AMD Says It Isn’t Trying to Keep CPU and GPU Prices High

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Image: AMD

During her company’s Q4 2022 earnings call, AMD Chair and CEO Dr. Lisa Su revealed that red team had been undershipping its products in recent quarters, leading various publications to print headlines that implied the company was intentionally keeping the prices of Ryzen CPUs and Radeon GPUs high as part of its effort to balance out demand. Drew Prairie, AMD’s VP of communications, has now defended the company, calling those headlines inaccurate and explaining that AMD isn’t shipping as many products simply because there’s too much inventory on the market right now. NVIDIA appears to be doing something similar, with CFO Colette Kress telling investors last year that it was “undershipping gaming” to “correct that inventory that is out in the channel.”

From a PCWorld report:

Update: Drew Prairie, AMD’s VP of communications, reached out with the following clarification: “We are shipping below consumption because there is too much inventory in the channel and that partners want to carry lower levels of inventory based on the demand they are seeing and their expectations for their business…the idea we are doing this to keep prices “elevated” isn’t accurate. Our client ASP was flat year over year, and that is due to mix of CPUs shipped.”

This article originally published with the headline “AMD is ‘undershipping’ chips to keep CPU, GPU prices elevated” but it has been updated to reflect AMD’s clarification.

From a SeekingAlpha transcript of AMD’s Q4 2022 Earnings Call (alternate link):

Lisa Su

[…] We do believe the first quarter is the bottom for our PC market – for our PC business, and we’ll see some growth in the second quarter and then a seasonally higher second half. In terms of the under shipment, I mean, I think we’re – we undershipped in Q3, we undershipped in Q4. We will undership, to a lesser extent, in Q1. So I think you can infer that from our guidance single-digit down.

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Tsing Mui
News poster at The FPS Review.

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