China is ramping up its efforts in the design and assembly of servers and other data centers, primarily focused on artificial intelligence. As a result, demand for components remains strong. While this certainly applies to graphics cards—for which access to cutting-edge NVIDIA and AMD GPUs is limited—the processor market is also affected. In fact, demand is so high that prices for certain AMD and Intel CPU models have risen by 40% since the start of the year!
China’s insatiable appetite for processors is a boon for Intel and AMD!
Some models have seen much higher prices since the start of the year!
Of course, when many companies place bulk orders, prices often go up… They rise even more when the companies manufacturing the hardware can’t keep up with demand—which is the case for Intel, as the company has acknowledged—but AMD is also struggling to keep up. In any case, prices are rising—and quite sharply. Since the start of the year, prices for certain CPU models have risen by as much as 40% or even more.
In this context, AMD and Intel are taking advantage of the situation to sign lucrative contracts. We’re talking about long-term supply contracts lasting one or two years—or even longer, depending on the customer. It’s also worth noting that under these conditions, prices are negotiated on a case-by-case basis and depend largely on the order volume and the duration of the delivery period.
A Supply Chain Under Strain:
However, these large order volumes are putting the supply chain under strain. This results in very long delivery times, as Intel reports that its 4th- and 5th-generation Xeon processors can take up to six months to arrive. On the AMD side, the situation is a bit more manageable, with delivery times measured in weeks: eight to ten weeks.
However, this severe strain also risks creating temptations, such as in the memory sector. Indeed, with rising prices and supply difficulties, we must ensure that Intel and AMD aren’t tempted to neglect the consumer market in favor of the server sector…
