AMD expects that overall PC and Gaming demand will decline in the second half of this year due to rising memory and component prices.
RAMpocalypse Is The Primary Reason Why PC and Gaming Demand Will Decline In The Second Half of This Year, Says AMD
In its Q1 2026 earnings, AMD's Client and Gaming segment saw a 23% increase in revenue versus the prior year, reaching $3.94 billion, while declining 9% versus the previous quarter.
AMD states that its client side, which includes desktop and laptop segments, saw great traction through a strong portfolio of products, which includes its latest Ryzen 9000X3D CPUs for desktops, & the Ryzen AI portfolio for laptops, which stirred an impressive sell-through of more than 50% (YOY). OEMs such as Dell, HP, and Lenovo have expanded their offerings with Ryzen AI 300/400 serving the mainstream & Ryzen AI MAX aiming at the high-end AI/Workstation segments.
While AMD expects demand for its Ryzen CPUs to remain solid in the second quarter of 2026, the overall shipments will see a decline in the second half of this year. That's mainly in part due to the RAMpocalypse, which has caused a sharp rise in memory prices due to growing demand from the AI industry.
Industry sources have already warned of an imminent price hike in addition to the 10% bumps that are already placed on consumer chips. These prices will affect both Ryzen Desktop and Ryzen Laptop CPUs.
In desktop, we strengthened our Ryzen lineup, including our latest X3D processors that deliver leadership performance across gaming, content creation, and professional workloads. We also introduced the Ryzen AI 400 series and Ryzen AI Pro 400 series desktop CPUs, extending our AI PC offerings across both consumer and commercial systems. In mobile, we delivered strong growth driven by a richer product mix as Ryzen 400 mobile PC shipments ramped and commercial adoption increased.
Commercial was a key highlight in the quarter, with sell-through of Ryzen Pro PCs increasing more than 50% year-over-year as Dell, HP, and Lenovo broadened their AMD offerings. Looking ahead, we expect demand for our Ryzen CPUs to remain solid in the second quarter.
However, we are planning for second-half PC shipments to be lower due to higher memory and component costs. Against this backdrop, we still expect our client revenue to grow year-over-year and outperform the market, driven by the strength of our Ryzen portfolio and expanding commercial adoption.
Dr. Lisa Su - AMD CEO
The Gaming side, which includes both Radeon and Console segments, will see a bigger impact due to the rising memory and component costs. AMD states that gaming revenue was down 15%, and anticipates a further 20%+ decline versus the first half of 2026.
Both Microsoft and Sony have announced increased prices for their current-generation consoles, the PS5 series and the Xbox Series platforms. With more price hikes on components, including memory, expected in the second half of this year, we can expect another round of price bumps on these consoles.
Similar to the PC market, we believe that second-half demand in gaming will be impacted by higher memory and component costs, and we are planning the business accordingly.
Dr. Lisa Su - AMD CEO
Sequentially, gaming revenue was down 15%, consistent with our expectations. In addition, as Lisa mentioned earlier, 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.
Jean Hu - AMD CFO
Talking about memory supply constraints, AMD's CEO said that while memory remains tight for everyone, they are working with their partners and have secured enough supply to "meet and exceed" their targets.
The bigger demand is being seen in the data center segment, which should be obvious as the data center ecosystem includes memory being gobbled up by AI.
I think from a supply standpoint, we are very happy with our partnership with the memory vendors and we have secured enough supply to, you know, certainly meet and exceed our targets.
So, it is a tight memory environment, let me be clear, but I think we have a very deep partnership with the memory providers. And then back to your comments on the inflationary pressures. I mean, look, this is something that everyone in the industry is working with.
In the time of tight supply, you know, we are seeing cost increases on the memory side. I think we are all working through that. 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.
I mean, people are largely focused on supply and ensuring that the supply assurance is there. The corollary of that, you know, the larger impact that we're watching is, you know, the impact on the consumer markets. And, you know, as we said in the prepared remarks, you know, we are expecting that there could be, you know, some demand impact as a result of the memory price increases on, you know, things like the PC business in the second half of the year, as well as the gaming business.
Dr. Lisa Su - AMD CEO
Despite robust year-over-year growth and strong momentum in Ryzen AI and gaming products, AMD expects overall PC and Gaming demand to weaken in the second half of 2026. The primary cause is the “RAMpocalypse” — sharply rising memory and component prices driven by surging AI demand.
While the company anticipates client revenue will still grow and outperform the broader market, higher costs are likely to weigh on shipments and gaming revenue.
About the author: A Software Engineer by training and a PC enthusiast by passion, Hassan Mujtaba serves as Wccftech's Senior Editor for hardware section. With years of experience in the industry, he specializes in deep-dive technical analysis of next-generation CPU and GPU architectures, motherboards, and cooling solutions. His work involves not only breaking news on upcoming technologies but also extensive hands-on reviews and benchmarking.
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