Cathie Wood's Ark Invest Bets Big on AMD Amid AI Chip Race

Ark Invest's Strategic Portfolio Shift

Cathie Wood's Ark Invest made significant portfolio adjustments on Monday, prominently acquiring shares of Advanced Micro Devices Inc. (AMD) while reducing positions in Coinbase Global Inc. This move signals a strong vote of confidence in AMD's positioning within the AI infrastructure race 1

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AMD's Ascent in the AI Chip Market

Ark purchased 356,275 AMD shares across multiple ETFs, including Ark Fintech Innovation ETF (ARKF), ARK Innovation ETF (ARKK), and ARK Next Generation Internet ETF (ARKW). The transactions, worth approximately $50.55 million, come as AMD navigates supply-chain dynamics and intensifying competition in accelerated computing markets 1

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AMD's recent performance has been noteworthy:

• Shares have risen 17% in 2025, outperforming the broader market
• The stock has surged 86% since early April, recovering from earlier setbacks
• Revenue growth has accelerated in recent quarters, culminating in a 36% jump in the latest quarter
• The data center business saw a remarkable 57% increase, driving overall growth 2

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Challenges and Opportunities in the AI Landscape

While AMD's growth is impressive, it faces stiff competition from industry leader Nvidia. Nvidia saw its revenue skyrocket 69% in its latest fiscal quarter, setting a high bar in the AI chip market 2

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1. China's DeepSeek announcement about using older, cheaper Nvidia chips for AI applications initially caused concern among investors
2. Rising trade tensions with China have led to export restrictions, impacting sales forecasts

Despite these hurdles, demand for high-tech GPUs remains strong, driving the recent stock rallies for both AMD and Nvidia 2

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Coinbase Reduction and Other Trades

In contrast to the AMD purchase, Ark sold 124,892 Coinbase shares across its ETFs, a transaction valued at $43.77 million. This reduction comes despite Bernstein's recent $510 price target for Coinbase and its "Amazon of crypto" endorsement 1

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Other notable trades by Ark Invest included:

• Reducing holdings in Elbit Systems Ltd (ESLT) by 1,160 shares across ARKQ and ARKX funds 1

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AMD's Financial Outlook

AMD's recent performance has made its stock valuation more attractive:

• Trading at 37 times this year's projected earnings
• Forward P/E ratio of about 25 based on next year's projections
• Analysts forecast a 48% earnings improvement for AMD next year 2

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As the AI chip race intensifies, AMD's growing momentum in the data center market and Cathie Wood's significant investment suggest a potentially bright future for the company in the evolving AI landscape.