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- AMD’s gaming revenue is down almost 50% from last year at this time.
- Decreasing GPU sales have contributed to this downturn in revenue.
- Reduction in console sales is a major reason for this decrease as well.
As you might have heard in recent reports, AMD is going through a bit of a turbulent time in terms of its gaming revenue. AMD has revealed that its gaming revenue in Q1 of 2024 is down almost 50% year over year, which sounds like a lot.
The actual figure is $922 million after its 48% decrease, which is certainly nothing to scoff at. However, it is a steep fall from its Q1 2023 revenue in that sector, which stood at around $1.8 billion at that time.
So why exactly is AMD facing such a steep fall in its gaming revenue? Are people moving away from AMD? Is this in any way attributable to Intel’s new foray into the desktop GPU space? Well, not exactly.
Why AMD’s Gaming Revenue Is Declining
Reduced AMD GPU Sales
One of the major components that contributed to AMD’s dwindling revenue is the reduced demand for AMD graphics cards. We have seen a dip in AMD graphics card sales in this latest Radeon generation, and that can be attributed to a few different factors.
While the graphics cards themselves have been mostly fine (barring a few misses that should certainly be avoided) it is just the natural decrease in sales you expect from a graphics card generation in its second year.
The luster and shiny paint job of the Radeon RX 7000 series GPUs have certainly worn off, and AMD’s offered discounts on older GPUs, such as the Radeon RX 7900 XTX, haven’t been able to keep the market captivated.
See, the AMD Radeon RX 7000 series was launched back in December of 2022, so naturally the revenue from that series of GPUs would be highest in the first quarter of the subsequent year, 2023.
While yes AMD hasn’t done a whole lot to bolster its GPU division in the last year or so, the decreasing gaming revenue from this segment is certainly to be expected and may even continue further down the line in 2024.
Decreasing Console Sales
AMD’s own explanation of the decreased revenue says that the company experienced a reduction in “semi-custom SoC” sales, which is basically tech talk for the processors and GPUs that AMD provides for the current generation of consoles.
The PlayStation 5 and the Xbox Series X/S both use custom processors and GPUs based on the AMD Zen 2 and RDNA 2 architectures, so it makes sense that console sales have a direct link to AMD’s gaming revenue.
Both the PS5 and the Xbox Series have entered the latter half of their production cycles, which naturally means that their production and demand have slowed down in 2024.
Although AMD has already made a decent chunk of change from these consoles (the PS5 reached the 50 million sales landmark just last year) the gaming revenue of the company is expected to be on the downward slope until there are any major refreshes in the console landscape.
Future Outlook
It is not all doom and gloom for AMD, however, as this decrease in gaming revenue is pretty easily explained by the natural downturn in GPU sales as well as console demand. The company took a hiatus year and did not introduce a new graphics card generation in 2023, so naturally we can expect the Radeon RX 8000 series graphics cards to be unveiled soon.
Of course, that would only solve half of the problem. While a new GPU generation will help bolster sales for the desktop division of Radeon, that does not help with the dwindling console revenue.
The PS5 Pro is rumored to be coming out pretty soon, but that is not really expected to make a huge difference to the revenue since it is a half-gen upgrade. It will help decrease the losses just enough to hold on till the PlayStation 6 or the next Xbox comes around.
AMD is also pretty optimistic about its new lineup of Strix Halo laptop CPUs, which are expected to be launched in the second half of this year. It is aimed at the premium segment of the market, so maybe AMD can recuperate some of their lost revenue with that addition.
Is AMD Struggling?
Despite what the huge 50% number and sensational headlines may lead you to believe, AMD is not, in fact, in trouble. Yeah yeah, you can breathe easy now AMD fans, there is no Red Alert in the AMD headquarters.
This reduction in revenue is quite in line with what a company of this magnitude expects from a year with no product launches and an overall decrease in demands all across their product range.
With a fresh new GPU generation and maybe a decent half-gen console launch, you’re gonna see these numbers skyrocket in the next year or so.
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[Reviews Specialist]
Usman Saleem brings 8+ years of comprehensive PC hardware expertise to the table. His journey in the tech world has involved in-depth tech analysis and insightful PC hardware reviews, perfecting over 6+ years of dedicated work. Usman’s commitment to staying authentic and relevant in the field is underscored by many professional certifications, including a recent one in Google IT Support Specialization.
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