On Tuesday, Advanced Micro Devices, Inc. (NASDAQ:AMD) CEO Lisa Su said surging demand from agentic artificial intelligence is dramatically expanding the long-term server CPU opportunity, prompting the chipmaker to double its market forecast to more than $120 billion by 2030.
AMD Raises Server CPU TAM As Agentic AI Accelerates Demand
During AMD's first-quarter 2026 earnings call, Su said the company now expects the server CPU total addressable market to grow more than 35% annually through the end of the decade, up sharply from its prior 18% projection shared in November.
"CPUs are a very critical part of data center infrastructure," Su said, adding that AI-driven workloads are increasing compute requirements much faster than anticipated.
AMD previously estimated the server CPU market would reach roughly $60 billion by 2030.
That figure has now doubled as enterprises and hyperscale cloud providers ramp AI deployments that require more CPUs for orchestration, inference and broader infrastructure support.
Lisa Su Says CPUs Are Essential To AI Infrastructure Boom
Su also said that while GPUs remain central to AI acceleration, CPUs are increasingly necessary for managing AI agents, processing data and supporting head nodes in data centers.
"As AI adoption scales, you need more inferencing," Su said. "They all require CPUs for orchestration and the data processing."
She added that AMD is seeing stronger-than-expected customer demand across cloud and enterprise markets, fueled by rapid adoption of agentic AI systems.
AMD Targets 50% Server CPU Share Amid EPYC Expansion
AMD also said it expects server CPU revenue to grow more than 70% year over year in the second quarter, supported by strong demand for its EPYC processor portfolio, including Turin and future Venice chips.
Su said AMD remains confident it can capture more than 50% of the growing server CPU market by expanding production capacity and broadening its processor lineup.
"CPUs are critical for so many tasks that you are seeing a lot more discussion about CPUs in the market," she said during the call.
AMD Q1 Earnings Beat Wall Street Estimates
AMD reported first-quarter revenue of $10.25 billion, surpassing Wall Street expectations of $9.89 billion. Adjusted earnings came in at $1.37 per share, ahead of analyst estimates of $1.29 per share.
The company's overall revenue climbed 38% compared to the same period last year.
For the second quarter, AMD projected revenue of about $11.2 billion, with a possible variance of $300 million, exceeding analyst forecasts of $10.52 billion.
The company also expects adjusted gross margin to improve to roughly 56%, up from 55% in the first quarter.
Price Action: In after-hours trading on Tuesday, AMD shares surged 16.54% to $414. During the regular session, it closed at $355.26, reflecting a 4.02% gain, according to Benzinga Pro.
According to Benzinga Edge Rankings, AMD is positioned in the 96th percentile for Momentum, highlighting robust performance across short, medium and long-term trading periods.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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