AMD Targets 50% Share of Agentic AI CPU Market

The emergence of agentic artificial intelligence is shifting data center demand toward central processing units (CPUs), which provide the sequential logic and API connectivity required by AI agents more effectively than GPUs.

Advanced Micro Devices is positioning itself as the primary beneficiary of this trend by developing purpose-built CPUs for agentic AI. The company has already secured significant inference GPU deals with OpenAI, Meta Platforms, and Anthropic, including a $100 billion agreement with Meta following the launch of the Muse AI agent. AMD projects the total data center CPU market will reach $220 billion and is aiming for a 50% market share.

Arm Holdings is also entering the server CPU market with a target of 15% market share and $25 billion in revenue by 2031. However, Arm faces challenges including a high valuation with a forward P/E ratio of nearly 140 times and declining volumes in the smartphone market.