The hardware market across the whole world is not doing too hot right now, at least in terms of availability and prices. Graphics cards are nearly 3 times their original MSRP, and CPUs have not been doing too well either. AMD has admitted recently that they have prioritized high-end chips over any budget offerings due to the global chip shortage, but projects better availability by the end of the year.
Speaking at a recent JPMorgan conference, Lisa Su, the CEO of AMD, reiterated that demand has been exceeding supply due to the shortages at the moment, after being asked whether AMD could be receiving higher profits if capacity was there to facilitate demand. The question then turned towards prioritization:
“There is some compute that we're leaving underserviced,” said Su. “I would say, particularly, if you look at some of the segments in the PC market, sort of the lower end of the PC market, we have prioritized some of the higher-end commercial SKUs and gaming SKUs and those kinds of things.”
When the ongoing COVID-19 pandemic hit, many semiconductor companies saw demand skyrocket, with limitations on those manufacturers themselves due to limited supply. Since then, the global chip shortage has affected nearly every electronics manufacturer across the globe, limiting their options for product releases and reduced availability of said products.
That’s why AMD has remained so quiet during this time, as the company has been focusing on trying to keep stock up rather than announce and release brand new products in a time where it is not only hard to find them but many can’t even afford them. So prioritization becomes a big part of a company’s release structure, and it only makes sense to prioritize the higher-end products which make more profit.
Unfortunately, that doesn’t help us in our case, but it could explain why AMD has yet to release any more chips in the Ryzen 5000 series, especially more budget-friendly options. The same goes for graphics cards, as neither Nvidia or AMD have launched any low-end variants of their most recent GPU stacks.
Thankfully, that means AMD is doing pretty well for itself at the moment despite all that’s going on (their projected year-on-year growth has increased from 37% to 50%), and with the world slowly getting a grip on the COVID-19 pandemic with vaccines and semiconductor manufacturers increasing capacity, AMD is projecting better supply by the end of the year:
“I do believe that you will see more and more capacity come online as we go through the next couple of quarters,” said Lisa Su.
What do you think? Have you been waiting for more budget offerings of PC hardware? Do you think supply will get better by the end of the year? Let us know your thoughts!