The processor market faces unprecedented shortages as demand from AI and consumer segments surges. Prices rise, lead times extend up to a year, and major players like Intel, AMD, and MediaTek scramble to expand production.
© A. Krivonosov
The largest players in the semiconductor market—Intel, AMD, and MediaTek—are aggressively expanding processor production to keep up with surging demand. Yet even these efforts have not stabilized the market: prices keep rising, and lead times for some product categories have stretched to 12 months.
The main pressure driver is the rapid growth of artificial intelligence. Companies are massively buying computing power for AI infrastructure, sharply increasing the need not only for GPUs but also for CPUs. Previously, systems were built with a heavy bias toward graphics accelerators, roughly at an 8:1 ratio. Now that balance is rapidly shifting toward 1:1. This means the load on the processor market has multiplied and continues to grow.
Against this backdrop, Intel has bet on the more profitable server segment, focusing resources on Xeon chips. Demand has been so high that Intel cannot keep up, leading to shortages and driving up prices. Reports even indicate that the company is using reworked dies to boost revenue, highlighting the tense situation.
AMD is taking full advantage, strengthening its position in the server segment and approaching a record market share. The upcoming EPYC Venice processors based on the Zen 6 architecture will add further pressure on Intel. Meanwhile, NVIDIA is developing its own CPU solutions, including the Vera project, to reduce reliance on external suppliers.
In the consumer segment, the situation is far from stable. Laptop and Chromebook manufacturers face serious delivery delays, in some cases up to a year. This has forced them to seek alternative suppliers, and MediaTek is notably strengthening its position, planning to boost shipments by more than 40% this year alone.
Prices continue to climb: Intel processors have gone up by about 20% over the past year, and analysts see no quick reversal. Even expanding production capacity cannot keep pace with demand, and building new factories requires time and huge investments.
In short, the market has reached a point where growing production no longer guarantees falling prices. As the industry adjusts to this new reality, users and companies will have to deal with expensive components, limited availability, and long waits for delivery.