Intel NASDAQ:INTC shares climbed about 4% in Tuesday trading after a Wells Fargo analyst raised the price target on Advanced Micro Devices NASDAQ:AMD, with investors viewing the firm's outlook for AI processors as potentially favorable for Intel as well, according to a Tuesday research note.
The analyst increased the target price on AMD to $615 and said demand for central processing units, or CPUs, could accelerate as artificial intelligence workloads increasingly shift toward inference, the stage where trained AI models generate responses. While the forecast focused on AMD, investors appeared to extend the outlook to Intel because both companies compete in the CPU market.
The note projected AMD's AI GPU revenue to expand from about $15.6 billion this year to $40.6 billion in 2027 and $63 billion in 2028. It also forecast CPU revenue growth of 68% in 2026, followed by gains of 28% in 2027 and 22% in 2028, suggesting broader demand across AI computing infrastructure.
Despite the upbeat industry outlook, the analyst noted that investors may continue weighing valuation differences across leading semiconductor companies.