AMD Limits Chip Supply to Maintain High Prices for CPUs and GPUs

Image courtesy: Reuters

The PC industry is struggling and Intel experienced such poor sales last quarter that they had to implement pay cuts and other drastic measures. AMD's client PC sales also declined significantly with a 51% drop year over year, but they still managed to make a small profit. Despite the decrease in demand, CPU and GPU prices have not fallen. During a call with investors, AMD CEO Lisa Su confirmed that the company has been purposely limiting the supply of chips, known as "undershipping", to balance supply and demand and keep prices up. With the decline in demand due to the pandemic and rising inflation, the demand for CPUs, GPUs, and PCs has dropped suddenly. The GPU mining industry has slowed down, causing a surplus of unsold chips, yet older graphics cards are still selling at high prices due to the practice of under-shipping.