Financial institution of America sees the server CPU market quintupling to greater than $170 billion by 2030, and it is betting on AMD, ARM, and Intel to journey the wave. The thesis hinges on one phrase: brokers.
BofA analyst Vivek Arya raised his 2030 server CPU whole addressable market estimate to $170 billion-plus from a previous $125 billion, representing a near-fivefold growth from the $35 billion market in 2025. The brand new forecast carries a 37% compound annual development charge by way of the last decade.
“We view the emergence of agentic AI as a robust demand accelerant that expands the CPU alternative and lifts each [Intel and AMD] and [Arm-based] challengers,” Arya wrote in a word following discussions on the BofA International Tech Convention. The logic is easy. GPUs practice and run AI fashions, however when an AI agent acts on a immediate, scanning an inbox for a flight affirmation, cross-referencing a calendar, executing a reserving, CPUs deal with these orchestration duties.
Extra brokers means extra CPU demand, and the trade is barely starting to deploy them at scale.
Arya responded by elevating value targets throughout the board. AMD obtained a $560 goal (up from $500) with a Purchase score, ARM was lifted to $335 from $245, and Intel obtained a uncommon double improve to Purchase.
Nvidia stays BofA’s high semiconductor sector decide.
AMD shares traded over 2% larger in pre-market buying and selling Thursday, whereas Intel surged 5% and ARM gained 2%. The strikes prolong a blistering run: Intel has rallied 436% over the previous 12 months, AMD has climbed 280%, and ARM has gained 182% 12 months up to now.
The CPU market’s growth is drawing in new contenders. Nvidia already sells its Grace CPU as a part of the Grace Blackwell superchip and has begun providing CPU-based servers.
Qualcomm is reportedly debuting its personal information middle CPU later this month, coming into an area the place x86 dominance is now not assured.
AMD can also be pushing x86 deeper into adjoining territory. At its Embedded Options Day in Seoul on June 10, the corporate unveiled its Ryzen AI Embedded P100 and X100 sequence, single-chip designs combining Zen 5 CPU cores, RDNA 3.5 graphics, and an XDNA 2 NPU delivering as much as 50 TOPS of AI acceleration. The chips goal automotive, robotics, and industrial automation, markets the place Arm-based rivals Nvidia and Qualcomm at the moment maintain the benefit.
The embedded push carries weight from AMD’s $49 billion Xilinx acquisition in 2022, which introduced 4 a long time of FPGA experience and greater than 400 partnerships into the fold. Lee Hee-man, head of Korea gross sales for AMD’s Adaptive and Embedded Computing Group, stated the corporate has secured 7,000 embedded prospects worldwide throughout automotive, healthcare, broadcast, and satellite tv for pc programs.
Whether or not x86 can carve significant share from Arm in automobiles and robots is a query that can take years of design wins to reply. However BofA’s 37% CAGR name on a $170 billion CPU market highlights that the server chip, lengthy overshadowed by GPUs within the AI narrative, is getting a second act from brokers that do not simply assume, however act.
