Analyst Report Reveals Price Hike for 3rd Gen AMD EPYC Processor and Delay for Intel Sapphire Rapids Xeon Chips
Inspur Systems is one of the largest server vendors in the world. A report from Mizuho Securities managing director Jordan Klein recently revealed that Dolly Wu, vice president and general manager of data center/cloud at Inspur Systems, expects AMD to raise the prices of its data center processors. Reports continue to show that Intel’s Sapphire Rapids Scalable processors will experience release delays until Q3 2022.
AMD plans to increase EPYC data center processor costs, increasing another 10-30%. Due to the current shortage of chips around the world, this comes as no surprise to consumers. When the website Tom’s gear contacted AMD for comment, the company declined for two reasons: AMD and other notable companies never discussed pricing, including changes due to market stability. Second, AMD is coming to its fourth quarter earnings report. They continue to remain silent so as not to disclose any gains or losses to the general public or their competitors.
On the Intel front, the report shows that Intel is to revamp the launch of its next-gen Sapphire Rapids processors for the second time, with an expectation for the third quarter of this year.
The Inspur Systems report shows AMD’s pricing will vary by customer, but customers using large cloud systems will see less of an increase than other markets. Also missing is a notification of when more processors will be available, but AMD customers are waiting and accepting the increased cost.
AMD Milan, the codename for AMD’s EPYC 7003 series of high-performance microprocessors inspired by the Zen 3 microarchitecture for single- and dual-socket server platforms, delivers exceptional performance, especially on a per-watt basis in data centers. With its increased core count, AMD Milan delivers ultimate gig density to enable data centers to receive high levels of performance with lower operating costs.
AMD’s price changes are unsurprising given ongoing shortages seen around the world, primarily when the company relies on lithographic wafers and outsourced semiconductor assembly and testing (OSAT), a third-party service. consisting of the assembly, packaging and testing of integrated circuit semiconductors. . The OSAT services are perhaps the biggest blow to the industry and the most far-reaching effect on AMD. Rising manufacturing costs affect all levels of the supply chain, which reflects AMD’s choice to increase prices for its customers and does not indicate cost increases solely for profit.
The report further reveals that Intel Ice Lake production has increased, showing an estimated 50% increase in supply each year from 2022. Intel is not raising the prices of its processors, which hurts the AMD’s future market share. The report includes the delayed launch of Sapphire Rapids, the company’s 7nm technology chipset, which appeared last year during the second quarter. There is no appearance that the Sapphire Rapids processor launch delays will affect Intel due to the company’s higher BOM pricing, as the materials cost the company more.
Team Blue’s Sapphire Rapids processor is the company’s scalable 7nm chipset architecture using Intel’s EMIB. This solution combines both the substrate and the interposer, linking the two together. The process uses a small section of silicon. It embeds the zone directly into the substrate, providing higher throughput and latency compared to other OSAT services and increasing the cost of the end result. Even though Intel does its own packaging, with the loss of materials at its disposal, the price has increased overall.
Inspur Systems Dolly Wu contradicts Intel CEO Pat Gelsinger’s comments about Sapphire Rapids regarding AMD EPYC. Gelsinger hopes the company will compete head-to-head with AMD EPYC data center processors, but Wu predicts that AMD Milan and its Genoa series will continue to hold the edge over Intel Xeon Scalable processors.
AMD is dependent on silicon supplies, forcing the company to be tighter to grow market share faster. However, Intel also sees challenges with TSMC to continually increase 7nm capabilities and AMD 5nm Genoa chipsets to appear further into 2022. If both companies will be extra aggressive when accessing sockets needed this year.
Source: Tom’s gear