AMD CPU Sales Rise As Intel Shortages Make OEMS Unhappy

/ 4 years ago


AMD Benefitting From Intel Shortage

Over the past month or so, Intel has been struggling with a looming CPU shortage. Due to the demands placed on their 14nm process, supply has not been keeping up. As expected, these shortages have pushed the prices for the chips way up due to supply and demand. After high prices for a month or so, we are starting to see signs of the ripple effects in the market. For one, AMD chip sales are increasing while OEMs are growing unhappy about the shortages.

The first part of the story makes a lot of sense as the Intel CPUs go up in price. AMD is currently the most competitive they have been in a decade in terms of performance. With such a small performance margin, AMD CPUs at stable prices are more competitive for uninitiated buyers. Fence sitters are also more likely to choose AMD for cost benefit. Furthermore, even those who might want to buy Intel might hold out for lower prices, pushing sales down.

OEMs Unhappy With Intel Supply Woes

OEMs are also unhappy about the shortage and higher prices. While they are less likely to be affected by costs due to long-term supply agreements, supply shortages will hit their lineups as well. The shortages and changing roadmaps also mean that product planning is out the window. To combat this, some OEMs, like HP, are pushing out more AMD builds. HP expects to ship 1/3 of their PC units as AMD ones. Analysts expect the shortage to last until Q2 2019.

Due to these problems facing  Intel, AMD has been reaping a lot of benefits. Sales are expected to accelerate as the shortage continues to grow. Some analysts are even predicting 30% market share for AMD by the end of the year. The only unknown is how well Intel has been able to protect the enterprise market from the shortage. If AMD can get in now, they will be able to build a lot of momentum going forward. Based on this information, other analysts are predicting even higher prices for AMD stock.

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