There's a quiet shift happening in the U.S. chip market, and the latest numbers tell a pretty clear story: Advanced Micro Devices Inc. (AMD) and Arm Holdings plc (ARM) are steadily pulling ahead of Intel Corp (INTC) in the race for PC and server market share. Intel might be getting better prices for its chips, but it's shipping fewer of them—and that's becoming a problem.
Bank of America Securities analyst Vivek Arya dug into fresh third-quarter 2025 central processing unit data from Mercury Research and found that AMD and Arm are growing faster than Intel across nearly every category. The culprit behind Intel's sluggish performance? Supply constraints at its Intel 7 and Intel 10 manufacturing nodes, which are throttling output and keeping unit growth anemic.
The Numbers Paint a Clear Picture
In the third quarter, Intel's PC unit shipments managed just 2% growth quarter-over-quarter, while server unit shipments actually declined 1%. Meanwhile, AMD shipped 10% more PC processors and 1% more server CPUs during the same period. Arm-based server shipments absolutely crushed it with a 16% surge.
To be fair, Intel did post some impressive average selling price gains—PC and server ASPs climbed 8% and 7% respectively quarter-over-quarter. That's Intel finally catching up with the strong mix and pricing trends AMD has been enjoying for the past year. But here's the thing: you can charge more per chip, but if you can't make enough of them, you're still losing ground.
Why AMD and Arm Are Winning Right Now
AMD is riding two major waves. First, there's the enterprise PC upgrade cycle driven by Windows 11 adoption—companies are finally refreshing their fleets. Second, and probably more important, there's robust demand for AI-capable server chips. When you're selling into the AI infrastructure boom, that's a very nice place to be.
Arm is also seeing pricing momentum as hyperscalers ramp up CPU core counts and deploy high-value solutions like Nvidia Corp's (NVDA) Grace processors and custom chips from Amazon.com Inc (AMZN), Microsoft Corp (MSFT), and Alphabet Inc's (GOOG) (GOOGL) Google. Arya noted that AMD extended its desktop lead and benefited from Intel's notebook shortages, while Arm-based servers gained more than 100 basis points in both unit and revenue share.
Looking Ahead: AI Is the Real Prize
The PC market outlook for the fourth quarter and 2026 is pretty modest—IDC and Gartner are forecasting low- to mid-single digit growth in 2025 and flat shipments in 2026. Arya thinks those numbers are conservative given the ongoing post-pandemic refresh cycle, but even if PC demand helps Intel stabilize its unit growth, the real action is in servers.
That's where AMD and Arm have the edge. Arya modeled industry CPU unit growth of 3% in 2025 and 1% in 2026, with most upside coming from richer ASPs. But the server opportunity is what gets interesting. AMD estimates a more than $60 billion CPU total addressable market by 2030 fueled by AI demand. Arya is more cautious, modeling a $33 billion to $36 billion market by 2027-28, noting that CPU value contribution in the broader $1 trillion-plus AI infrastructure opportunity still needs to become clearer.
The Bottom Line
Arya maintained Buy ratings on AMD and Arm based on their structural share-gain opportunities across both PCs and servers. He kept an Underperform rating on Intel, citing competitive challenges across both its x86 chip business and its foundry operations.
Sure, Intel's pricing momentum looks good right now. But when you're constrained by manufacturing capacity and watching competitors grab share in the hottest growth segment of the market—AI infrastructure—better prices only get you so far. As Arya put it, AMD and Arm remain the stronger long-term share-gain stories.
AMD Price Action: Advanced Micro Devices shares were down 4.11% at $230.62 at the time of publication on Tuesday, according to market data.
