AMD Tops Q1 Revenue Forecasts, Lifts Confidence in Data-Center AI. Can the Shares Reach a New High?
AMD Is Up 11%, but Institutions Still See Bigger AI Gains Ahead | Smart Money Option
Against the backdrop of surging AI infrastructure enthusiasm and semiconductor stocks repeatedly hitting new highs, investors are increasingly betting on the “broadening AI beneficiary” theme. This year, as major cloud providers continue raising AI capital expenditures and data-center demand expands rapidly, more capital has begun re-rating second-tier AI infrastructure plays. Among them, $Advanced Micro Devices (AMD.US)$ jumps more than 11% on Thursday, extending its recent strong rally. Even after the sharp run-up in shares, the options market saw another massive bullish trade emerge: a long-dated call position worth more than $330 million, signaling that institutional investors remain optimistic on AMD’s medium- to long-term outlook.
From the options flow perspective, the standout trade was AMD’s August 2026 $380 call option, which saw roughly 35,000 contracts traded, including two major blocks of 27,500 contracts and 7,500 contracts, both executed around $96 per contract. The total premium associated with the trade exceeded $330 million. More importantly, the trade was flagged as “Opening,” while total volume far exceeded the previous open interest of roughly 1,180 contracts, strongly suggesting this was a newly established institutional position rather than a closing or rolling transaction. The directional message behind the trade is straightforward: investors are continuing to bet on further expansion in AMD’s AI-related business over the next year.
Notably, the institution did not choose far out-of-the-money “lottery ticket” calls, but instead accumulated deep in-the-money LEAPS calls. With AMD shares trading around $445, the purchased $380 calls carry a delta of roughly 0.73, making the position behave similarly to a stock holding. This type of trade resembles a “leveraged stock replacement” strategy rather than a short-term speculative bet on explosive upside. Compared with buying shares outright, long-dated LEAPS calls improve capital efficiency while capping maximum downside risk at the premium paid.
Fundamentally, AMD is increasingly emerging as a key beneficiary of the AI infrastructure expansion cycle. The company’s latest earnings report showed continued strong growth in its data-center segment, while demand for AI GPUs remained robust. As AMD’s MI-series accelerators gain adoption among major cloud providers, investors are beginning to reassess the company’s competitive positioning in both AI training and inference markets. With Nvidia GPUs still facing supply constraints, more customers are seeking secondary suppliers, placing AMD in a prime position to capture incremental AI demand.
At the same time, the AI rally itself is evolving from a “single-leader story” into a broader infrastructure-wide expansion theme. Recently, not only has AMD surged higher, but names including $Broadcom (AVGO.US)$, $Marvell Technology (MRVL.US)$, and $Arm Holdings (ARM.US)$ — along with optical networking, switching, and storage-related AI infrastructure plays — have also continued climbing. Market positioning is gradually shifting from “only $NVIDIA (NVDA.US)$ benefits” toward “the entire AI compute chain benefits.”
For investors, the signal from this massive options trade remains highly significant: institutional capital is not treating AMD as a short-term momentum trade, but rather as a core participant in the long-term AI infrastructure expansion cycle. However, after such a sharp rally, AMD’s near-term volatility could also increase substantially.
For investors bullish on the long-term AI theme while seeking risk control, deep in-the-money LEAPS calls may offer an attractive “stock replacement” strategy by improving capital efficiency while limiting downside exposure. Meanwhile, investors who still expect upside but believe gains may moderate over time could consider Bull Call Spread strategies to reduce premium costs. In addition, for those looking to accumulate AMD on pullbacks, selling Cash-Secured Puts may also be attractive, especially given elevated implied volatility levels that can generate relatively rich premium income.
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Disclaimer: Options trading entails significant risk and is not appropriate for all customers. It is important that investors read the Characteristics and Risks of Standardized Options before engaging in any options trading strategies. Opening new options positions close to or on their expiration date comes with substantial risk of losses for reasons that include potential volatility of the underlying security and limited time to expiration. Options transactions are often complex and may involve the potential of losing the entire investment in a relatively short period. Certain complex option strategies carry additional risk, including potential losses that may exceed the original investment amount. If applicable, supporting documentation for any claims will be furnished upon request.
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