AMD Shares Surge as Intel Earnings Signal AI-Driven CPU Recovery

Shares of Advanced Micro Devices (AMD) climbed more than 12% on Friday, driven by a positive spillover effect from Intel's latest earnings report. While AMD released no company-specific news, investors reacted to Intel's strong performance, which highlighted a resurgence in demand for central processing units (CPUs) as firms expand their artificial intelligence capabilities. The rally underscores a shift in the artificial intelligence landscape. While graphics processing units (GPUs) have dominated the AI narrative, analysts suggest that CPUs are re-emerging as an indispensable foundation for the era of agentic workloads, creating a broader growth opportunity for the semiconductor sector beyond the current GPU-centric trend. D.A. Davidson analyst Gil Luria upgraded AMD to 'buy' from 'neutral,' raising the price target to $375, which implies a 22% upside from the previous close. Luria noted that the CPU market, previously considered stagnant, is now seeing significant upside as compute needs evolve. Intel's own outlook contributed to the optimism, with Citi analyst Atif Malik noting that Intel now expects double-digit server CPU unit growth in 2026, a sharp increase from previous forecasts of slight growth. Other firms, including Roth, have aligned price targets for Intel with peers such as AMD, Marvell (MRVL), Credo (CRDO), and Astera Labs (ALAB). Despite the optimism, some analysts remain cautious about market share dynamics. Barclays' Tom O'Malley indicated that a downside scenario for Intel could involve a loss of market share to AMD, suggesting that the two rivals may continue to battle for dominance in the AI-enhanced server market. Intel was trading around $81 early Friday.