Cost of living crisis hits CPUs while GPUs see falling prices

All change in the chip market as Intel warns of a potential 20% price hike for some of its CPUs just as the collapse in crypto makes GPUs affordable once more.

The rising costs of shipping and materials has led Intel to warn of a potential 20% price hike for some of its CPUs according to reports in Nikkei Asia. Also impacting on a wide range of other connectivity chips, including WiFi, while the price rises have yet to be finalised they could see some chips increasing in cost by up to as much as 20%.

“On its Q1 earnings call, Intel indicated it would increase pricing in certain segments of its business due to inflationary pressures,” said an Intel spokesperson in a statement to Nikkei. “The company has begun to inform customers of these changes.”

This is undoubtedly going to have an impact on PC prices as the year progresses, though these are already being shaped in turn by what Gartner refers to as the sharpest decline in PC shipments in nine years. Globally, shipments were down 12.6% in the second quarter of this year, while in Europe and the Middle East the figure was even higher at 18%.

The causes of that are a wild concoction of geopolitical instability, supply chain disruption (overtaking component shortages as the main driver), general inflationary pressure, and a steep downturn in the demand for Chromebooks in particular. 

It’s a confusing picture. On the one hand, inflation is causing PC manufacturers to have to raise prices, on the other increased stock levels will tend to drive down prices as retailers look to shift units. But, one thing we do know is that GPUs are finally coming down as the bottom drops out of the crypto market.

Bitcoin is currently a third of a value of its November 2021 peak, and the rest of the magic beans sector has seen similar reverses. As The Verge notes, that has led to crypto miners both dumping GPU cards onto the market and new ones actually making it to the shelves; Nvidia has started bundling free games with some cards to shore up demand, and some retailers are even implementing price drops for some RTX 3080 cards.

The situation is, as ever fluid, and we have plenty of new tech on the way from both Nvidia and Intel which will change things again. But the chances are both that a) if you’re planning on building your own machine now is a good time and b) come the 2022 holiday season what is available to buy might well cost more.