AMD stock spikes after Google confirms partnership for new video game streaming service

• AMD will power Stadia's graphics rendering in the cloud, Google announced at the event.
• AMD's stock jumped on the announcement.
• The deal marks a big win for AMD in the gaming space, where it competes with Nvidia.

David A. Grogan | CNBC

Lisa Su, President & CEO of AMD

Advanced Micro Devices spiked 11.8 percent Tuesday after Google confirmed the firm won a deal for its game streaming platform. Google unveiled the platform in an event Tuesday, where it shared its plans for a new gaming service called Stadia.

The rally brought AMD's market cap to roughly $26.1 billion, adding about $2.7 billion in value. AMD has jumped 127.5 percent over the past year, although it's still off from its peak price of almost $33 last September. AMD closed the day trading at $26 per share.

AMD will power Stadia's graphics rendering in the cloud, Google announced at the event, which AMD CEO Lisa Su attended. That marks a big win for AMD in the gaming space, where it competes with Nvidia on graphics chips. AMD's stock spiked more than 5 percent earlier in the day after Morgan Stanley told clients that AMD had won the deal, according to Barron's. The stock rallied even more after Google confirmed the deal on stage.

Stadia will allow players to jump into online games in minutes, rather than wait as much as several hours for a game to download on a computer or buy a physical copy.

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