AMD could increase graphics card prices by 10% due to memory shortage crisis

[midian182]

Ripple effect: It seems fears that the global memory shortage and resulting high prices could impact graphics cards were warranted. After several rumors claiming the company was about to implement a price hike, AMD has reportedly told partners that its GPU prices are going up – for a second time – by 10%.

We've covered several aspects of the memory shortage, including this deep dive into how AI demand is causing the problem and the way it affects GPU pricing.

Now, UDN reports that the situation has led to AMD notifying its partners of a price increase across its entire product line. It's estimated that the hike is at least 10%.

The report adds that Asus, Gigabyte, and PowerColor are just some of the AIB partners that have been notified about the price increases.

This is believed to be the second time that AMD has raised prices. It previously introduced an increase for its industry customers that hasn't affected the retail segment, but this one is expected to impact end-market prices.

AMD took a lot of flak after the Radeon RX 9070 XT's $600 MSRP was deemed a fantasy. The company said it had encouraged board partners to promote MSRP models, but they've only now started appearing around that price. But given the reported price hike, they're unlikely to stay at MSRP for very long.

It's not just AMD feeling the strain. Nvidia is believed to have postponed or even canceled the planned release of the RTX 5000 Super series, which was rumored to pack more VRAM. With GDDR7 prices shooting up, Nvidia would have to price the cards much higher than their non-Super versions, which would cause plenty of outcry.

It was reported last week that both AMD and Nvidia could reduce production of (or even discontinue) their low- to mid-range graphics cards, where memory costs account for a large share of the bill of materials.

As noted in our feature on the issue, recent deals between AI companies and data-center builders have set aggressive timelines to construct gigawatts of data-center capacity in just 2 to 3 years. AI data centers require massive amounts of DRAM to meet the memory needs of modern AI models, especially on GPUs.

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AMD could increase graphics card prices by 10% due to memory shortage crisis

 

[Str8Shot]

Explain why a multi-trillion dollar company, actually, the MOST valuable company in history by market cap, can’t eat a $3 increase in their memory from GDDR6 to 7. A $3 increase will yield a $30 increase for the consumer, if not more.

 

[Puiu]

Explain why a multi-trillion dollar company, actually, the MOST valuable company in history by market cap, can’t eat a $3 increase in their memory from GDDR6 to 7. A $3 increase will yield a $30 increase for the consumer, if not more.

It's a bit more complicated than just the memory chips (memory controller, supply chain changes, stock issues, etc), but I do agree that they're being way too greedy. But it seems GDDR6 is now also being supply constrained because production moved towards AI servers (DDR5, NAND, GDDR7 etc).

 

[NumberNine]

When you say "it begins" what you mean is "it continues".

 

[Joeg1484]

Explain why a multi-trillion dollar company, actually, the MOST valuable company in history by market cap, can’t eat a $3 increase in their memory from GDDR6 to 7. A $3 increase will yield a $30 increase for the consumer, if not more.

I was thinking the same thing... I mean, a 10% increase isnt much for the consumer, so for a large company, you'd think they would just eat it to keep customers happy.

Even with a 10% increase on, say $600, thats what, $60? Who give a ****! I mean, your already spending $600, $60 seems like a state tax :-D or dinner out to have a great GPU LOL!!!

 

[Neatfeatguy]

I was thinking the same thing... I mean, a 10% increase isnt much for the consumer, so for a large company, you'd think they would just eat it to keep customers happy.

Even with a 10% increase on, say $600, thats what, $60? Who give a ****! I mean, your already spending $600, $60 seems like a state tax :-D or dinner out to have a great GPU LOL!!!

"Great" is in the eye of the beholder.

If you're coming from anything pre-Ampere one could argue a current gen $600 GPU may be a great deal. I wouldn't say a $600 from the current gens are a "great" GPU if you have a 3080 for example, moving to a 5070 ($550-600) would be a stupid move, only about a 15% performance gain. Or if you went AMD and got a 9700 (around $600) that would be a slightly better option with about a 25% performance gain. I wouldn't call it a great GPU, at best I'd call it a side-move and wasted money.

As for say an extra $60, that's still extra money consumers will have to pay on top of their state taxes. What would have been around $650 (after taxes) is now around $715 (after taxes). Sometimes that extra amount it costs is enough to keep people from paying.

If you think that's great, cool. Good for you. But not everyone has the luxury of simply being able to spend more at the drop of a hat on these items.

 

[Melkor Unlimited]

Article Title: AMD could increase graphics card prices ...

Explain why a multi-trillion dollar company, actually, the MOST valuable company in history by market cap, can’t eat a $3 increase in their memory from GDDR6 to 7.

Did you send this message from some parallel universe?
Or you just mixed team red-green with team greed-green?

 

[rmcrys]

Even with a 10% increase on, say $600, thats what, $60? Who give a ****! I mean, your already spending $600, $60 seems like a state tax :-D or dinner out to have a great GPU LOL!!!

That is not that simple, and with that thinking, everything can increase 10% year over year but your wage. I can hardly believe your wage increases that much that fast.

Besides, most countries have 15 - 25% sale taxes, which means for 20%:
- 600€ card: 720€ final price
- 660€ card: 792€ final price, 72€ higher price.

A 72€ increase in just one year for the same card is a lot, specially because in lots of countries it means a 1/2 up to 1 full day of net salary.

So: for an American billionaire company, absorbing a big part of that increase would be a great gesture of gratitude. From my side: it means I'll keep my GPU for a lot longer.

 

[GodisanAtheist]

The prices will come down when the crypto bubble pops, right guys?

The prices will come down when the AI bubble pops, right guys?

The prices will come down eventually, right guys?

It's a shame us Americans don't really have a culture outside of consuming to speak of, otherwise we would have walked away from this **** ages ago.

 

[Eldrach]

Money talks - right now, the AI market talks louder than the consumer market.
We’ll see a shortage until 2027 going by the rumors.
It’s interesting though - as user adoptation is actually lagging far behind the increased AI compute power.
If AI doesn’t start raking in cash the next year or so - we’ll see a massive crash for companies with shallow pockets

 

[ScottSoapbox]

Explain why a multi-trillion dollar company, actually, the MOST valuable company in history by market cap, can’t eat a $3 increase in their memory from GDDR6 to 7. A $3 increase will yield a $30 increase for the consumer, if not more.

Because their customers will pay it.