TLDR
- Bank of America raised its 2030 server CPU market forecast to over $210 billion, up from $170 billion
- Expected annual growth rate lifted to 36% from 30%, driven by AI agent workloads
- AMD named as top CPU pick for its dual leadership in frequency and core count
- Nvidia retained its position as BofA’s overall top semiconductor pick
- The broader data center systems market is forecast to reach $2.2 trillion by 2030
Bank of America has raised its outlook for the server CPU market, citing the rise of AI agents as a key driver of demand for central processing units inside data centers.
Analyst Vivek Arya updated the firm’s 2030 server CPU total addressable market estimate to more than $210 billion. That is up from a prior forecast of around $170 billion.
The bank says the new figure represents nearly five times growth from the roughly $35 billion level expected in 2025. The projected compound annual growth rate has also been lifted, from 30% to 36%.
The revision follows second-quarter earnings results and what the bank described as strong AI compute and memory demand trends.
Why CPUs Are Getting More Attention
Central to Bank of America’s updated view is a shift in how AI systems are being built. During the AI training era, data centers ran on a CPU-to-GPU ratio of roughly 1:4. The bank now expects that ratio to move toward 1:1 as agentic AI takes hold.
The reasoning is that CPUs are becoming the “orchestration control plane” for AI agents, meaning they coordinate workloads rather than just supporting them.
Bank of America argues this is not a case of CPUs replacing GPUs. Instead, it calls CPUs “additive to overall system TAM,” suggesting the two chip types will grow together.
The bank points to near-record GPU rental and memory spot prices as evidence of a broad compute shortage that likely extends to CPUs as well.
AMD and Nvidia Named as Top Picks
AMD was named the firm’s preferred CPU stock. Bank of America cited the company’s “dual leadership” in both frequency and core count across cloud and enterprise computing segments.
Advanced Micro Devices, Inc., AMD
Nvidia retained its spot as the firm’s top overall semiconductor pick, with the bank continuing to view AI infrastructure as a major and ongoing spending category.
Bank of America also flagged Intel as having foundry optionality worth watching. Arm was described as the fastest share gainer in the space.
The firm now sees CPUs accounting for roughly 10% of the overall data center systems market by 2030, up from about 7% during the training era.
The broader data center systems market is projected to hit $2.2 trillion by 2030, giving context to just how large the CPU opportunity could become.
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