Advanced Micro Devices (AMD) shares soared nearly 14% to $350 Friday, fueled by Intel's stronger-than-expected Q1 earnings and a bullish analyst upgrade. D.A. Davidson raised its price target to $375 from $220, citing accelerating demand for CPUs to power AI agent workloads.

The rally reflects a broader chip sector rebound. Intel's data center sales beat signaled enterprises are prioritizing inference infrastructure - where trained AI models execute tasks. "We view Intel’s results as a precursor for AMD’s CPU franchise acceleration," wrote Davidson’s Gil Luria.

Behind the momentum: the AI stack is shifting from training to deployment. As enterprises operationalize large language models, they require massive CPU upgrades. AMD’s next-generation chips position it to capture this wave.

Market dynamics favor AMD. Jefferies analysts note the company is gaining server market share from Intel. When AMD reports earnings May 5, investors will scrutinize data center growth for confirmation of this thesis.