Intel is entering a difficult rebuilding phase after a decade of manufacturing setbacks that allowed Advanced Micro Devices to steadily chip away at its data center dominance. AMD is now positioning itself to capture the next wave of AI-driven server demand, while Intel Chief Executive Lip-Bu Tan works to stabilize the company and regain lost ground.
Intel's troubles began with delays in its 10nm and 7nm process nodes, which weakened its data center roadmap and opened the door for AMD to reclaim relevance. A decade earlier, AMD had nearly been forced out of the server market, but the turnaround began in 2015 when then-new Chief Executive Lisa Su and CTO Mark Papermaster introduced the Zen architecture and set a long-term comeback strategy.
Industry analysts say AMD spent years rebuilding credibility with CIOs. Intel is now navigating a similar challenge. The company recently lost AI leader Sachin Katti to OpenAI, prompting Tan to take a more direct role in Intel's AI business.
AMD's diversified strategy and AI alliances
AMD and Nvidia have already forged ties with OpenAI. AMD is expected to begin supplying large-scale compute systems to the AI developer starting in 2026. Intel still holds potential advantages, including support from the US government, and industry observers say it remains a contender for future strategic partnerships with OpenAI.
AMD's resurgence has been fueled by a broader product shift. The company first rebuilt its CPU competitiveness and later expanded into GPUs, FPGAs and network accelerators through acquisitions of Xilinx, Pensando and ZT Systems.
Su said during a recent earnings call that AMD is prepared to expand further as AI adoption accelerates. She said AMD now offers reliable, high-performance CPUs and GPUs that can serve as alternatives to Intel and Nvidia and that the company aims to compete in full rack-scale AI systems starting in 2026.
Su sets aggressive growth and share targets
Su projected that AMD's data center AI revenue will grow at more than 80 percent annually over the next three to five years. She also forecast that AMD could capture more than half of server CPU revenue, over 40 percent of client CPU revenue and more than 70 percent of FPGA revenue.
New data from Mercury Research shows AMD continues to gain share across multiple CPU segments. AMD holds 30.9 percent of the overall x86 processor market, up six percentage points from 2024. Excluding semi-custom chips used in game consoles, its share is 25.6 percent, which is only a modest increase. The overall x86 market has been soft due to inventory buildup tied to tariff concerns.
Server market gains despite softness
AMD's server CPU share reached 27.8 percent in the third quarter of 2025, up 3.5 percentage points from the year before. Intel still controls more than 72 percent of the market, but AMD is seeing steady demand from cloud providers and enterprise customers. The company's EPYC processors now account for more than 40 percent of its total revenue.
Mercury Research noted that both Intel and AMD benefited from new server chip launches this year. Intel introduced its Granite Rapids Xeon 6 processors, while AMD rolled out its fifth-generation EPYC line. Higher average selling prices helped offset relatively flat shipment volumes.
AI server growth defines next battlefield
A key question is whether AMD can achieve Su's target of more than 50 percent of server CPU revenue share within five years. The general-purpose server market has been weak since 2022, with growth sustained mainly by high-end processors used in AI systems. That trend continued in 2024 as traditional server demand fell. The market is expected to recover in 2025 as companies replace aging systems, consolidate workloads and redirect power and space to support AI infrastructure. AMD expects the broader server market to grow into 2030.
Su stated that artificial intelligence workloads will demand a substantial volume of high-performance and costly processors. She forecasted that the market for AI server central processing units is expected to increase from approximately US$8.2 billion in 2025 to around US$30 billion by 2030.
Intel is also preparing for a new phase of competition. Nvidia's investment in Intel will not produce immediate gains, but analysts say the relationship could strengthen Intel's position in AI systems over time. As AMD raises its outlook for AI-driven server upgrades, Intel is signaling that it intends to fight for share rather than surrender more ground.
Source: AMD and The Next Platform, compiled by DIGITIMES, November 2025
Article translated by Sherri Wang and edited by Joseph Chen
