AMD Takes a Hit as AI Semiconductor Selloff Rattles Retail Investors

AMD shares fell roughly 8–9% on Wednesday, tracking a broader selloff in AI and semiconductor stocks.
Retail investors on Reddit are split: some see a healthy pullback, while others warn of a potential AI bubble bursting.
Despite the near-term pain, one analyst predicts AMD could double by 2028, citing major AI contracts and revenue growth.

Advanced Micro Devices (

$AMD) was one of the hardest-hit names in Wednesday’s market selloff, dropping roughly 8–9% as part of a broader rout in semiconductor and AI-related stocks. The decline came amid renewed geopolitical tensions, a surge in oil prices, and a market rotation away from the tech-heavy names that had led the rally for years. On Reddit, the conversation turned to whether the AI trade is finally running out of steam or merely taking a breather.

AMD

Reddit Reacts: Is the AI Trade Over?

The most upvoted post on r/wallstreetbets highlighted that Wall Street banks are issuing margin calls to hedge funds as AI stock collateral erodes. The post suggested that even professional investors got caught up in the AI rally at its peak. A separate discussion on r/stocks with over 500 upvotes asked whether the recent selloff in AI semiconductors is a normal pullback or the beginning of a bubble bursting. Many commenters pointed to

$AMD and other chipmakers as the canary in the coal mine.

On r/investing, users noted that while the Dow gained over 500 points,

$AMD dropped alongside Micron and Applied Materials. The consensus was that money is rotating out of semiconductors and into industrials and consumer names — a shift that could be healthy broadening or a defensive move ahead of the Fed decision and Big Tech earnings. Meanwhile, a post in r/stockmarket warned that even early AI investors could end up holding the bag, drawing an explicit parallel to the 1997 Nasdaq and the dot-com crash.

Not all the sentiment was bearish. A r/ValueInvesting post shared a WSJ article noting that value stocks are outperforming growth this year, powered in part by AI stocks that have been reclassified into value indices. The piece suggests that companies with strong fundamentals and AI exposure — like

$AMD — may fit a new definition of value investing.

News Context: Market Turmoil and a Long-Term Bull Case

Wednesday’s broader market decline was driven by escalating Middle East tensions and a selloff in chip stocks, with the Nasdaq falling 1.3% and semiconductor stocks extending a 10% weekly decline. Oil prices surged over 6%, adding to the risk-off tone. Amid the chaos, The Motley Fool published a prediction that

$AMD stock could double by 2028, citing multi-year contracts with Microsoft, Meta, OpenAI, and Anthropic, and projected revenue growth from $50 billion to over $100 billion. The article noted that even with P/E compression, the stock could appreciate 101% by 2028.

For retail investors on Reddit, the question is whether the current drawdown is a buying opportunity or a warning sign. The debate over

$AMD and the broader AI trade is far from settled.

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