Asian media report unanimously that AMD will significantly increase the prices of the acquired company Xilinx. In the best case, there is 8 percent, but certain product groups should be 25 percent more expensive.
AMD wants to recoup the increased costs and investments in a stable supply chain, the group emphasizes in a letter. The price increases will be applied to all affected products from January 9, 2023, including those already ordered and entered in the backlog, but customers will have to wait for this due to the long delivery time.
Virtually all of Xilinx’s product ranges are increasing in price, with the exception of their most advanced solution based on a 7nm process. Here, the price should have been set accordingly higher from the start, the greatest scarcity and highest price spiral has been more prevalent in the 28nm to 45nm range lately. Ultimately, the 25 percent additional costs apply here, while at the bottom “only” is 8 percent.
Its impact on the mature processes, as the industry’s legacy manufacturing solutions are referred to, is nothing new. This is exactly where countless car manufacturers are hunting for chips, but production capacities in this area have not been expanded or hardly expanded for years. That is currently changing, even industry giants like TSMC are explicitly building new factories just for 28 nm chips, one of which is even coming to Germany.
Xilinx cost AMD nearly $50 billion (in stocks)
In the end, the acquisition of Xilinx cost AMD not only the previously predicted $35 billion, but almost $50 billion. However, the new branch of the company shows a stable economic situation and provided a convincing picture in the latest quarterly figures, although the integration into AMD costs money in addition to operational management with a profit. In 2023, there should be the first products that combine the know-how of both divisions.