Global Semiconductor Companies to Raise Prices Amid AI Boom

As demand for power management chips and power semiconductors surges due to a boom in artificial intelligence (AI) data center construction, global semiconductor companies are set to raise prices.

According to reports from Chinese media outlet 21st Century Business Herald on June 29, nearly 20 analog and power semiconductor firms worldwide will implement price increases starting July 1. Infineon, a leading global power semiconductor manufacturer based in Germany, has reportedly issued a notice to adjust prices for some of its products, citing rising costs due to increased energy, raw materials, and transportation expenses. This marks the second price adjustment for the company this year.

Chinese companies are also joining the price hike trend. Hongwei Keji announced on June 26 during an investor meeting that it has begun a second round of price increases for products related to IGBTs (Insulated Gate Bipolar Transistors) and MOSFETs (Metal-Oxide-Semiconductor Field-Effect Transistors), following an initial adjustment in March.

Additionally, Huarun Micro has initiated a second price increase after raising prices by 10% across all products in February. Another Chinese power semiconductor firm, Yangjie Technology, plans to adjust prices by 10% to 15% starting July 1.

Specific products, such as power management chips for AI servers and data centers, as well as high-voltage analog chips, are expected to see price increases ranging from 15% to 25%. Chips used for industrial automation and energy storage are projected to rise by 10% to 15%. In contrast, some consumer goods with sufficient inventory may experience limited price increases or maintain existing prices.

This price increase is attributed to a combination of rising demand and escalating production costs. The expansion of AI data center investments has led to increased demand for power management chips and power semiconductors, while costs for wafer foundries, raw materials, and transportation have also risen.

21st Century Business Herald cited industry insiders and securities analysts who predict that the trend of price increases may continue for the foreseeable future due to the interplay between rising demand for AI data centers and increasing costs. They noted that market share is likely to concentrate among integrated device manufacturers (IDMs) that combine design and manufacturing capabilities, as well as leading companies with stable supply chains.

* This article has been translated by AI.