Raymond James upgrades AMD, sees $201 billion server CPU market by 2030

Raymond James upgraded Advanced Micro Devices (AMD) to Strong Buy in a note on Tuesday, incorporating its AI Factory framework into the server CPU market outlook. The firm predicts the server CPU market will expand at a 44% five-year compound annual rate, reaching approximately $201 billion by 2030. This market will be divided among $33.5 billion in traditional datacenter CPUs, $83 billion in AI head-end CPUs, and $85 billion in agentic CPUs.

Simon Leopold, an analyst at Raymond James, highlighted AMD's robust combination of direct earnings leverage, datacenter positioning, and market-share gains. Agentic AI emerged as the primary growth engine, driven by persistent agents performing orchestration, retrieval, database, sandbox, and tool-execution workloads, which primarily utilize CPUs. Leopold noted that demand increases with active agents, workflow duration, and concurrency rather than model parameters or token generation.

The base case aligns closely with Nvidia's ($200 billion) long-term framework, but falls short of AMD's own $220 billion estimate. Raymond James believes its model could see the $220 billion figure realized under a more aggressive scenario involving higher agent adoption. However, the firm cautioned that workload growth will not directly translate into shipments, as higher utilization, software efficiency, custom silicon, and offload will absorb a portion of the increase.

In other recommendations, Raymond James stated that Arm (ARM) benefits from server royalty growth and custom silicon, while Intel (INTC) faces potential share loss despite a stronger market.