AMD Losing $100 on Each New RX Vega Sale
Ashley Allen / 9 months ago
AMD promised to counter the severe lack of RX Vega graphics card supply, but in doing so it seems to be losing $100 on each unit sold. High demand – thanks to both gamers and cryptocurrency miners fighting to get their hands on the cards – should be a positive for AMD. However, the company is getting it in the neck for not fulfilling commercial needs, mainly because an ongoing HBM2 shortage. The shortage is expected to extend into October.
Losing $100 on Each New RX Vega
According to Fudzilla, AMD is making a $100 (or more) loss on every Vega 64 sold at $500. Fudzilla’s Fuad Avazovic reports:
“Our industry sources have confirmed to Fudzilla that AMD loses at least $100 on every Vega 64 card it sells at its $499 Suggested Etail Price (SEP).
The pricing of the HBM 2.0 memory, the packaging and substrate cost are simply too high to have a sustainable price of $499. We have mentioned this before, but Vega for AMD is not about making money. Don’t get me wrong, every company would like to make money with every product that it makes, but for AMD it is more important to win market share. First you win the market share, then you go after better ASPs (Average Selling Prices) and potentially start running a positive business.”
AMD is hopeful these losses are temporary as it ramps up manufacturing, but in the meantime it’ll be hoping that the hit it is taking will garner goodwill with customers.