Bank of America raised its global server CPU market forecast to more than $170 billion, citing agentic AI as a structural demand driver, while naming Nvidia (NASDAQ: NVDA) its top semiconductor pick for 2026.

Key Highlights

  • Bank of America raised its server CPU total addressable market estimate to over $170 billion from a prior $125 billion forecast.
  • The revised forecast implies a compound annual growth rate exceeding one-third through 2030, driven by agentic AI workload expansion.
  • Nvidia (NASDAQ: NVDA) remains BofA's top semiconductor sector pick, given its integrated advantage across processors, networking, and software.
  • AMD (NASDAQ: AMD) received a price target increase to $560, while Intel (NASDAQ: INTC) was double-upgraded to Buy.
  • Arm Holdings (NASDAQ: ARM) price target was lifted to $335, reflecting its growing role in AI server infrastructure.

Bank of America sharply revised its estimate for the global server CPU market to more than $170 billion, up from a prior projection of $125 billion, citing the emergence of agentic AI as the most powerful new driver of semiconductor infrastructure demand. The revision followed discussions with technology executives at the BofA Global Tech Conference.

Agentic AI systems, capable of planning, reasoning, and executing complex tasks with limited human oversight, are expected to require substantially more server processing power than conventional AI inference or large language model deployments. BofA projects the market could expand at a compound annual growth rate of approximately 37% between 2025 and 2030.

Nvidia (NASDAQ: NVDA) retained its position as the brokerage's preferred semiconductor holding, with analysts highlighting the company's comprehensive advantage across GPU processors, networking infrastructure, and the CUDA software platform. NVDA stock has been among the strongest performers in the semiconductor space in 2026.

Advanced Micro Devices (NASDAQ: AMD) received a price target increase to $560, implying meaningful near-term upside from mid-2026 trading levels. Intel (NASDAQ: INTC) was double-upgraded to Buy, a relatively rare action that signals a significant reassessment of the company's prospects in the agentic AI server market.

Arm Holdings (NASDAQ: ARM) also benefited from the revised outlook, with BofA raising its target to $335 from $245. ARM-based chip architectures are gaining traction in AI data centers due to their power efficiency advantages, and the agentic AI cycle is expected to accelerate adoption among hyperscale operators.

For investors seeking the best semiconductor stocks in 2026, BofA's revised framework suggests the AI chip opportunity is broader than the GPU layer alone, encompassing x86 and ARM-based CPU architectures as agentic workloads drive demand across the full server stack.