Despite producing some of the best graphics cards available, AMD is facing challenges in sales. According to its financial results for the first quarter of 2024, gaming revenue has declined by 33% compared to the previous quarter and by 48% compared to the same period last year.
During the first quarter, AMD generated $922 million in revenue from its gaming segment, significantly lower than Nvidia’s $2.9 billion reported revenue for its gaming segment. The decrease in revenue is attributed to a drop in semi-custom revenue and reduced sales of AMD Radeon GPUs.
AMD’s dominance in gaming devices outside of PCs, including the PlayStation 5, Xbox Series X, and portable gaming devices like the Asus ROG Ally and Lenovo Legion Go, is also facing challenges as these devices age, impacting AMD’s sales.
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The performance of graphics cards is also impacting sales. The release of the RX 7600 XT earlier this year was met with disappointment, as it failed to meet expectations in terms of performance and value.
In contrast, Nvidia’s release of the RTX 40-series Super refresh at the beginning of the year received positive feedback, offering updates to higher-end models and maintaining price competitiveness. AMD’s lack of a product refresh this year and reliance on discounts for older GPUs like the RX 7900 XT have negatively impacted their graphics business.
Commenting on the revenue decline, Jean Hu, Executive Vice President of AMD, expressed concerns about the gaming business prospects for the second half of the year, anticipating a further decline. Despite this, AMD remains optimistic about the upcoming release of the Strix Halo CPUs, targeting premium segments of the market.
A ray of hope for AMD lies in the upcoming release of the Strix Halo CPUs, slated for the second half of the year. AMD’s CEO Lisa Su believes these products will revolutionize the AI PC market, offering powerful capabilities in a laptop form factor similar to the PlayStation 5.
Rumors surrounding the Strix Halo chips suggest a significant leap in performance, with leaks hinting at PS5-level power in a laptop-sized package. AMD’s commitment to the Strix Halo lineup indicates that official details will be revealed soon, bringing potential success in the gaming market.
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