Intel-AMD Deal Rumor boosted AMD shares by 12%, Stock crashed right after Intel refuted the news

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News spread by a tech-website about confirming Intel’s signed up deal with AMD on its Radeon graphics technology, was widely circulated over internet in the last few days, resulted in the increase of AMD’s shares by 12% in the stock market. But unfortunately, investors had to abide an instant loss when Intel stated the news as false.

A recent report by Barron’s claimed to have received a statement from an Intel Spokesperson saying, “The recent rumors that Intel has licensed AMD’s graphics technology are untrue.” The company refused to comment anything else on the matter.

A rumor surrounded the tech-industry on 15th May when a news was released by a website fudzilla claiming confirmation of the deal between Intel and AMD, licensing graphics technology. However, the report was soon to be found as hoax when Intel and AMD both denied signing any of such deal. It looks like the news report was based on personal judgments, rather than on facts.

Another news about Intel ending its agreement with Nvidia on GPU license had been circulating since months, and is now believed as true because Intel didn’t deny it so far, which could have given people an idea about what will Intel do to get a new license deal fixed, thus creating a new rumor about licensing AMD’s graphic chip.

People were expecting something like that to happen after end terms of Intel-Nvidia as it looked evident that Intel will need a GPU license in upcoming time because the Intel’s agreement with Nvidia was going to end in March 2017.

It was also expected that the official statement, revealing the deal will be placed when both of the companies would be having a Q2 earning releases. This news was circulating among the people since some months back and is regarded as a successful visionary decision to be for future. But as now the rumor has been rejected by Intel and AMD both, it looks like Intel has some other plans its GPU License venture.

Why did people actually fall for this rumor? The reason behind this dates back to 2011 when Intel signed an agreement for its graphic licensing with Nvidia. This contract worth around $1.5 billion dollars and the duration was of five years. From the initial time, Nvidia and Intel had so many disagreements over many issues like chipset and its licensing. It was mentioned that Intel is never allowed to actually construct the graphic chips along with the Nvidia technology; it had to only serve as a patent litigation.

The AMD Company only needs investment and for this purpose, licensing is a very effective path to generate a stream of revenue making for them for so many upcoming days. It really effects on their positive profit making and also improves the overall performance much more.

According to Tech Crunch, the Senior Vice President of the Radeon Technologies Mr. Raja Kaduri really helped in all the negotiation matters with the Intel and worked as a major part. Radeon Technologies in much more interested in coming up with new things and technologies.

They wanted to come up with some potential new products and it took some time for Intel to come up with any new architectural based design. If the rumor was true, this expected joint merger would have really affected the AMD’s bottom line reputation. It could allow Intel to go and access the Intellectual properties of AMD for the future purposes.

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