AI Demand Still Hot, Chip Leaders Say Supply Is the Real Problem

Recent chip stock ups and downs have sparked talk about whether AI demand is cooling. But several AI industry leaders say demand is still strong, not slowing down. Pat Gelsinger, former Intel CEO, says AI demand is almost unlimited, and the real limit is energy supply.

Some companies like Meta and xAI are selling or renting out extra computing power, but insiders say these are just isolated cases. The CEO of AI chip company Cerebras Systems says demand for computing power is far greater than supply, and there's still a shortage of data centers and other key resources. Lumentum, a maker of data center communication gear, says its products are already sold out for the next five years.

Companies are moving from blindly using AI to focusing on return on investment. With low-cost open-source models from DeepSeek and Alibaba, businesses are picking different models for different tasks to boost efficiency. Insiders believe this rational approach won't hurt long-term AI demand, but will instead push for more efficient infrastructure.