AMD is sitting pretty as they now power all three of the new consoles on the market. First they have the Nintendo Wii U, which contrary to common belief isn’t doing to bad in terms of sales, then we have the PlayStation 4 and Xbox One, both of which pack high end AMD APU’s, knocking Nvidia completely out of the next-gen console race.
Of course AMD didn’t do this out of the kindness of their heart, this is a business deal and one that looks set to generate more than $3 billion in revenue for them thanks to the deal they’ve penned with Microsoft.
Bob Feldstein, an ex AMD employee who defected to Nvidia let the details of the deal slip. It is however a muti-year deal and that should se AMD generate this revenue over a period of around 5 years, as right now AMD’s revenue is worth around $1 billion.
This isn’t easy money though as the profit margins in consoles suck pretty badly and large volume need to be generated, marketed and sold before real profits start to roll in, but if the long term strategy pays off for AMD it could give them the financial life line they’ve been needing.
