AMD Set to Increase Radeon GPU Kit Prices by 10% in July

AMD to Increase GPU Kit Prices for Add-In Board Partners

AMD is reportedly set to implement a price increase on its GPU kits supplied to add-in board (AIB) partners, according to information from Chinese Board Channels. The anticipated adjustment, expected to take effect in July, will see a 10% rise in the cost of GPU kits, which include both the GPU die and GDDR6 memory. This change will impact AIBs manufacturing custom Radeon RX graphics cards with specialized printed circuit boards (PCBs).

Factors Driving the Price Hike

One of the primary reasons behind this price increase is the ongoing shortage of GDDR6 memory. AMD typically sources GDDR6 from leading memory manufacturers such as SK hynix, Samsung, and Micron. By procuring memory in large volumes, AMD can negotiate more favorable contracts than individual AIBs could secure on their own. However, the current supply constraints in the memory market have forced AMD to adjust its pricing strategy for GPU kits provided to partners like Sapphire, ASUS, and XFX.

Potential Impact on Consumer GPU Prices

While the 10% increase applies to the GPU kits sold to AIBs, this does not necessarily translate to an immediate or equivalent price hike for consumers. The GPU kit is just one component of the total cost involved in producing a graphics card. Other factors, such as manufacturing, logistics, and distribution, also contribute to the final retail price. As a result, the actual price increase seen by consumers may be less than 10%.

However, it is likely that AIBs will pass at least some of these additional costs onto consumers. The timing and extent of price changes at retail will depend on how quickly AIBs and retailers adjust their pricing structures. Some AIBs may maintain current pricing for inventory produced before the increase, but retailers and smaller resellers could implement price adjustments more rapidly, especially in response to news of rising costs.

Outlook for the GPU Market

This development aligns with earlier expectations that GPU prices could rise in the third quarter of the year, though the changes are materializing as early as July. If the supply of GDDR6 memory remains constrained, further price increases may occur in the coming months. For PC builders and DIY enthusiasts, the ongoing volatility in GPU pricing presents continued challenges, with no immediate relief in sight.