Shares of Advanced Micro Devices and Intel moved sharply higher on Thursday after analysts at Bernstein lifted their price targets for both semiconductor giants. The firm cited accelerating demand for server processors powering artificial intelligence data centers, alongside a landmark supply agreement with Meta Platforms, as key catalysts for the revised outlook.
By late morning trading in New York, AMD stock had advanced 5.8% to $273.19, while Intel climbed 4.1% to $67.57. Notably, both stocks were trading above Bernstein's newly established targets, reflecting strong market momentum. The analyst action underscores a broadening of AI-related investment beyond Nvidia's dominant accelerator segment, with demand rippling across the entire chip supply chain.
Revised Forecasts and the Meta Catalyst
Bernstein analyst Stacy Rasgon raised AMD's price target to $265 from $235 and increased Intel's target to $60 from $36. The firm maintained a Market Perform rating on both stocks. The upgrades were primarily driven by firmer expectations for server chip sales, even as the outlook for the personal computer market remains soft.
For AMD, Rasgon now projects sales of its EPYC server processors will surge by approximately 50% in 2026. A significant driver is the multi-year, multi-generation partnership with Meta announced in February, which Bernstein believes the market has not yet fully priced in. The deal calls for Meta to procure AMD Instinct GPUs with a capacity of up to 6 gigawatts, with the first gigawatt scheduled to ship in the second half of 2026. At the time of the announcement, the agreement was valued at as much as $60 billion over five years.
"Meta is making a big bet on AMD," AMD CEO Lisa Su stated regarding the partnership. Meta's move to secure long-term chip supply extends beyond AMD; the social media giant also recently extended its custom chip collaboration with Broadcom through 2029. This strategy highlights the scale of infrastructure needed, with Meta's infrastructure lead Santosh Janardhan noting it would require "multiple chip vendors and approaches."
Intel's AI Story and Upcoming Test
Bernstein also boosted its server revenue and gross margin projections for Intel, while trimming forecasts for its PC-related business. The firm now anticipates Intel's Xeon server-chip sales will increase by roughly 36% in 2026, with total revenue expected to reach $53.3 billion for the year—a figure still below the broader analyst consensus.
Intel faces a near-term test with its first-quarter earnings report scheduled for April 23. The company has been actively sharpening its AI narrative in recent weeks, highlighting an expanded collaboration with Google focused on its Xeon processors and custom Infrastructure Processing Units (IPUs). These specialized chips are designed to handle networking, storage, and security tasks separately from the main CPU. "Scaling AI requires more than accelerators," Intel CEO Lip-Bu Tan emphasized last week.
Broader Market Context and Supply Constraints
The positive sentiment for AMD and Intel unfolds against a backdrop of continued strain on the global semiconductor supply chain. Taiwan Semiconductor Manufacturing Company (TSMC), a critical foundry for both companies, recently described demand as "so strong" and noted that capacity remains under pressure. This tightness is a primary reason cloud service providers like Meta are entering into multi-year supply agreements to ensure access to critical components.
While Nvidia continues to lead the market for AI accelerator chips, the Bernstein note signals growing investor recognition of the opportunity for other players in the data center ecosystem. Foundry and equipment companies like ASML and TSMC have also raised their forecasts recently, pointing to sustained robust spending from cloud giants.
Cautious Optimism and Valuation Concerns
Despite the upgrades, Bernstein's outlook includes notes of caution. The firm maintained its neutral stance on both AMD and Intel shares and reduced its PC market forecasts. For AMD, Bernstein's second-quarter revenue estimate remains at $10.1 billion, below the consensus expectation of $10.5 billion.
Furthermore, several market watchers have flagged that Intel's recent stock surge brings valuation and execution risks into sharper focus. Both companies now trade above Bernstein's revised price targets, suggesting that any disappointment in execution or demand could lead to a pullback. The analyst moves reflect a nuanced view: strong sector tailwinds are clear, but stock-specific risks and high expectations warrant a measured approach.
