AMD Zen 3 Ryzen 5000

AMD Says GPU and Gaming Demand is “Weak” as Company Reports Decline in Revenue

AMD has shared its Q1 earnings. The company reported an increase in revenue across its AI-powered data centers but the company’s Radeon and Gaming divisions have reported major losses. With that being said, the company has reported a year-on-year increase to $5.5 billion mainly driven by its “Data Center” division.

Outside of the AI growth, AMD hasn’t done all too well this year. The company’s gaming division saw a massive decline of 48% year-over-over. Various factors are involved which contribute to this drop. The gaming division covers AMD’s PlayStation and Xbox console hardware and Radeon and SoC Ryzen chips.

The reported decline has a lot to do with the current state of console gaming. Xbox hardware sales, in particular, are to blame here. Microsoft reported a 31% decrease in Xbox sales year-over-year last week. However, AMD says lower Radeon GPU sales have also hit the company hard.

While PS5 consoles are still selling, sales are slower than ever given the current age of the console. Not to mention, AMD Radeon cards struggle in the market too given NVIDIA’s dominance.

AMD is still working on various future tech which will hopefully help drive revenue to the company. The PS5 Pro is expected to launch at the end of the year which is powered by AMD. The company is also working on the next-gen RDNA 4-powered GPU lineup – another range expected in late 2024.

AMD Chair and CEO Dr. Lisa Su says it is an exciting time for the gaming industry as the company is about to deploy new hardware and drive AS development across the board. However, Su also says gaming and GPU demand has been weak.

“We delivered strong first quarter results with our Data Center and Client segments each growing more than 80% year-over-year driven by the ramp of MI300 AI accelerator shipments and the adoption of our Ryzen and EPYC processors. This is an incredibly exciting time for the industry as widespread deployment of AI is driving demand for significantly more compute across a broad range of markets. We are executing very well as we ramp our data center business and enable AI capabilities across our product portfolio. If you look at gaming, demand has been quite weak,” Jean Hu added in an analyst call. “That’s well known also [they have] inventory issues. We guided down more than 30% in the first and second quarters, and the second half will be lower than the first half. That is how we are looking for the gaming business this year.

Source: AMD

Marco is the owner and founder of GLITCHED. South Africa’s largest gaming and pop culture website. GLITCHED quickly established itself with tech and gaming enthusiasts with on-point opinions, quick coverage of breaking events and unbiased reviews across its website, social platforms, and YouTube channel.

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