Intel Corporation (NASDAQ:INTC) stock is on track for its worst day in over a year after the company reported a massive security flaw that has put millions of computers at risk. The Intel security flaw could prove to be a windfall for Advanced Micro Devices, Inc. (NASDAQ:AMD) and NVIDIA Corporation (NASDAQ:NVDA), or at least, investors seem to think so.
Intel stock slumps as AMD stock and NVIDIA stock surge
Intel stock and AMD stock are the two most heavily traded stocks in the S&P 500 Index, according to MarketWatch. By early afternoon, more than 60 million shares of Intel stock had changed hands, while about 90 million shares of AMD stock had been traded. By comparison, Intel’s 50-day average daily trading volume is at roughly 29.5 million, while AMD’s average daily volume stands at about 52.4 million.
AMD stock surged by about 9% in intraday trading on Wednesday, climbing as high as $12, its highest level in two months. In contrast, Intel stock tumbled by about 6% to as low as $43.65, tracking toward its worst one-day loss by percentage since October 2016.
NVIDIA stock also surged on Wednesday, climbing by more than 6% to as high as $211.99, which is its highest intraday level since late November. The jump in NVIDIA stock is presumably also due to the reported Intel security flaw. Other semiconductor stocks also gained, although on a much smaller scale, with Micron Technology, TSMC and STMicroelectronics.
Intel security flaw reported
The Register reported late Tuesday that a serious flaw with Intel processors is putting millions of computers at risk. The British tech website called the Intel security issue a “fundamental design flaw” and said that Microsoft Windows and Linux will have to roll out major security patches to fix it.
Additionally, the website stated that the needed security updates “will incur a performance hit on Intel products” running on Windows and Linux. The same flaw is reportedly in almost every Intel chip that has been made within the last ten years.
The Register also cited an AMD employee’s post which implied that AMD chips are “not affected” by the security problem, which is why AMD stock has benefited the most from the reports about the Intel security flaw. Apple’s OS X is also reportedly affected by the Intel security flaw, and a negative performance impact is also expected from the patch needed to fix it.
According to Bloomberg, design flaws in chips are rare. It’s been over 20 years since another issue was delivered with early Intel Pentium chips. The chip maker ended up issuing a recall and took a charge in excess of $400 million in connection with that flaw.