Advanced Micro Devices Inc. (NASDAQ:AMD) stock fell about 7% Thursday as renewed supply-chain concerns pressured semiconductor stocks during a broader risk-off session.

The decline outpaced the Technology sector's 2.7% drop and came as the S&P 500 fell about 1%, with investors pulling back from higher-risk technology names.

Supply Constraints Weigh On Chip Sentiment

Lam Research Corp. (NASDAQ:LRCX) highlighted near-term supply-chain constraints that could push some December-quarter shipments into March.

Lam still posted a record 40.2% operating margin and guided December-quarter revenue to $8.2 billion-$9.0 billion, compared with the $8.53 billion consensus estimate.

The company also said China accounted for 35% of September-quarter revenue, up from 26% in June, but expects that contribution to "decline significantly" in the December quarter.

Susquehanna Raises AMD Price Target

Susquehanna analyst Christopher Rolland maintained a Positive rating on AMD and raised his price forecast to $620 from $550.

However, the firm expects below-seasonal second-half client results for AMD and Intel Corp. (NASDAQ:INTC), citing PC builds that are tracking below expectations.

AI Spending Keeps Long-Term Focus Intact

Recent updates from Super Micro Computer Inc. (NASDAQ:SMCI) and Space Exploration Technologies Corp. (NASDAQ:SPCX) renewed optimism around AI server spending.

AMD stock gained more than 140% in 2026, supported by the company's shift toward AI data centers and commitments from major hyperscale customers.

Investors also remained cautious ahead of economic data and the Federal Reserve's rate decision, as higher borrowing costs could weigh on technology spending and semiconductor valuations.

Top ETF Exposure

The Defiance Inference AI Chip ETF (NASDAQ:AINF) holds a 9.73% weight in AMD, while the iShares Semiconductor ETF (NASDAQ:SOXX) carries a 9.47% weighting.

The Invesco AI and Next Gen Software ETF (NYSE:IGPT) has a 9.27% weight in the stock.

Because AMD represents a meaningful portion of these funds, significant ETF inflows or outflows can translate into corresponding buying or selling activity in AMD shares.

AMD Price Action: Advanced Micro Devices shares were down 8.08% at $508.05 at the time of publication on Thursday, according to market data.