As markets get ready to start trading during the next quarter, there are a handful of key tech names that are looking to reverse their fortunes since the start of the year. Advanced Micro Devices, Inc. (Ticker: AMD) is at the top of the list, as shares have trended lower since the start of the year. Is Q2 shaping up to be a continuation of the bearish woes, or can bulls step up to the plate and turn the trend around?
How Much More Room Does A.I. Have to Run?
AMD’s business model has long been synonymous with cutting-edge innovation, extending well beyond traditional semiconductors. Over the years, it has transformed into a powerhouse of computing solutions, with its portfolio spanning high-performance CPUs (Ryzen), GPUs (Radeon), data center chips (EPYC), and emerging technologies like artificial intelligence and adaptive computing. This expansive vision has cemented AMD’s role as a disruptor with substantial long-term growth potential.
The company’s ability to ramp up production, coupled with its leadership in the data center and AI markets, generates robust cash flow. AMD’s strategic partnerships with leading foundries like Taiwan Semiconductor Manufacturing Co Ltd (Ticker: TSM) and its focus on advanced chip architectures—such as the 3nm process node—provide a competitive edge in a rapidly evolving industry.
In their last earnings report, AMD surpassed analyst estimates, posting earnings-per-share (EPS)* of $1.09, notably exceeding analysts’ expectations of $0.88. The next earnings report is set to be released on May 6. A strong result this time around may be enough to reverse the stock’s fortunes.
Traders that think this is a catalyst for further upside may find a position with Direxion’s Daily AMD Bull 2X Shares (Ticker: AMUU), which seeks daily investment results, before fees and expenses, of 200% of the performance of Advanced Micro Devices, Inc. common stock (Ticker: AMUU).
Below is a daily chart of AMD as of March 27, 2025.
Did DeepSeek Change the A.I Game Entirely?
AMD’s reliance on consumer electronics and enterprise spending makes it vulnerable to macroeconomic shifts. Potential budget cuts from initiatives like DOGE (Department of Government Efficiency) could slash funding for tech infrastructure, indirectly impacting AMD’s growth trajectory.
Intensifying competition in the semiconductor space—from rivals like Intel and NVIDIA, as well as emerging players in China—adds further pressure, with supply chain bottlenecks and rising wafer costs posing ongoing risks. Ever since the release of DeepSeek in mid-January, the market’s mood surrounding artificial intelligence seems to have soured.
If the current trajectory continues, Direxion’s Daily AMD Bear 1X Shares (Ticker: AMDD), which seeks daily investment results, before fees and expenses, of 100% of the inverse performance in common shares of Advanced Micro Devices, Inc. (Ticker: AMD) could see a sustained bid in the near-term.
Definitions and Index Descriptions
Editor’s note: Any and all references to time frames longer than one trading day are for purposes of market context only, and not recommendations of any holding time frame. Daily rebalancing ETFs are not meant to be held unmonitored for long periods. If you don’t have the resources, time or inclination to constantly monitor and manage your positions, leveraged and inverse ETFs are not for you.
Investing in the funds involves a high degree of risk. Unlike traditional ETFs, or even other leveraged and/or inverse ETFs, these leveraged and/or inverse single-stock ETFs track the price of a single stock rather than an index, eliminating the benefits of diversification. Leveraged and inverse ETFs pursue daily leveraged investment objectives, which means they are riskier than alternatives which do not use leverage. They seek daily goals and should not be expected to track the underlying stock’s performance over periods longer than one day. They are not suitable for all investors and should be utilized only by investors who understand leverage risk and who actively manage their investments. The Funds will lose money if the underlying stock’s performance is flat, and it is possible that the Bull Fund will lose money even if the underlying stock’s performance increases, and the Bear Fund will lose money even if the underlying stock’s performance decreases, over a period longer than a single day. Investing in the Funds is not equivalent to investing directly in AMD.
Originally published on April 16, 2025.
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An investor should carefully consider a Fund’s investment objective, risks, charges, and expenses before investing. A Fund’s prospectus and summary prospectus contain this and other information about the Direxion Shares. To obtain a Fund’s prospectus and summary prospectus call 866-476-7523 or visit our website at direxion.com. A Fund’s prospectus and summary prospectus should be read carefully before investing.
The Funds have derived all disclosures contained in this document regarding Advanced Micro Devices, Inc. from publicly available documents. In connection with the offering of each Fund’s securities, neither the Funds, the Trust, nor the Adviser or any of its respective affiliates has participated in the preparation of such documents. Neither the Funds, the Trust nor the Adviser or any of its respective affiliates makes any representation that such publicly available documents or any other publicly available information regarding Advanced Micro Devices, Inc. is accurate or complete. Furthermore, the Funds cannot give any assurance that all events occurring prior to the date hereof (including events that would affect the accuracy or completeness of the publicly available documents described above) that would affect the trading price of Advanced Micro Devices, Inc. have been publicly disclosed. Subsequent disclosure of any such events or the disclosure of or failure to disclose material future events concerning Advanced Micro Devices, Inc. could affect the value of a Fund’s investments with respect to Advanced Micro Devices, Inc. and therefore the value of the Funds.
Direxion Shares Risks: An investment in a Fund involves risk, including the possible loss of principal. Each Fund is non-diversified and includes risks associated with a Fund concentrating its investments in a particular security, industry, sector, or geographic region which can result in increased volatility. A Fund’s investments in derivatives such as futures contracts and swaps may pose risks in addition to, and greater than, those associated with directly investing in securities or other investments, including imperfect correlations with underlying investments or the Fund’s other portfolio holdings, higher price volatility and lack of availability. As a result, the value of an investment in a Fund may change quickly and without warning.
Leverage Risk: The Bull Fund obtains investment exposure in excess of its net assets by utilizing leverage and may lose more money in market conditions that are adverse to its investment objective than a fund that does not utilize leverage. A total loss may occur in a single day. Leverage will also have the effect of magnifying any differences in the Fund’s correlation with AMD and may increase the volatility of the Bull Fund.
Daily Correlation Risk: A number of factors may affect the Bull Fund’s ability to achieve a high degree of correlation with AMD and therefore achieve its daily leveraged investment objective. The Bull Fund’s exposure to AMD is impacted by AMD’s movement. Because of this, it is unlikely that the Bull Fund will be perfectly exposed to AMD at the end of each day. The possibility of the Bull Fund being materially over- or under-exposed to AMD increases on days when AMD is volatile near the close of the trading day.
Daily Inverse Correlation Risk: A number of factors may affect the Bear Fund’s ability to achieve a high degree of inverse correlation with AMD and therefore achieve its daily inverse investment objective. The Bear Fund’s exposure to AMD is impacted by AMD’s movement. Because of this, it is unlikely that the Bear Fund will be perfectly exposed to AMD at the end of each day. The possibility of the Bear Fund being materially over- or under-exposed to AMD increases on days when AMD is volatile near the close of the trading day.
Advanced Micro Devices, Inc. Investing Risk: AMD faces risks associated with: the highly-competitive nature of the semi-conductor industry, which includes large dominant participants; economic and market uncertainty; reductions in demand for its products; potential concentration of revenues in a few large clients; geopolitical events and pandemics; adequate protection of technology or other intellectual property; exchange rates; among other risks.
Semiconductor Industry Risk: Semiconductor companies may face intense competition, both domestically and internationally, may have limited product lines, markets, financial resources or personnel and may face risks related to the availability of materials.
Information Technology Sector Risk: The value of stocks of information technology companies and companies that rely heavily on technology is particularly vulnerable to rapid changes in technology product cycles, rapid product obsolescence, government regulation, and competition, both domestically and internationally, including competition from competitors with lower production costs.
Additional risks of each Fund include Effects of Compounding and Market Volatility Risk, Derivatives Risk, Counterparty Risk, Rebalancing Risk, Intra-Day Investment Risk, Concentration Risk, Market Risk, Non-Affiliation Risk, Security Volatility Risk and Cash Transaction Risk. Additionally, for the Direxion Daily AMD Bear 1X Shares, Shorting or Inverse Risk. Please see the summary and full prospectuses for a more complete description of these and other risks of a Fund.
ALPS Distributors, Inc.
