Bank of America (BAC) has raised its outlook for the server CPU market and named Advanced Micro Devices (AMD) and Nvidia (NVDA) as its “top AI chip picks,” saying the growing use of agentic AI could create a much bigger opportunity for the server CPU market. The bank’s top analyst Vivek Arya now expects the server CPU market to grow from about $43 billion in 2026 to roughly $125 billion by 2030, higher than its earlier forecast of $110 billion.
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200% short exposure to NVDA with NVDSThe 5-star analyst said CPUs are becoming increasingly important as AI systems grow more complex. While GPUs remain critical for training AI models, newer agentic AI systems also rely heavily on CPUs to manage memory, coordinate tasks, retrieve data, and run multi-step workflows.
Infact, the bank described CPUs as becoming the “control plane” of AI inference.
Why BofA Likes AMD and Nvidia
Arya expects AMD to continue gaining share in cloud and enterprise servers, while Nvidia could benefit from combining CPUs, GPUs, networking, and memory into full AI systems.
BofA also noted that AI infrastructure spending is expanding rather than replacing existing data center demand. New CPU-heavy systems designed for workloads like vector databases, AI agents, and retrieval systems could create additional demand across the server market.
At the same time, Arya expects AI accelerators to remain the largest part of AI infrastructure spending, with the broader AI data center market potentially reaching $1.7 trillion by 2030.
It is worth noting that Arya ranks 94 out of more than 12,000 analysts tracked by TipRanks. He has a success rate of 64%, with an average return per rating of 27% over a one-year timeframe.
Nvidia’s Latest Earnings Also Support the Trend
Nvidia also highlighted the growing importance of CPUs during its latest earnings report. The company recently reported Q1 Fiscal 2027 adjusted earnings per share of $1.87, ahead of Wall Street estimates of $1.75, while revenue surged 85% year-over-year to $81.6 billion.
During the earnings call, Nvidia discussed its upcoming Vera CPU platform, which will launch alongside its Vera Rubin AI systems in the second half of 2026. BofA noted that future Nvidia AI systems could use far more CPUs alongside GPUs, reflecting the growing importance of CPUs in handling complex AI workloads and data center operations.
Which Is the Best AI Chip Stock, According to Analysts?
Using TipRanks’ Stock Comparison Tool, Nvidia appears to have the higher upside potential, with analysts expecting about 26% upside, compared with roughly 3% upside for Advanced Micro Devices.
Investors can dig deeper to decide which AI chip stock best fits their strategy. Below is a screenshot for reference.
