AMD boosts its Q3 R&D spending by over 25% Year-Over-Year
AMD boosts its Q3 R&D spending by over 25% Year-Over-Year
Right now, AMD expects its full-year 2020 revenues to be 41% higher than 2019, giving the company more money to work with and more money to invest in research and development.Â
In Q3 2020, AMD has increased its R&D spending by around 25.1% year-over-year (YoY), representing an increase of $102 million. That’s a lot of money, and this increase in spending is a clear sign that AMD’s prepared to continue aiming higher within the CPU and GPU markets.Â
Research and Development is the lifeblood of all technology companies. While Ryzen and RDNA were created on shoestring budgets, AMD knows that it needs to increase its R&D budget if it wants their success to continue. AMD is diversifying, and that diversification will require increased spending. This year, AMD plans to split its graphics roadmap into gaming-focuses and datacenter-focused segments, creating their RDNA 2 and CDNA architectures. With this shift, AMD plans to become more competitive within both of these markets, delivering their customers more value while increasing the company’s total GPU sales.Â
Given the perceived weakness of Intel following its 10nm and 7nm delays, AMD must continue innovating to maintain x86 as the instruction set architecture (ISA) of choice within the datacenter and PC markets. AMD cannot afford to slow down its development efforts, as lacklustre products from both AMD and Intel will force the market to look towards non-x86 processors.Â
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| R&D Budget (Millions) | 2018 | 2019 | Increase (QoQ) | Increase (YoY) |
| Q1 | $343 | $373 | 0.5% | 8.7% |
| Q2 | $357 | $373 | – | 4.5% |
| Q3 | $363 | $406 | 8.8% | 11.8% |
| Q4 | $371 | $395 | -2.7% | 6.4% |
| R&D Budget (Millions) | 2019 | 2020 | Increase (QoQ) | Increase (YoY) |
| Q1 | $373 | $442 | 11.8% | 18.5% |
| Q2 | $373 | $460 | 4.0% | 23.3% |
| Q3 | $406 | $508 | 10.4% | 25.1% |
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AMD’s main concern right now is to ensure that its success continues in the coming quarters, which means that the company cannot allow its R&D efforts to fall behind. AMD needs a strong hardware roadmap to continue competing with both Intel and Nvidia, both of which have the ability to outspend AMD. Strong IP and continuous generational improvements will help AMD to continue its positive growth. Still, as its CPUs and GPUs become more complex, more and more effort will be required to continue pushing the performance envelope.Â
AMD’s original Zen architecture released in Q1 2017 and that quarter saw AMD spend $271 million on Research & Development. In Q3 2020, AMD has spent $508 million, representing an increase in spending of over 87%. That’s how far AMD’s research efforts have come since the release of Ryzen.Â
You can join the discussion on AMD’s increased R&D spending on the OC3D Forums.Â