'We now expect second half gaming revenue to decline more than 20%': AMD feeling the sting of the memory supply crisis

"I mean, look, this is something that everyone in the industry is working with."
AMD reports it made $10.3 billion in revenue during the first quarter of 2026.

While revenue growth has been more or less flat quarter-on-quarter, this figure otherwise represents a growth of 38% compared to the same period in 2025.

By all accounts, AMD is continuing to dine well on the demand for "high-performance CPUs and accelerators" from the AI industry—though even this heavy hitter won't be immune to 'headwinds' caused by the memory supply crisis.

First, let me break down that frankly eye-watering $10.3 billion figure in the press release : AMD's data centre segment represents a $5.8 billion slice of that pie—which has also grown 57% compared to Q1 2025—while gaming alone represents only about $720 million.

It always feels wrong to say 'only' in relation to a monetary amount in the millions, especially as gaming grew about 11% year-on-year.

However, AMD is advising investors to expect a sharp dip in this sector shortly.

During the recent earnings call , executive VP, CFO and treasurer Jean Hu advised "We expect second half demand in gaming to be impacted by higher memory and component costs.

We now expect second half gaming revenue to decline more than 20% compared to the first half."
In other words, with consumer memory prices skyrocketing , and other components, such as CPUs , also experiencing knock-on shortages, PC gamers are understandably expected to spend less overall.

AMD CEO Lisa Su later added during the same call, "We're making very good progress in the commercial PC arena with our AI PCs.

We did see desktops a little bit softer just given desktop is a more consumer-focused market.

And so in that market, it's more impacted by some of the memory pricing and the component price increases."
AMD's gaming projections are not necessarily a shock; in response to an investor question, Lisa Su elaborated, "I mean, look, this is something that everyone in the industry is working with—in the time of tight supply, we are seeing some cost increases on the memory side.

I think we are all working through that."
Indeed, both Nvidia and Microsoft have made similar predictions about how the memory crisis will affect their revenue.

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"The way we're seeing it unfold in the market is actually on the Data Center side, because of the, let's call it, the demand for AI compute," Su continues, "People are largely focused on supply and ensuring that the supply assurance is there.

The corollary of that—the larger impact that we're watching is the impact on the consumer markets.

And as we said in the prepared remarks, we are expecting that there could be some demand impact as a result of the memory price increases on things like the PC business in the second half of the year as well as the Gaming business.

So we're taking that into account in our overall model."
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Jess has been writing about games for over ten years, spending a significant chunk of that time working on print publications PLAY and Official PlayStation Magazine.

When she’s not investigating all things hardware here, she's either constructing a passionate defence of a 7/10 game, daydreaming about her debut novel, or feeling wistful about the last time she chased some nerds around a field with an oversized foam sword.

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