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Both Intel and AMD are reportedly running into supply issues when it comes to their server CPUs in China. According to Reuters , multiple customers received warnings from both chip makers, saying that deliveries will be delayed by several months. Sources cited in the report say that AMD has notified its customers that some of its CPUs will have delivery lead times of eight to 10 weeks, while Intel is warning of much longer delays of up to six months. These shortages mean that prices for server CPUs have started rising, with reports of Intel’s Xeon chips getting a 10% price bump, although the final cost may still depend on the customer contract.
The AI race and the accompanying massive infrastructure build out is pushing many chip fabs to their limits. It’s been said that data centers will consume 70% of memory chips in 2026 , driven by the massive demand for HBM. This resulted in massive price increases for consumer memory as manufacturers allocated their production lines to more lucrative products sold to price-insensitive industries. Aside from that, everything that requires memory chips — from RAM kits and consumer GPUs, to smartphones, smart TVs, and automobiles — has been hit by the shortage, and their manufacturers are struggling to find suppliers.
Some people say that customers have started buying completely new servers earlier than expected to avoid getting hit with the worst of the memory shortage. This led to an unexpected rise in demand that Intel and AMD are struggling to meet. Aside from that, the rise of agentic AI systems is further fueling demand for traditional servers. Although AI agents still need GPUs to “think,” they also need CPUs to “act.” So, aside from just buying thousands of AI GPUs for training and inference, hyperscalers are also increasing their CPU purchases so that they can accommodate the demands of agentic AI.
Dell and Lenovo set to increase server and PC costs by as much as 15% as soon as this month, according to industry sources
AI boom forces delays on Transcend SSDs, SD cards and flash drives
Key considerations
- Investor positioning can change fast
- Volatility remains possible near catalysts
- Macro rates and liquidity can dominate flows
Reference reading
- https://www.tomshardware.com/pc-components/cpus/SPONSORED_LINK_URL
- https://www.tomshardware.com/pc-components/cpus/intel-amd-server-cpus-reportedly-suffering-from-supply-shortages-in-china-leading-to-increased-prices-sources-say-orders-could-be-delayed-by-as-much-as-6-months#main
- https://www.tomshardware.com
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Informational only. No financial advice. Do your own research.