Console Gaming Demand Has Declined A lot, Says AMD

Expert Verified By

AMD Gaming Revenue Down By 48%!

Story Highlight
  • AMD has just revealed that gaming revenue in Q1 2024 is down almost 50% YoY.
  • It states that this primarily due to decreased demand for consoles like the PS5 and Xbox Series S|X, in addition to gaming graphics cards.
  • AMD does not expect demand to improve in the near future.

The gaming industry has faced challenges in recent years, with concerns arising over a perceived decline in player engagement due to games prioritizing monetization over entertainment and encountering technical issues.

The impact of such events appears to have reverberated throughout the gaming industry, as evidenced by AMD’s CFO, Jean Hu, disclosing a significant downturn in gaming demand during the Q1 2024 earnings call.

She states that demand will continue to get worse.

Why it matters: The substantial decline in gaming demand is indicative of underlying issues within the industry that must be addressed. Failure to fix these issues could potentially result in significant challenges moving forward.

AMD Q1 2024 Performance
AMD Q1 2024 Performance

According to the CFO, gaming hardware is no longer as sought after. She also states that demand will only worsen, with the second quarter expected to be even worse than Q1.

Demand has been quite weak. Also [they have] inventory issues.

-Jean Hu

CEO Lisa Su supported this assertion, revealing that gaming revenue for AMD in Q1 had declined by 48% compared to the same period last year. Moreover, it experienced a 33% decrease compared to the previous quarter, resulting in revenue of $922 million.

Gaming operating income was also down 52% year over year. The decrease in gaming revenue is attributed to lower semi-custom revenue and reduced sales of AMD Radeon GPUs, while the decline in operating income is attributed to lower revenue.

Su also noted that first-quarter semi-custom SoC (System-on-Chip) sales declined in line with their projections as consoles entered the latter half of their cycle. She described it as a significant decline that aligns with the typical pattern observed in the console cycle.

The gaming giant supplies hardware to the PS5 and Xbox Series S|X. The former was setting new records last year, reaching 50 million units sold. While the latter’s sales were already slow in 2023, it seems both console giants will suffer worse sales by the end of 2024.

Overall, AMD’s revenue was still up by 2% YoY.

AMD began the year on a strong note but has been impacted by the decline in gaming demand, affecting its performance.

While the technical aspects have certainly contributed to the decline, several other factors have also played significant roles in this downturn.

The gaming industry’s current state has been a topic of discussion, with observations indicating that many developers prioritize profit over crafting games that lead to less consumer interest. Such acts have led to lower trust amongst gamers, resulting in lower revenue.

Was our article helpful? 👨‍💻

Thank you! Please share your positive feedback. 🔋

How could we improve this post? Please Help us. 😔

Gear Up For Latest News

Get exclusive gaming & tech news before it drops. Sign up today!

Join Our Community

Still having issues? Join the Tech4Gamers Forum for expert help and community support!

Latest News

Join Our Community

104,000FansLike
32,122FollowersFollow

Trending

Black Ops 7 Beta Struggles on Steam – Player Count Nearly 5x Lower Than Battlefield 6 Beta

According to SteamDB, Black Ops 7 beta player count only topped at about 100K players, compared to Battlefield 6 beta's over 500K.

Activision Claims 97% Of Black Ops 7 Cheaters Are Banned Within 30 Minutes

97% of Call of Duty: Black Ops 7 cheaters were banned within 30 minutes of signing in, while only 1% made it into the game.

Silent Hill 3 Remake Reportedly Coming in 2028 as Bloober Team Works on Resident Evil-Inspired New IP

Bloober Team is rumored to be working on a Silent Hill 3 remake and a new Resident Evil-inspired IP, with releases expected in 2026 and 2028.

Battlefield 6: EA Promises 120 FPS Performance on Consoles and Free DLC Support

Battlefield 6 to support 120FPS, and alongside, EA to give out a free DLC titled 'Covert Operations' during Season 1.

Microsoft Reportedly Scrapped Its Xbox Handheld After AMD’s Shocking Demands

A new report reveals that the first-party Xbox handheld was cancelled because AMD demanded 10 million sales to develop a custom SoC.