Chip Shortages Will Extend to 2022 According to AMD CEO Dr. Lisa Su

AMD’s CEO Dr. Lisa Su in a recent interview at the CNBC Code Conference briefly talked about the state of global chip supply. CEO Lisa Su expects supply constraints to last till 2022, with the first half of the year being particularly ‘tight’.

Industry experts have echoed similar expectations and there’s a wide consensus on the 2022 mark.

Chipmakers are still catching up to demand following severe supply chain bottlenecks created by the pandemic. But manufacturing plants that were planned last year will likely start producing chips in the coming months, helping to alleviate shortages for PC parts and other microchips.

– AMD CEO Dr. Lisa Su (CNBC)

Recently a lot of news has come out on increased investment from companies to build fabs. Unfortunately, most of it won’t help alleviate the ongoing crisis, as construction of a new fab takes upwards of two years.

AMD, unlike Intel, doesn’t own chip fabrication plants and outsource the production part to other fabs. This exposes the company to a greater risk arising from supply uncertainty.

“There is some compute that we’re leaving underserviced. So I would say particularly, if you look at some of the segments in the PC market, sort of the lower end of the PC market. We have prioritized some of the higher-end commercial SKUs [Stock Keeping Units] and gaming SKUs and those kinds of things.”

– AMD CEO Dr. Lisa Su (PCMag)

This is also a reason why AMD has put more focus on their premium segment products recently, like the Ryzen series processors and onwards. Margins on low-end products are thin, and with increased production costs, it becomes more difficult to price them competitively. The more expensive products can absorb these increased production costs to an extent and are also more profitable on a per-unit basis.

This is also not the first time the industry is facing such supply issues, but this has lasted the longest and it looks like it is here to stay at least until the end of next year. Previous shortages have been attributed to mining booms and factory fires, but this time these issues affect a wider range of industries like Automobiles, and are driven by a host of complex factors.

Indranil Chowdhury
Indranil is a Med school student and an avid gamer. He puts his absolute faith in Lord Gaben and loves to write. Crazy about the Witcher lore, he plays soccer too. When not playing games or writing, you can find him on 9gag spreading the Pcmasterrace propaganda.