AMD has attracted attention after revealing that it has manipulated the supply of chips downwards and applied a reduction in the processes of manufacturing and distribution of hardware so as not to collapse the prices of its products in the market. Although this may sound scandalous, it has a reason since the PC business is not doing so well.
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AMD manipulates its production and distribution downwards to avoid falling prices
The AMD company presented its financial report and in it it pointed out the measure it had to take in the last fiscal quarters to protect the business of its GPUs and processors, preventing it from going down. According to Lisa Su, the company’s CEO, the PC sector has fallen in the post-pandemic period and there is not much demand for graphics cards and processors. From an ideal user perspective, this would lead to an oversupply of products that would drive down prices, but AMD is avoiding this.
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In this sense, the company accepted that in recent quarters it reduced its supply of chips as well as the units manufactured and distributed, this to allow products that are already on the market to be sold (although the cycle takes longer) and be replaced by the parts that are in the production lines in a similar percentage maintaining a balance, thus avoiding that there is more supply than demand and therefore the price remains high.
Lisa Su assured that this has been the measure that has allowed AMD’s CPU and GPU businesses to stay afloat in this difficult economic period and the short-term plan is to continue on that path, so if you expect the prices go down, it’s time you get used to the idea that it’s not going to happen.
In the case of the GPU sector, it is not going through a good moment after the collapse of the cryptocurrency scene and inflation worldwide. Not as many graphics cards are being bought and AMD’s immediate solution has been to rig it down to avoid a major financial hit.
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