Tech

The price of Intel processors could go up by the end of the year, will other components also go up?

Asian sources assure that Intel has notified its main clients of a future price increase which, in principle, will affect both its general consumer and professional processors, and also its chips for Wi-Fi network solutions and other products focused on connectivity. The source is very reliable, so it has a lot of credibility.

In theory, this price increase is justified by a very marked increase in production costs, which includes not only everything related to the semiconductor manufacturing process, but also the materials used. We don’t have concrete details, so we don’t know by exactly how much prices will rise, but according to the source, we could see anything from a minimal increase to a much larger one of around 10-20 percent.

I am convinced that this possible increase in prices will not affect all products equallyand that in the end it will end adjusting to market reality at the specific moment in which it occurs, and its evolution in the following months. It is important to note that this rise by Intel is something understandable considering the situation of the world economy Today, inflation has been skyrocketing for some time and prices in the United States rose by 9.1% in June, a figure that marks an absolute record in the last 40 years.

All these keys have created “the perfect storm” for an increase in the price of technology in general, and if we add the recent parity between the dollar and the euro, it is evident that the situation in which we find ourselves is not good. This information speaks of a price increase by Intel, it focuses on the chip giant because it is the information they have, but I dare to look further and I think that in the end we will see a rise in prices that will widely affect the technology sectoreven though the semiconductor shortage is almost over.

To understand this better we only have to look at the moves that have been made by firms such as TSMC and SMIC, manufacturers of semiconductors, and the suppliers of materials Shin-Etsu Chemical, Sumco and Showa Denko. The Taiwanese giant told its clients that plans to raise prices at a “single digit” rate from 2023, while SMIC also confirmed in a meeting with investors that it will raise prices for offset the increased cost of materialsotherwise they would reduce their gross margins by 10%.

For their part, Shin-Etsu Chemical, Sumco and Showa Denko are preparing a 20% increase in the price of materialsapproximately, a significant increase that obviously has to be assimilated in some way, either absorbed by the companies to avoid a price increase at the expense of lower profits or passed on to consumers by increasing the sale price of each product.

I wanted to give context to this information because, as we can see, the price increase that is coming is not a whim of Intel, It is a direct consequence of the reality of the market and the economy today. Don’t be surprised if other majors like AMD, NVIDIA, and even Apple end up raising the launch price of their next-gen products.

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