On October 20-22, by the banks of Shanghai's Huangpu River, the 2026 Sustainable Global Leaders Conference returns once again. Nobel Prize and Turing Award winners will take the stage to discuss the future and trends of technology, and the internet-famous professors who "rescue" people from anxiety and the era of involution—Macfarlane and Xiang Biao—will engage in a live dialogue!
Limited seats available, first come first served. Let us embark on this journey toward sustainability together! [Click to register] TD Cowen reiterated its "Buy" rating and $675 price target on Advanced Micro Devices (AMD) on October 19, citing that the rapid growth of autonomous AI agents (Agentic AI) and AI inference workloads in production environments is driving a recovery in data center CPU demand.
The firm noted that as AI applications shift from model training to actual deployment, CPUs are becoming increasingly important in areas such as multi-step task coordination, tool invocation, API management, and sequential decision-making. AMD has previously raised its CPU total addressable market (TAM) forecast to $220 billion and expects its server CPU business revenue to grow 70% year-over-year in 2027.
AI Agents Drive CPU Demand, AMD Expands Potential Market to $220 Billion
TD Cowen believes that as AI agents begin to take on complex business processes, CPUs are becoming key beneficiaries of AI infrastructure investment. Unlike GPUs, which are primarily responsible for large-scale parallel computing, CPUs are better suited for handling multi-step workflow coordination, external tool invocation, API request management, and decision-making tasks that require sequential execution. This means that the deeper AI applications penetrate into actual enterprise production environments, the more demand for general-purpose computing resources may grow accordingly.
Earlier this year, AMD nearly doubled its total addressable market (TAM) forecast for its CPU business to $220 billion and projected that its server CPU business revenue would grow 70% year-over-year in 2027. TD Cowen pointed out that the proliferation of AI agents and production-grade inference applications is creating clearer commercial demand, providing new growth momentum for the server CPU market.
Based on sustained strong data center CPU demand, TD Cowen also slightly raised its earnings forecasts for AMD and Intel. AMD's revenue grew 40% year-over-year over the past 12 months, and market analysts expect its fiscal 2026 revenue to grow 47%, reflecting that the company's server processor and AI-related businesses remain in an expansion phase.
Wall Street Bullish on AMD's Server Business, Citi Raises Price Target to $800
Recently, multiple Wall Street institutions have raised or maintained positive ratings on AMD, primarily based on the growth of AI agent applications, expanding server processor demand, and the commercialization prospects of next-generation AI computing systems. Citi raised its price target on AMD to $800, believing that the continued growth in AI agent application demand will drive the company's business expansion. Stifel raised its price target to $700 and maintained a "Buy" rating, mainly bullish on the strong performance of the server business. Cantor Fitzgerald reiterated its "Overweight" rating and $700 price target, focusing on the potential contribution of AMD Helios system shipments to future performance. TD Cowen maintained its $675 price target this time. Based on the reported stock price of $546.68, this implies approximately 23.5% potential upside. Although AMD has fallen about 11% over the past week, its stock price is still up 147% year-to-date in 2026, indicating that the market maintains high expectations for its long-term AI business growth.
AMD Plans to Significantly Increase Chip Supply in 2027 to Meet AI Computing Demand
AMD CEO Lisa Su recently confirmed that the company plans to significantly expand its chip supply scale in 2027 to address growing artificial intelligence computing demand. As cloud computing companies and large institutions accelerate AI infrastructure construction, AMD is simultaneously expanding its server CPU and AI chip businesses, striving to gain more share in both general-purpose computing and AI-specific computing markets.
The core judgment of TD Cowen's research report is that AI infrastructure demand is expanding from GPU training clusters to a broader range of computing tasks. As AI agents gradually enter actual production environments, enterprises need not only more powerful AI chips but also more CPUs to perform complex task scheduling and system management. This shift is expected to bring new growth space for AMD's server CPU business and support the firm's maintenance of a positive investment outlook.
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