Intel and AMD are cautioning customers in China about tightening server CPU supplies as demand rises and logistics strain the data center market. According to Reuters, average prices for Intel server processors in China have increased by more than 10%, depending on contract terms, while delivery times for some Xeon models have extended to as much as six months. The most acute shortages affect Intel’s fourth and fifth-generation Xeon processors, where backlogs are reportedly growing rapidly, signaling significant constraints for operators upgrading or expanding their compute capacity.
AMD is experiencing similar, though less severe, supply pressure in China. Some server CPU orders are now quoted at eight to ten weeks for delivery, which marks a noticeable lengthening of lead times for buyers planning new deployments. China remains a major market for both Intel and AMD, accounting for over 20% of Intel’s total revenue, and includes large server OEMs and major cloud operators such as Alibaba and Tencent. The supply crunch is being driven by a mix of factors, including surging demand tied to Artificial Intelligence infrastructure and so-called ‘agentic Artificial Intelligence’ systems, which significantly increase CPU requirements alongside GPUs as cloud providers and enterprises scale advanced workloads.
Manufacturing and capacity limits are further tightening availability. Intel has acknowledged supply issues linked to manufacturing and yield problems, constraining output of its latest server chips. AMD, which depends on TSMC as its foundry partner, is feeling the impact of TSMC giving priority to high-profit Artificial Intelligence chips over general-purpose server CPUs. Rising memory costs in China have added more pressure, with buyers rushing to secure CPUs now to avoid paying more for complete systems later as component prices climb. Both chipmakers say they are working to improve supply, with Intel telling Reuters its inventory hit a low point in Q1 but that it expects gradual improvement through 2026, while AMD stated it remains confident in its ability to meet demand based on supplier agreements and its partnership with TSMC. For the near term, however, customers are likely to face higher prices and longer waits for server CPU deliveries.
