The price increase would reach up to 20% in some segments. Intel anticipated this measure in April.
Intel ‘s processors and other products will see their prices rise later this year due to rising costs, Nikkei Asia said .
The media indicated that the semiconductor giant informed its clients of this measure.
Intel doesn’t just produce processors for consumer computers. The company also sells server processors, Wi-Fi chips, among other products, to which video cards have recently been added under the Intel Arc architecture.
Nikkei Asia said three executives in the industry have reported future price increases.
Why would Intel raise its prices?
Executives said production and material costs have risen amid inflation being felt around the world. In June alone, inflation of 9.1% has been reported in the United States.
According to Nikkei Asia , these costs would range from single digits to 20%, depending on the product.
Intel came to come this situation
At Intel ‘s shareholder and analyst conference in April, CEO Pat Gelsinger hinted that the company would seek to raise prices.
Gelsinger spoke of “rescaling products to higher price points.” At the same meeting, CFO Dave Zimmer pointed to “increasing specific prices in certain segments.”
Intel has contacted Nikkei Asia for clarification. “In the first quarter financial results call, Intel indicated that it would increase its prices in certain segments of its business due to inflationary pressures. The company has started informing its customers of these changes.”
We will surely know more details about this strategy in the call with Intel shareholders and investors to present the results of the second quarter to be held on July 28.
It’s not just Intel
Giant Taiwan Semiconductor Manufacturing Co. (TSMC) is the world’s largest contract chipmaker. This company has already warned its customers that it would raise its prices by “one digit” percentage from 2023.
Other companies have joined. The Chinese Semiconductor Manufacturing International announced that it was evaluating the price increase for its services after the increase in the price of its inputs affected its net income by 10%.
While there is less demand for electronics amid a possible global recession, it looks like chips will inevitably go up in price.