Intel (INTC) and AMD (AMD) have reportedly notified Chinese customers of supply shortages for server central processing units (CPUs), with Intel (INTC) warning of delivery lead times of up to six months.
The supply constraints have driven up prices for Intel’s server products in China by more than 10% generally, although pricing varies by customer contract, Reuters reported.
These latest notices to Chinese customers, which the sources said were made in recent weeks, indicate that CPU shortages have also intensified. That could compound challenges for AI companies as well as many other manufacturers.
In China, which accounts for more than 20% of Intel’s overall revenue, its fourth- and fifth-generation Xeon CPUs are in particularly short supply, with Intel rationing deliveries, the report added.
Meanwhile, AMD (AMD) is also said to have informed clients of supply constraints. Delivery lead times for some AMD products have been pushed out to eight to 10 weeks.
Intel, which flagged CPU supply constraints in its earnings call in January, said in a statement to Reuters that the rapid adoption of AI had led to strong demand for “traditional compute”.
The company expects “inventory at lowest level in Q1, but we are addressing aggressively and expect supply improvement in Q2 through 2026,” the statement said.