A Big China Catalyst Could Be Coming for AMD Stock in 2026. Should You Buy Shares Now?

It looks like after Nvidia (NVDA), Advanced Micro Devices (AMD) is next in line to rehash a deal to resume the sales of its chips to China. After CEO Lisa Su had a meeting with China's Commerce Minister Wang Wentao in Beijing last week, reports have emerged that the country's tech giant Alibaba (BABA) is mulling ordering some of AMD's MI308 GPUs. According to this report, Alibaba could order between 40,000 and 50,000 of these GPUs. This could imply a revenue windfall in the range of $600 million to $1.25 billion for AMD.

But, before one jumps the gun over here, there are some unpleasant facts that one must consider. Firstly, though the U.S. has approved the sale of Nvidia's H200 chips to China, the Chinese regulators have not yet given their approval. So, the chances of AMD getting approval are also low at this point. Secondly, Alibaba is itself a chipmaker, although its chips are more of the ASIC kind rather than AMD's general-purpose chips. This means the latter has broader use cases than Alibaba's chips, which are optimized for its native cloud ecosystems and inference workloads.