Advanced Micro Devices (NASDAQ:AMD) is on track to surpass Intel Corp. (NASDAQ:INTC) in the CPU market, investment firm Raymond James projected.

Raymond James upgraded AMD to a strong buy from outperform and also raised its price target on AMD shares to $641 from $565, suggesting a 40% upside from Monday’s close, CNBC reported on Tuesday.

Analyst Simon Leopold stated on Tuesday, “AMD offers the strongest combination of direct earnings leverage, datacenter positioning and market-share gains.” He further noted that AMD’s growth trajectory should allow it to overtake Intel by 2027.

Raymond James anticipates the CPU market to reach approximately $201 billion by 2030. This comprises $33.5 billion in conventional data center CPUs, $83 billion in AI head-end CPUs, and $85 billion in agentic CPUs.

The firm expects the potential proliferation of agentic AI, or autonomous AI agents, to serve as the “principal new growth engine for the CPU market,” according to Leopold.

AMD Poised to Capture AI Chip Demand

Earlier this month, AMD announced plans for a record $5 billion bond sale to fuel its AI expansion. This move was aimed at providing the chipmaker with additional funding flexibility as it ramped up AI-related investments and managed upcoming debt maturities.

BMO Capital Markets initiated coverage of AMD with an Outperform rating and a $550 price target, citing its expanding AI infrastructure portfolio. Analyst Harsh Kumar highlighted AMD’s Helios AI rack as a key competitor to Nvidia Corp.’s (NASDAQ:NVDA) NVL72, with shipments expected to begin in September. AMD has already secured Helios design wins with OpenAI, Meta Platforms Inc. (NASDAQ:META) and Anthropic, potentially helping it gain AI infrastructure market share.

BofA Securities sees a $210.6 billion server CPU market by 2030, up sharply from $61.4 billion in 2026, as the rise of AI agents drives greater demand for CPUs alongside GPUs. The bank expects CPUs to become a key orchestration layer for agentic AI workloads, with the CPU-to-GPU ratio potentially moving toward 1:1.

AMD, Intel and Arm Holdings Plc (NASDAQ:ARM) are positioned to benefit, but BofA names AMD its top CPU pick, citing its broad portfolio and high core/thread counts. Arm is expected to gain the most market share, potentially reaching 47% of server CPU value by 2030, while Intel’s share could decline from 34% to 22%.

Benzinga’s Edge Rankings place AMD in the 93rd percentile for quality and the 95th percentile for growth, reflecting its strong performance in both areas. Benzinga’s screener allows you to compare AMD’s performance with its peers.  

AMD Price Action: On a year-to-date basis, AMD surged 104.39%, as per Benzinga Pro. On Monday, the stock declined 3.49% to close at $456.74.

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