By Kit Norton
Shares of Advanced Micro Devices rose on Monday after the chip maker announced it is buying a memory-optimization company to mitigate rising memory prices.
AMD said Monday it has acquired MEXT for an undisclosed amount. MEXT develops AI-powered software to make inexpensive flash storage.
AMD added that the acquisition expands its AI portfolio with the aim to help data center customers improve performance, reduce cost of ownership, and accelerate time to deployment.
"Demand for memory is growing across every category of enterprise compute. By combining the AMD leadership in high-performance computing and data center platforms with MEXT's memory optimization technology, we are taking another step to help customers deploy workloads more efficiently, cost-effectively and at greater scale," AMD said.
AMD shares were up 7.7% to $550.75 on Monday, amid a broad advance in AI and chip stocks. The S&P 500 had risen 1.8%.
AMD stock was approaching a record $900 billion market value, which would require shares to reach $551.94, according to Dow Jones Market Data. Its market value was around $895 billion on Monday.
Citi on Friday upgraded the stock to Buy from Neutral with a price target of $575, up from $460. The firm's optimism hinges more on AMD's graphic processing unit, or GPU, sales as the company goes head-to-head with market leader Nvidia.
AMD stock has surged 156% this year and has gained 334% over the past 12 months, driven mostly by demand for the company's AI-optimized central processing units.
A Morgan Stanley analyst team led by Shawn Kim wrote that surging memory prices and supply scarcity are becoming a risk across the digital economy.
"What began as an AI infrastructure bottleneck is now spreading into hardware margins, device affordability, cloud costs, inflation, and policy," Kim wrote earlier this month.
The latest sign of the memory-supply crunch came last week when Xbox CEO Asha Sharma said memory costs have risen roughly fivefold over the past two years and the company is unable to make as many consoles as consumers want.
Despite the shortage, Morgan Stanley believes that AMD is still in a good position.
"Agentic AI-driven CPU demand structurally favors AMD in cloud share gains," Kim wrote.
Write to Kit Norton at kit.norton@barrons.com
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(END) Dow Jones Newswires
June 15, 2026 13:19 ET (17:19 GMT)
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