Intel, AMD Discuss Multi-Year CPU Supply Deals in China Amid Price Surge
Intel and AMD are in discussions with Chinese customers over data center CPU supply agreements longer than one year. Meanwhile, server CPU prices in China continue to climb, with some products seeing monthly increases over 10%.
Chip giants Intel and AMD are negotiating data center CPU supply agreements exceeding one year with Chinese clients, according to two sources familiar with the matter cited by Reuters. These deals typically lock in purchase volumes but not prices, and are primarily structured as one-year contracts.
Concurrently, server CPU prices in the Chinese market are experiencing a significant surge. Some product categories have seen month-over-month price increases surpassing 10%, with certain items accumulating over 40% in price hikes since the beginning of the year. This trend is driven by the escalating demand for artificial intelligence (AI) applications.
The supply chain strain, initially concentrated on GPUs, AI ASICs, and DRAM memory, is now broadening to include other components like CPUs. This wider shortage is pushing companies to consider longer-term commitments to secure critical hardware.
Both Intel and AMD are key providers of CPUs for data centers, and China represents a substantial market for these essential components. The move towards longer-term agreements signals a strategic response to growing demand and potential supply chain volatility.