Could console APU manufacturing facilities be repurposed to produce RX 6000 GPUs, when demand falls?

[g67575]

So, when demand for Series X / PS5 Consoles fall, could these facilities be repurposed to produce RDNA 2 graphics cards like the RX 6700 XT, RX 6600 XT and RX 6600?

All of these graphics cards have less shader units, TMUs, ROPs and a narrower bus width than the Series X console APU, so these facilities should be capable of producing similar or less powerful GPU dies, I would think?

 

[hyperseven]

So, when demand for Series X / PS5 Consoles fall, could these facilities be repurposed to produce RDNA 2 graphics cards like the RX 6700 XT, RX 6600 XT and RX 6600?

All of these graphics cards have less shader units, TMUs, ROPs and a narrower bus width than the Series X console APU, so these facilities should be capable of producing similar or less powerful GPU dies, I would think?

demand will never fall as you are talking 10's if not 100's of millions of units over the lifespan of both consoles.

 

[Dg834man]

So, when demand for Series X / PS5 Consoles fall, could these facilities be repurposed to produce RDNA 2 graphics cards like the RX 6700 XT, RX 6600 XT and RX 6600?

TSMC is the holdup here they make all the dies

 

[Rroff]

The same facilities are used for the production of a range of electronic integrated circuits - console chips/SoCs, CPUs, GPUs, all kinds of ASICs for stuff like the automotive industry and so on they are all produced at a relatively small number of fabs owned by the likes of TSMC, Samsung, GlobalFoundries, etc. One of the problems at the moment is it is more profitable for AMD to produce a wafer of Zen cores or other SoCs than it is to use the same space to produce GPU dies while the demand and market is there for other products.

I'm not sure beyond that in terms of assembly facilities for the GPU PCB and the rest of what makes a console, etc. a lot is done by companies like Foxconn with facilities which can handle a wide range of products as well but I'm not sure on specifics there.

 

[Captain_Bosh]

Probably but I think demand for RX 6000 GPUs will fall way before Series X / PS5 Consoles do. GPU generations change much quicker than consoles.

 

[g67575]

Surely at some point though (maybe next year), demand will fall for PS5 and Series X consoles as most customers that want one will have managed to buy one.

So, excess production of console APUs would seem to be a waste, compared to much higher profit RDNA 2 graphics cards, like the 6700 XT. Speaking of which, I wonder if AMD will do a refresh of RDNA 2 cards in the first half of 2022?

Maybe even based on TSMC's 6nm fab. process?

 

[SKILL]

Why would they need to, most/all of the 6000 series GPUs are in stock everywhere, so there's no supply issue to fix by redirecting capacity from something else to GPUs?

 

[g67575]

Why would they need to, most/all of the 6000 series GPUs are in stock everywhere, so there's no supply issue to fix by redirecting capacity from something else to GPUs?

They could sell a lot more mobile and desktop GPUs, and end Nvidia's market dominance. They make a lot of profit on each card sold (reference models, less so), so why wouldn't they?

High console demand won't go on forever. It will probably only see another huge increase when they release upgraded versions of consoles.

This is probably more important than most PC gamers realise, the rumour at the start of 2021, was that 90% of AMD's 7nm allocation with TSMC was dedicated to producing console APUs.

I would've thought they have a lot more desktop CPU dies being produced by TSMC too currently, so not sure if this has been taken into account too.

 

[SKILL]

They could sell a lot more mobile and desktop GPUs, and end Nvidia's market dominance. They make a lot of profit on each card sold (reference models, less so), so why wouldn't they?

High console demand won't go on forever. It will probably only see another huge increase when they release upgraded versions of consoles.

This is probably more important than most PC gamers realise, the rumour at the start of 2021, was that 90% of AMD's 7nm allocation with TSMC was dedicated to producing console APUs.

I would've thought they have a lot more desktop CPU dies being produced by TSMC too currently, so not sure if this has been taken into account too.

Why would they sell more? It really doesn't matter whether a store/warehouse has 100 or 10000 in stock...

If they were regularly selling out/unavailable then sure more supply would help them sell more, but that's not the case.

 

[g67575]

producing more GPU dies creates more competition on price between retailers and AIB manufacturers, so customers are more likely to buy, as prices get a little closer to RRP.

Retailers are getting very few cards from suppliers at the moment, some websites even show you how many deliveries are expected for each Ampere /RDNA 2 card.

You can also tell from the lack of fulfilled pre-orders on some websites, over weeks or months. Retailers certainly don't have a backlog of cards to sell, RDNA2 cards are often in stock because retailers have been able to replenish cards at the price sold fast enough.

So prices mostly come down to AMD making decisions on GPU die production, and what to prioritize with the limited capacity available at TSMC.

 

[SKILL]

Ah, so it's not supply as much as it is price...

But frankly there's no benefit to AMD, the manufacturers or retailers on increasing supply, it just cuts profits.

That's assuming it's just the lack of GPU dies that's the cause of the prices, which it isn't. Sure that doesn't help but neither does the price of everything else, or that nvidia have used their dominance to increase GPU prices showing that the market will happily pay those prices.

AMD are clearly producing enough to meet (even if only just) the current demand, which is the best situation for them to be in financially. Whilst on the Console side they aren't even close to meeting demand, lower margins yes but still useful especially in the R&D contributions from Sony/Microsoft.

 

[g67575]

They'll be an optimum amount of GPU dies to produce in terms of profit, as this will translate to more graphics card sales overall. Graphics card prices are nowhere near RRP, so I think they could produce a lot more dies and still earn more profit overall, when demand for new consoles falls.

I suppose what we don't know, is how good a deal did TSMC and AMD get, to design and produce PS5 and Series X APUs?

If they got a really good deal from Sony and Microsoft, it might take a while to ramp down console production, but Sony and MS may decide to reduce console production if demand falls significantly.

 

[Journey]

Sony have sold 116 million PS4's since 2013, in 8 years, so that is an average of 14.5 million per year. They've shifted 10 million PS5's as of July, and consoles have never been so in demand. I think you might want to revisit your idea, not to mention the silicon inside will be changed to reduce cost, power, heat etc as the life of the console goes on.

 

[Grim5]

Demand fall? Haha good one, console demand is almost linear, they will just sell 10 to 20 million units every single year until the next one launches

 

[g67575]

Just because PS5 and Series X consoles are sold at a price (£449), doesn't mean they will keep selling at that price. These consoles are more expensive than previous generations, so only the people that really want a console will buy one, if they haven't already. I don't expect to see a reduction in price, given that they already barely break even.

I'd expect to see more sales of the cheaper versions (Series S and PS5 Digital) and less sales of the more expensive models, particularly after Christmas. From 2022 onwards, these consoles can't really be described as new anymore...

You can't always judge sales of electronics based on what's happened in previous years, because the conditions and prices are different. More people will want a console that can stream or download games, and not necessarily to play at 4K resolution (which they can't do at 60 FPS in most cases anyway. Plus many do not have 4K TVs or monitors yet).

You haven't really said why AMD wouldn't want to shift their TSMC production allocation over to mid/high end graphics cards, which should result in greater profits. Tbf, they might want to do this with CPUs too, if it's true that these are their most profitable products. Both AMD and Nvidia say they underestimated demand for graphics cards, assuming they are being honest, I think they would want to rectify that mistake.

 

[Harlequin]

AMD wont shift any wafers to gpus, in fact i can see them allocating more to consoles, ocne they get more from Apple moving to 5nm

 

[g67575]

Why would they need to do that?

 

[Mr_Sukebe]

Why would they need to do that?

Not sure why you've used the word "need".

Either way, this is almost certainly going to be a business decision purely based on which production run will be more profitable for TSMC. As we've no idea whether that's from GPUs, phones, chips for cars, or PS5s, it's just speculation.

 

[Sean473]

Console demand is one thing that has constantly gone up and up! The convienience of it almost makes this 100% certain that demand will not decrease

 

[g67575]

Console demand is one thing that has constantly gone up and up! The convienience of it almost makes this 100% certain that demand will not decrease

The convenience of paying £450 and waiting many months to get a console (if your lucky), plus any expensive games (Bluray discs) people wanna buy and controllers.

I'm not convinced, I think demand will fall in 2022, I'd be more tempted buy the Series S personally, I'd just play at 1080p instead and use a Game Pass sub to download games.

Cutting the amount produced would ensure demand for consoles remains high (therefore, prices remain high), say if the amount produced was halved. Presumably Sony and Microsoft's agreements with TSMC would be for 1-2 years (then reviewed), rather than the life of each console.

Lots of people that want the top tier consoles already have one, or will by the end of the year.