AMD’s Strategy: Keeping GPU Prices Affordable During the Ongoing DRAM Shortage

AMD has articulated ambitious goals in the current turbulent PC market, primarily influenced by a DRAM shortage. The question remains: can the company meet these objectives amid such volatility?

AMD Partners with AICs to Manage GPU Pricing Amid DRAM Shortage

The ongoing DRAM shortage, exacerbated by the recent surge in AI technology demand, has caused GPU prices to spike. While certain manufacturers strive to mitigate the rise in sourcing costs, others have swiftly raised prices to capitalize on market dynamics. This crisis has severely impacted pre-built PCs, laptops, smartphones, and graphics cards, with many brands redirecting their focus to accommodate the burgeoning AI sector.

Recent analyses indicate a significant price increase for next-gen graphics cards from both NVIDIA and AMD. Currently, NVIDIA dominates the mainstream GPU space but is struggling to provide enough GeForce RTX 5070 Ti models, focusing its production on 8 GB variants. Conversely, AMD has offered limited commentary regarding its supply chain and pricing strategies.

We have very strategic partnerships over many, many years with all the DRAM manufacturers to make sure that both the amount of supply that we need and the economics of what we’re able to buy from them are what we can support in our graphics business,

– David McAfee, VP of Ryzen

In a recent discussion with Gizmodo, AMD’s Ryzen VP, David McAfee, revealed insights into the company’s current strategy. He emphasized AMD’s longstanding relationships with major DRAM suppliers to secure necessary components. However, he acknowledged that forecasting the future remains challenging as one of the primary memory manufacturers has withdrawn from the consumer segment, placing AMD in a predicament akin to that of NVIDIA.

Without the memory at the right price, building graphics cards with our add-in-board partners that hit the right price and market, that’s tough math to put together.

So managing that memory ecosystem very closely is absolutely something that is a core part of what we do.

– David McAfee, VP of Ryzen

McAfee reiterated that AMD remains committed to keeping GPU prices as low as possible, working diligently with its board partners to achieve this goal. Nonetheless, he cautioned that sustaining prices at or near the manufacturer’s suggested retail price (MSRP) could prove difficult due to soaring memory costs.

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