Intel & AMD are facing severe shortages of CPUs, prompting a global disruption in PC and industrial segments, driving costs further up.
Intel & AMD CPU Prices Surged By 15% As Supply, Not Prices, Led To Severe Shortages
Currently, the global CPU market is witnessing massive shortages. We have already shared how CPUs are the next component that will be affected by the Agentic AI frenzy. The relation between enterprise and client processor shortages is very simple. AI is the bigger market now, and production lines need to be prioritized to keep up with the demand.
Hyperscalers and cloud providers have already run out of CPUs to sell to AI firms, leading to much higher demand than originally anticipated. And unlike memory, which is available in limited quantities but at much higher prices, processors aren't even available at all. This poses a big threat to PC businesses & industrial applications.
Both AMD and Intel have witnessed a 10-15% bump in prices recently. We have seen unreleased CPUs being listed for 10-15% higher prices than their original MSRPs. AMD's Ryzen 9 9950X3D2 is priced at $899, while Amazon is listing it at $999. Meanwhile, Intel's latest Core Ultra 200S Plus CPUs were also listed at higher prices than their MSRPs.
According to Digitimes, Intel's and its partners' survival now hinges on the 18A process node. The 18A technology has just seen the rollout of its first client processor lineups, called Panther Lake and Wildcat Lake. While Panther Lake aims for the premium segment, Wildcat Lake aims for entry-level PCs. But we didn't see many Wildcat Lake laptops listed during yesterday's launch, and even Panther Lake laptops are priced relatively higher (a combination of higher memory prices and processor shortages is to blame).
Even the price drops after Google's TurboQuant announcement are believed to be short-lived as the algorithm is still in a conceptual phase, and while it has shown promises, like driving down memory usage significantly, it's still not within the reach of an average PC user, and while the 30% drop in price was nice, the memory demand remains sky high.
A global CPU shortage is disrupting PC and industrial-computing supply chains, as processors are out of stock even at premium prices, while memory is limited but purchasable. The scarcity threatens notebook and industrial PC availability worldwide and may persist for some time until Intel's 18A process yields improve, industry sources warn.
Both Intel and AMD raised processor prices by 10-15% recently to reflect rising costs. Notebook supply chain representatives, however, reported no immediate expectation of further increases because product availability, rather than price, is the primary constraint. The most scarce parts are Intel's 2022 Raptor Lake series, and one source said lead times have become meaningless because waiting does not guarantee delivery.
It is said that the parts worst affected by the shortages are Intel's Raptor Lake series, which was released back in 2022, but has been the best value so far. Intel has already stated that Raptor Lake is a major part of its desktop business and is expected to release a refresh. With Panther Lake out of reach and Raptor Lake being short, Intel is prioritizing its Arrow Lake as the main processor family for PC and industrial markets.
AMD and Intel also rely heavily on TSMC for their PC CPUs. Panther Lake is based on 18A, but also uses several other modules that come from TSMC. Wildcat Lake also features a mix of 18A + TSMC solution. So until or unless 18A yields improve, the situation for Intel isn't going to get any better.
But there's another issue with Intel relying on older lines. This will lead PC buyers to jump ship to AMD's Ryzen platform, which has been doing relatively well. However, sales of both Intel and AMD platforms are slowing down, and with memory prices + shortages worsening, many vendors will have to adjust their inventory.
News Source: @jukan05
About the author: A Software Engineer by training and a PC enthusiast by passion, Hassan Mujtaba serves as Wccftech's Senior Editor for hardware section. With years of experience in the industry, he specializes in deep-dive technical analysis of next-generation CPU and GPU architectures, motherboards, and cooling solutions. His work involves not only breaking news on upcoming technologies but also extensive hands-on reviews and benchmarking.
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