AMD’s stock surged by nearly 8% on Friday following the revelation that IBM successfully ran a quantum error correction algorithm utilizing AMD’s field-programmable gate array (FPGA) chips. This groundbreaking development will be detailed in an upcoming research paper, showcasing AMD’s crucial role in advancing quantum computing technology.
Notably, an IBM spokesperson confirmed this significant milestone to industry observers, marking yet another triumph in the ongoing race towards practical quantum computing solutions. Both IBM and AMD experienced a stock uptick of around 8% on the same day, leading IBM to its most promising trading day since January.
This development follows the partnership announced in August between the two tech giants, aligning their efforts to innovate in quantum computing capabilities. IBM aims to introduce a large-scale, fault-tolerant quantum computer by 2029, with this announcement seen as a substantial leap forward in that journey.
The implications of quantum computing are profound, leveraging quantum mechanics to address problems beyond the reach of traditional computers. As major players like Google, Microsoft, and Amazon dive deeper into this sector, each is unveiling their own quantum processors to compete. Google recently launched its Willow chip, while Microsoft successfully introduced its first quantum chip last year.
Quantum Sector Gains Momentum
The excitement surrounding AMD and IBM’s announcements propelled stocks across the quantum computing arena, with companies like D-Wave Quantum, Rigetti Computing, and IonQ also seeing increased stock values. Despite a recent report suggesting the Trump administration was negotiating stake acquisitions in quantum companies, officials quickly denied such claims.
AMD’s stock reached an all-time high of $243.11 on October 24, 2025, representing an impressive 90% increase year-to-date. The company’s market capitalization has now exceeded $381 billion, solidifying its status as a leader in tech innovation.
Earlier this month, AMD announced major partnerships with OpenAI and Oracle, pledging to provide GPUs for massive AI infrastructure demands. This commitment involves supplying 6 gigawatts of computing capacity to OpenAI and deploying 50,000 MI450 Instinct GPUs in collaboration with Oracle Cloud starting in Q3 2026.
These strategic partnerships are projected to produce tens of billions in annual revenue, with cumulative sales potentially surpassing $100 billion. AMD’s CFO, Jean Hu, emphasized that the OpenAI deal is expected to be a significant revenue driver.
Financial Performance Remains Strong
In its Q2 2025 report, AMD disclosed a revenue of $7.69 billion, marking a 32% year-over-year growth. For Q3 2025, the company has projected revenues of approximately $8.7 billion, contributing to an anticipated full-year sales figure nearing $33 billion.
AI-related products now represent 21% of AMD’s total revenue, with data center revenue hitting $3.2 billion, reflecting a growth rate of 14%. AMD’s CEO, Lisa Su, credited the successful rollout of new products as vital to the company’s robust performance.
Despite facing a potential revenue obstacle of $1.5 billion in 2025 due to U.S. export restrictions on AI chip shipments to China, AMD continues to maintain strong market performance. Currently, the company trades at a P/E ratio of 140.52, with approximately 60-65% of analysts rating AMD as a buy, yielding a consensus price target of $249.92.
