Intel surprised with weak AI PC demand, results in increased Raptor Lake CPU demand

In what comes as absolutely no surprise, Intel has said that its ai PC processors aren't selling anywhere near the numbers they were expecting, creating a shortage of production capacity for older CPUs.

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Intel says that customers are buying less expensive, previous-generation Raptor Lake CPUs instead of the new AI PC-ready Meteor Lake and Lunar Lake processors inside of new laptops. During its recent earnings call, Intel said that it is currently facing production capacity issues for its in-house Intel 7 process node, and that it expects this shorage to "persist for the forseeable future".

Intel's current-generation processors are fabbed using newer process nodes from TSMC, and not using the older-gen Intel 7 process node, so the unexpected surge in demand in the lower-end, non-AI PC-based processors (Raptor Lake) is a strange problem for Intel to have, considering the insane marketing push for AI PC over the last 12+ months.

Intel's Michelle Johnston Holthaus, said: "What we're really seeing is much greater demand from our customers for n-1 and n-2 products so that they can continue to deliver system price points that consumers are really demanding. As we've all talked about, the macroeconomic concerns and tariffs have everybody kind of hedging their bets and what they need to have from an inventory perspective. And Raptor Lake is a great part. Meteor Lake and Lunar Lake are great as well, but come with a much higher cost structure, not only for us, but at the system ASP price points for our OEMs as well".