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.