Amid rising competitive pressure from AMD’s soon to be available Ryzen 3000 processor family, Intel may respond by slashing the prices on its 8th-Generation and 9th-Generation desktop CPUs by as much as 15%. Though unconfirmed, a report from DigiTimes suggests that Intel is looking at a minimum cut in price of 10% to address competition from AMD, an unprecedented move given Intel’s historic reluctance to compete on price.
If accurate, the Intel Core i9-9900K processor, which is found on many high-end gaming PCs, could see a $75 price drop. Recent speculation about a price cut is not the first time that we’re hearing about Intel adjusting its strategy to address competition from rival AMD’s Ryzen lineup. Last month during Intel’s Investor Day, the company told analysts that it was lowering its gross margins estimates for the year, suggesting that a price drop may be in order. Intel blamed stiffer competition and the costs related to its transition to the 10nm and 7nm manufacturing process as reasons for the drop in gross revenue projections.
Intel had also struggled to produce enough its 14nm chipsets in recent past, and the rumored price drop could help Intel sell more silicon to PC partners to alleviate the pent up demand created from prior shortages. Due to those parts shortages, the PC industry is expecting softer sales during the first half of 2019. According to the publication, Intel’s partners are already aware of the price drops, but it’s still unclear if consumer pricing will also reflect the new chip cost.
Historically, AMD mainly competed against Intel on price, but the new Zen 2-based Ryzen chips also come with technological advancements not found on Intel’s latest 10th-Generation Ice Lake processors. AMD beat out Intel to reach 7nm for Ryzen’s architecture, and the new processors will also support the faster PCI Express 4 standard whereas Intel is still relying on PCIe 3. Both Intel and AMD claim that the latest announced processors deliver at least a 15% instructions per clock (IPC) improvement over the respective prior models. AMD’s 7nm-based Ryzen processor will start shipping on July 7. The Ryzen 7 3700X starts at $329.
In response to the DigiTimes report, Intel responded to PC Perspective‘s inquiry stating that it “does not comment on rumors or speculations” as part of company policy.
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