Bank of America Merrill Lynch: Raises sales forecast for server CPU industry, raises target prices for AMD, Arm, and Intel

Bank of America Securities released a report, raising its sales forecast for the server CPU industry from 2026 to 2030, increasing the annual compound growth rate of server CPU industry sales from 13% / $590 billion to 15% / $710 billion. The main driving factors include: ultra-large data center operators accelerating their spending in response to the emerging Agentic AI; tight supply and product portfolio improvements driving CPU pricing increase. The bank also raised AMD's target price from $280 to $310, rating it as "buy"; raised Arm's target price from $155 to $180, rating it as "neutral"; and raised Intel's target price from $40 to $48. In the short term, Bank of America Securities believes that AMD is in the most favorable position, with its product line leading. Intel will also benefit, but they believe that the increase in market value of about $110 billion in the past 3 months is excessive. In the long term, the bank expects more intense competition in the CPU market, with various ARM architecture solutions emerging, including NVIDIA Vera, ARM AGI, and self-developed solutions from major cloud operators.