The Squeeze Tightens
Server CPU supply constraints are now official, according to Omdia's latest datacenter market snapshot. The firm projects 11-15% price increases this year, driven by what it calls "complex and time consuming" challenges in shifting production volume across different process nodes.
The timing is brutal. This lands on top of a memory shortage that's already pushing DDR5 64GB RDIMM costs toward double their early 2025 prices. DRAM is forecast to nearly double this quarter, NAND flash up 30%+. What analysts initially framed as temporary allocation issues now looks structural: data centers will consume 70% of all high-end memory chips manufactured in 2026, per IDC.
Why This Is Happening
The CPU constraint stems from simultaneous production across 3nm and 5nm nodes as vendor roadmaps have broadened. Lower-than-expected yields compound the problem. Unlike memory, where manufacturers deliberately shifted capacity toward high-margin HBM for AI accelerators, the CPU shortage appears more operational than strategic.
Omdia notes hyperscalers will largely dodge CPU price increases through existing long-term agreements. Everyone else pays full freight.
The Trade-Offs
Despite dual shortages, Omdia still projects 12% server shipment growth in 2026, driven by a general-purpose refresh cycle. The firm views memory availability as the bigger risk to datacenter project timelines than CPUs.
For AI infrastructure specifically: at least 71,000 racks shipping with 100kW+ IT load this year, up 56% in 2027. Nvidia's NVL72 integrated systems are the primary driver.
What This Means In Practice
Enterprise procurement teams face a compounding cost structure. Server builds now carry premium pricing on both processors and memory, with allocation challenges on the memory side. The CPU shortage adds 11-15% to an already inflated baseline.
Sourcing experts we've spoken with are advising clients to lock allocations now. New manufacturing capacity won't meaningfully impact supply until 2028, meaning these constraints persist through 2027. The question isn't whether to pay more, it's how much runway your capital budget has.
Notably, this could accelerate cloud migration for workloads where on-premises economics were marginal. Hyperscalers with locked pricing have a structural advantage that mid-market enterprises buying servers on the spot market don't.