AMD has decided to change its business model, reports TomsHardware, and focus more on scalability in the GPU market rather than competing primarily in the high-end or enthusiast segment. This decision comes after years of competing with NVIDIA, where the strategy of focusing on expensive high-end products has not proven particularly successful. Instead, there will now be an increased focus on the low- and mid-range segment, which accounts for the largest share of the market.
This reorientation became known through rumors about the upcoming Radeon RX 8000 “RDNA 4” GPU series. It was speculated that AMD was making a change to its product strategy and withdrawing from the enthusiast segment. This was underpinned by the cancellation of the high-end Navi 4C/4X chip during development. Jack Huynh, Senior Vice President and General Manager of the Computing and Graphics Business Group at AMD, recently confirmed this realignment, stating that the focus is now on developing products that serve the majority of the market.
In the past, AMD and NVIDIA have both tried to position their most powerful models in the high-end segment. These models, such as the Radeon RX 7900 XTX and the GeForce RTX 4090, often dominate public presentations, although they only account for a small proportion of units sold. Smaller and cheaper models, which are more interesting for the average consumer, are often pushed into the background. However, AMD does not see a future in this approach and is now focusing on being more broadly positioned in order to reach more users.
About 80% of the GPU market falls into the low- and mid-range segment, and AMD believes that competing with NVIDIA in this space promises more success than trying to gain the upper hand in the high-end. Huynh explained that the strategy pursued to date of positioning itself as “King of the Hill” has not produced the desired results. Instead, the company will develop products that are competitive in price and performance and appeal to a wider audience.
This does not mean that AMD is withdrawing completely from the enthusiast segment. With the upcoming RX 8000 series, AMD plans to continue to be present in this area, but with a different approach. Instead of focusing exclusively on maximum performance and expensive products, budget-oriented models will now also play an important role. A similar approach has already been taken in previous generations, such as the Polaris and Vega series, which were based on the older GCN architecture. Although these series were not leaders in the gaming segment, they found their niche in other areas such as workstations and HPC (High-Performance Computing).
The introduction of the RDNA architecture was a turning point, with the RX 5000 series generating a positive market response. This was followed by the RX 6000 series, which was also well received. With the RX 7000 series, however, AMD was unable to keep up with NVIDIA’s high-end products. Although the RDNA-3 architecture theoretically offered the possibility of developing a graphics card at the level of the RTX 4090, this would have led to high energy consumption and a correspondingly high price. As a result, the RX 7000 series fell short of expectations compared to the RTX 40 series, which is also reflected in the business figures. While NVIDIA posted record profits from GPU sales in 2024, AMD struggled with a decline in its gaming division.
AMD’s new approach represents an attempt to regain a foothold in the mainstream segment and gradually move into higher performance segments from there. This change of course should enable the company to succeed in areas where potential has so far remained untapped. The upcoming RDNA-4 GPUs to be unveiled at CES next year are expected to reflect this approach. AMD plans to introduce models based on the RDNA-1 series such as Navi 48 “GFX1201” and Navi 44 “GFX1200”. These GPUs are expected to hit the market in the first few months after CES and will particularly serve the low to mid-range segment.
Source: TomsHardware
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