AMD’s gaming revenue saw a sharp 48% year-over-year decline in the first quarter of 2024. This significant downturn is attributed to reduced demand for the company’s processors used in Sony and Microsoft consoles, alongside a drop in sales for Radeon discrete graphics cards. With the company’s projections indicating continued declines throughout 2024, many are questioning the future of AMD’s gaming segment and whether we’ll see new Radeon RX 8000-series RDNA 4 GPUs this year.
First-Quarter Decline Signals Trouble
AMD’s gaming revenue dropped from $1.757 billion in Q1 2023 to $922 million in Q1 2024, representing a dramatic 48% year-over-year decrease. The segment’s operating income fell to $151 million, a substantial drop from the $314 million earned in the same period last year. These numbers suggest a troubling trend for AMD’s gaming business, with the company’s Chief Financial Officer, Jean Hu, acknowledging on a conference call with analysts that gaming graphics and semi-custom SoC sales were down considerably.
Consoles and GPUs Contribute to the Decline
The decline in AMD’s gaming revenue is partially due to a decrease in sales of processors for Sony’s PlayStation 5 and Microsoft’s Xbox Series X|S consoles, which are now in their fifth year. With fewer consoles being sold, AMD’s gaming revenue takes a hit. Additionally, AMD’s discrete GPU sales suffered, as the company’s market share in desktop GPUs fell in Q1 2024, despite modest gains in Q4 2023.
No RX 8000-Series on the Horizon?
With AMD’s bleak projections for the rest of 2024 and further into 2025, there’s growing speculation that the anticipated Radeon RX 8000-series RDNA 4 GPUs may not arrive this year. Although AMD has not officially confirmed any delays, it’s increasingly likely that the company will push the launch of these new GPUs into 2025, given the sluggish sales and waning demand for high-end gaming hardware.
What’s Next for AMD?
The uncertain future of AMD’s gaming business suggests a challenging road ahead. While the company is introducing new driver-based technologies like AMD Fluid Motion Frames to boost performance, it’s unclear whether these initiatives will be enough to offset the broader downturn in gaming revenue. If AMD decides to focus on mainstream and budget markets, it could further cede the high-end GPU market to competitors like Nvidia. Time will tell if AMD’s strategy can turn the tide, but for now, a recovery seems far off.
Source https://www.tomshardware.com/pc-components/gpus/amds-gaming-revenue-nosedives-48-not-expected-to-recover-until-2025