The Motley Fool favors AMD over Arm for agentic-AI data-center chips, citing AMD's forecast of a $220 billion server-CPU market and potential 50% share. It calls Arm a sell, pointing to a forward P/E near 140 and expected smartphone-volume declines.
The article says agent-focused AI servers are projected to have a 1:1 GPU-to-CPU ratio, compared with 8:1 for LLM training and 4:1 for inference. It also cites AMD's two $100 billion deals with OpenAI and Meta and a third sizable deal with Anthropic.
Arm projected in March that it could capture 15% of a potential $100 billion market by 2031, with $25 billion in revenue—including $15 billion from server CPUs—and earnings per share of $9. The article says AMD and Nvidia have since forecast a larger market and argues Arm's move into chipmaking will compress its gross margins.
