capital for a company of any size, so that “shunned fiancé” feeling is completely understandable. It doesn’t, however, change the outlook much for AMD, so perhaps the Tuesday slump will provide a good buying opportunity in the stock.
Should you invest $1,000 in Advanced Micro Devices right now?
Before you buy stock in Advanced Micro Devices, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Advanced Micro Devices wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Netflix made this list on December 17, 2004… if you invested $1,000 at the time of our recommendation, you’d have $671,466!* Or when Nvidia made this list on April 15, 2005… if you invested $1,000 at the time of our recommendation, you’d have $1,115,633!*
Now, it’s worth noting Stock Advisor’s total average return is 1,077% — a market-crushing outperformance compared to 185% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.
See the 10 stocks »
*Stock Advisor returns as of August 18, 2025
Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Advanced Micro Devices and Intel. The Motley Fool recommends the following options: short August 2025 $24 calls on Intel. The Motley Fool has a disclosure policy.
