Datacentre boom triggers supply crisis across chip sector
Server CPU lead times stretch to six months as Amazon commits over $200 billion to infrastructure buildout, squeezing global semiconductor production
The datacentre expansion race has collided with manufacturing reality. Both AMD and Intel have warned Chinese customers that server processors are in critically short supply, with delivery windows extending up to six months for some Intel chips and two months for AMD's latest server parts, according to a Reuters report Thursday. Intel has simultaneously raised server CPU prices by roughly 10%.
The constraints reflect a broader crunch rippling through semiconductor supply chains as hyperscale cloud providers commit unprecedented capital to AI and compute infrastructure. Amazon disclosed this week it will spend more than $200 billion on datacentre investments in 2026, a jump exceeding 50% from prior guidance.
The spending surge explains mounting pressure across technology suppliers and supports expectations that memory and storage markets will remain tight through the year, according to Wedbush Securities analysts Matt Bryson and Antoine Legault.
AMD emerges with manufacturing advantage over Intel
The supply shortage appears to benefit AMD more directly than its longtime rival. AMD can lean on Taiwan Semiconductor Manufacturing Company's external foundry capacity, while Intel continues wrestling with internal production challenges at its own fabrication plants.
Wedbush analysts believe AMD stands to capture pricing power from the constrained environment, a dynamic not yet reflected in current financial models. The tight CPU market also provides AMD with operational flexibility if its AI-focused products experience slower adoption, since strong traditional server chip sales could sustain datacentre revenue growth through at least 2026.
Reuters reported AMD lead times now range from eight to 10 weeks, while certain Intel orders placed today won't ship until late summer or early fall.
Power semiconductors face similar strain
Datacentre demand is creating bottlenecks beyond processors. Infineon Technologies has informed customers that prices for select power semiconductor products will increase in April, Taiwan-based Technews reported.
The move aligns with recent market chatter suggesting mature process foundries, which produce power management chips, are gaining pricing leverage tied to datacentre infrastructure builds. Wedbush has heard industry reports of certain power components being in short enough supply to delay server production.
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While power-related semiconductors likely are benefiting from tighter conditions, the analysts remain cautious about the broader outlook for mature fabrication facilities and integrated device manufacturers. Reduced production in consumer electronics categories continues to weigh on overall fab utilization rates.
The confluence of surging cloud infrastructure spending and constrained chip manufacturing capacity points to sustained supply-demand imbalances across multiple semiconductor categories well into 2026. Amazon's capex commitment alone, targeting faster growth in core cloud computing services alongside new AI workloads, illustrates why chip suppliers face mounting pressure to increase output even as some manufacturing nodes remain capacity-limited.
