AMD Shares Spike On Microsoft Acquisition Rumors

Investors seem intrigued by the idea that Microsoft might be interested in acquiring Advanced Micro Devices (AMD), hence a modest surge in AMD's stock price. Shares of AMD spiked 14 percent to $2.10 with a lot of trading activity on Friday after reports of Microsoft's possible interest hit the web.

In case you started the weekend early and ducked out of the Internet on Friday, news and rumor site Fudzilla said it heard from "industry sources" that talks between Microsoft and AMD about a buyout had become serious and that the discussion has been an ongoing thing for a while now. The news spread like wildfire.

AMD Headquarters

What makes the report even more interesting is AMD's recent decision to split its graphics division into a separate business under its newly formed Radeon Technologies Group. AMD explained that it was "putting in place a more agile, vertically-integrated graphics organization focused on solidifying our position as the graphics industry leader." Should the rumor of a buyout be true (and color this editor skeptical), one possible scenario is that Microsoft could buy AMD's CPU business to bring chip development in-house for products like its Surface.

Whatever the case might be, AMD's stock is benefiting from all the speculation and chatter. Though down from Friday's surge, AMD's share price is currently trading at $1.93, up from a 52-week high of $1.61. That puts AMD's market capitalization at $1.5 billion.