When AI chips come up, Nvidia GPUs are the first thing most people think of. But once AI stops at answering questions and starts moving between several programs to handle real work, the CPUs working alongside them inside the server get busier too.
That's why Intel is getting attention again.
On October 19, JPMorgan raised its rating on Intel from 'Underweight' to 'Neutral.' But its price target was $85, lower than that day's close of $92.03.
It accepted that CPU demand could grow. It wasn't convinced Intel would come back.
So will the spread of AI agents give Intel a way to grow again? Two things matter. How big the server CPU market actually gets, and how much of that demand Intel can take as its own share.
Why Do More AI Agents Mean More CPUs?
Say you tell an AI, 'Analyze last quarter's sales and make a report.' When the AI model calculates its answer, GPUs are far more efficient. But the job doesn't end at generating an answer.
The agent has to log into the accounting system, check permissions, query a database, run a calculation tool, review the result, and then save the report.
Along the way, the CPU's work grows: running the operating system and programs, and connecting several services.
✦ GPU and CPU: Different Jobs in the Server
Complements that work together, not substitutes
In short, GPUs process large model calculations fast, and CPUs coordinate the server's general programs, data movement and task order. They're closer to complements working together on one server than to substitutes.
The more an agent calls several tools over and over instead of answering once and stopping, the more CPU, memory and network resources it naturally needs.
How Fast Is the Server CPU Market Expected to Grow?
Market research firm TrendForce forecasts that as AI agents' inference work grows, server CPU shipments will rise 31% in 2026 from a year earlier, and more than 40% in 2027.
GPUs staying the star of AI server investment doesn't change. But the view that you can't handle a data center's whole workflow by adding only GPUs is getting more important.
✦ TrendForce: Server CPU Shipments and Arm Share
Forecasts from a market research firm, not final results
TrendForce, based on major data centers' plans, said the ratio of CPUs to GPUs and ASICs (dedicated chips designed to handle specific jobs fast and efficiently) could go from the traditional 1 to 8 to 1 to 2, and close to 1 to 1 in some setups.
It isn't a ratio that applies to every data center, but it's a forecast that the CPU resources in one AI server could matter more.
Morgan Stanley also estimated that agentic AI could create an additional $32.5 billion to $60 billion in demand by 2030, on top of a data center CPU market already above $100 billion.
Whether the numbers come true depends on how fast adoption actually goes. But the analysis is that AI investment money that was focused on GPUs will spread out toward CPUs and memory.
Is Intel's Earnings Recovery Real?
Intel's Q2 2026 revenue was $16.1 billion, up 25% from a year earlier. Data center and AI segment revenue was $6.3 billion, up 59%.
✦ Same Quarter: GAAP Loss, Non-GAAP Profit
Don't swap the two measures
The GAAP loss per share was $2.16. But on a non-GAAP basis, where the company adjusts some items, it said it actually earned $0.42 per share.
✦ Intel's Q2 2026 Results
Read GAAP and non-GAAP earnings per share separately
Intel explained that a big contributor to Q2 product revenue growth was a higher average selling price, thanks to a larger share of high-priced products tied to data centers and AI. Anyway, it's true the results themselves are good compared with last year.
What Stands in Intel's Way Is Supply and Competition
Even if the server CPU market grows, Intel will miss the chance if it can't supply the chips customers want on time.
TrendForce pointed out that process and packaging problems in Intel's new products are delaying shipments, and that internal capacity limits make it hard to fill every order.
News that demand is strong and the ability to turn that demand into deliveries are different things.
Competition is heating up too. Beyond AMD's EPYC, Arm-based CPUs like Amazon's Graviton, Google's Axion and Microsoft's Cobalt are going into cloud data centers.
TrendForce forecasts that AMD's server CPU share could reach about 27% in 2026, and that Arm-based chips will pass 20% in 2026 and climb to about 30% in 2027. If so, even as the market grows, there's a limit to Intel's slice.
Look at JPMorgan's estimate. Intel's share of the server x86 CPU market was 77% when JPMorgan downgraded it in November 2022, but has recently fallen to 53%.
The figure is an estimate by a JPMorgan analyst, but it shows how hard it is for Intel to win back its old edge. There are plenty of tough rivals, AMD and Arm among them.
✦ Intel (INTC) Closing Prices
Sep 28 - Oct 23, Nasdaq regular-session closes, USD
Reflecting those worries, Intel's stock fell about 22.7%, from $112.50 at the October 6 close to $86.96 on October 23. On October 22 it dropped 8.04% in a single day, then bounced 1.72% the next day.
✦ Intel vs. AMD, Relative Performance
Last 3 months, indexed to 100 on Jul 23, Nasdaq regular-session closes
Of course, Intel wasn't the only one to fall on the 22nd. The Nasdaq Composite dropped 2.60% and the Philadelphia Semiconductor Index plunged 6.7%. It was a day when worries about whether AI investment can last shook the whole chip sector.
Three Things to Check in the October 29 Earnings
✦ Intel and the CPU Market: Key Timeline
From earnings to rating changes to forecasts
Intel will report Q3 earnings after the US market closes on October 29, local time. That's early on October 30 in Korea. What matters isn't only whether revenue lands inside the guided range of $15.8 billion to $16.8 billion.
We need to watch whether the data center and AI segment keeps growing, whether supply constraints ease so orders turn into shipments, and whether margins and cash flow improve too.
The spread of AI agents is creating a new opportunity in the CPU market. But to seize it, Intel has to produce and deliver on time for customer demand, hold on to the share lost to AMD and Arm-based chips, and turn revenue into profit and cash.
What matters more than the forecast that the CPU market will grow is how much of that market Intel actually takes. These earnings will be the first gate to check that difference.
This isn't investment advice. You know that, right? Let's each protect our own hard-earned money.
That's all for this post. See you next time.
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🌐 Korean version: AI 에이전트가 인텔을 살릴까? CPU 수요 반등과 인텔의 진짜 과제
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