Sales of AMD chips are terrible. And it will only get worse
It looks like the coming months will belong to NVIDIA. AMD officially talks about the bad situation on the graphics chip market, which is only going to get worse.
There are three big players in the graphics chip market – AMD, Intel and NVIDIA. The Blues have the least and the shortest experience, so the main fight is between the Reds and the Greens. However, the latest data reveals that the company led by Lisa Su is not doing well when it comes to GPUs.
We will not see new consoles and graphics cards this year
During a conference call with analysts and investors, AMD's CFO, Jean Huinformed Fr revenue decline by 48% year-on-year for the gaming division in the first quarter of 2024. The company expects further declines in the second quarter and beyond, a there will be a chance of recovery only in 2025.
AMD Gaming's operating income in the first quarter of this year was “only” $151 million, which is a significant drop from the previous total of $314 million last year. Thus, the shares of this unit compared to the entire company decreased from 18% to 16%.
The main reason is the situation on the console market. Both Sony PlayStation 5 and Microsoft Xbox Series X/S are already five years old. Therefore, demand for them is decreasing and manufacturers have reduced orders for SoC systems. But AMD Radeon RX 7000 graphics cards are also not popular.
Moreover, AMD's forecasts of further declines suggest that either This year we will not see refreshed Sony and Microsoft consoles or AMD Radeon RX 8000 systemsor their circulation will be so small that it will not have a major impact on the Reds' financial situation.
