AMD’s CPU Renaissance: Why the AI Boom Is Driving a Server-Silicon Power Shift

AMD beats Intel in data-center CPU revenue for first time, driven by agentic AI workloads. Q1 revenue up 57% to $5.8B, UBS sees server CPU market growing to $170B by 2030.

For months, the AI investment narrative has been dominated by graphics processors and the companies that make them. But a quieter — and potentially more structural — rotation is under way in the data center, where traditional server central processing units are staging a comeback. Advanced Micro Devices is the primary beneficiary, and the numbers released across its first-quarter earnings report and a fresh UBS analysis paint a picture of a company that has finally found the gear Wall Street has been waiting for.

Revenue in AMD’s data-center segment surged 57% year over year to $5.8 billion in the first quarter, pushing the unit past Intel’s comparable division for the first time. Intel’s data-center revenue came in at roughly $5.1 billion over the same period. The milestone is emblematic of a broader shift in x86 server silicon: UBS estimates that AMD’s share of server-CPU revenue climbed to 46.2%, while Intel’s slipped nearly five percentage points to 53.8%. In terms of units shipped, AMD’s volume rose 15% quarter over quarter, while Intel’s fell 1%.

The underlying catalyst is a new class of artificial intelligence workloads known as agentic AI. Unlike the large model training that has fueled GPU demand, agentic systems require CPUs to coordinate tasks, manage memory, and control execution of multiple parallel agents on a single processor. UBS argues that AMD’s combination of high core counts and multithreading gives it a structural advantage in this emerging market — one that could expand from roughly $30 billion today to about $170 billion by 2030. The market is already growing fast: overall server-CPU shipments climbed roughly 19% year over year, a historically strong rate driven by cloud hyperscalers that have increased their capital spending by an estimated 81% annually, according to UBS.

AMD’s management offered its own long-term forecast at the company’s annual shareholder meeting, where CEO Lisa Su revised upward the addressable market for server processors. The company now expects that market to reach $120 billion by 2030, a sharp increase from previous growth assumptions. Su attributed the upgrade to changing workload requirements, noting that AI tasks increasingly depend on traditional processors for data movement and orchestration. The optimism was backed by first-quarter results: total revenue rose 38% to $10.25 billion, and adjusted earnings per share hit $1.37, beating analyst estimates.

The data-center business now accounts for more than half of AMD’s total revenue, a structural turnaround from the days when PC chips were the dominant profit driver. That PC segment, however, remains under pressure. Shipments slumped 13% in the quarter, and UBS expects the global PC market to continue contracting in 2026, hurt by memory-price inflation. Even there, AMD is likely to keep taking share from Intel.

Shareholders endorsed the company’s direction at the meeting, approving the reappointment of Ernst & Young as auditor and authorizing an expansion of the equity participation program by 65 million shares. Director Jon Olson did not stand for re-election and left the board. The stock, which traded near €384 at the time of writing, has doubled since the start of the year and surged 264% over the past twelve months, hovering just below its 52-week peak of €389.50. At 65 times consensus 2026 earnings estimates, the valuation looks steep in absolute terms but is less daunting given the growth trajectory.

For the second quarter, AMD guided for total revenue of around $11.2 billion, representing roughly 46% annual growth, with server-CPU revenue expected to rise more than 70%. That projection will be the next major test of whether the company can deliver on its own ambitious expectations. Risks remain: heavy reliance on contract manufacturer TSMC, potential export restrictions, and tight capacity for high-bandwidth memory chips could cap how much of the projected $120 billion – or $170 billion – market AMD actually captures. For now, though, the narrative has shifted decisively from “Can AMD compete?” to “How fast can it scale?”