Third Point’s Dan Loeb bought a passive stake in the chip maker AMDsources told CNBC’s Scott Wapner.

The hedge fund manager made the bet when AMD’s stock was struggling, the sources said. AMD shares have underperformed the rest of the sector over the past 12 months, falling more than 30% as the PHLX Semiconductor index fell 14%.

Stocks have recovered 21% this year as China opened up its economy and the overall stock market rebounded.

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AMD recently reported fourth-quarter earnings that beat Wall Street expectations, but are targeting a 10% year-over-year sales decline in the current quarter.

The semiconductor sector is struggling with declining consumer demand for finished electronics and a glut of parts needed to make PCs and servers.

Loeb is no stranger to the chip industry. He used to own it Intelmain rival AMD, prompting the company to explore “strategic alternatives” after the chip maker lost market share to TSMC.

Intel reported a disastrous quarter in January that included a weak forecast for 2023. The company said it expects sales to fall 40% year over year in the March quarter.

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