World’s fastest CPU gets huge price drop, weeks after it launched but why?
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AMD launched its Genoa-based EPYC 9654 processor back in November 2022 and it immediately made headlines as the fastest x86 CPU on the planet thanks to its 96 cores (and 192 threads) running at 2.4GHz and rocking a TDP of 360W.
Its suggested retail price (SRP), $11,805, means it’s AMD’s most expensive part ever produced and it rivals the Sapphire Rapids-based Intel Xeon Platinum 8490H and its $17,000 sticker price.
However, what we’ve noticed is that several online outlets have resorted to selling AMD’s best processor at a hefty discount just about 12 weeks after launch. Wired zone sells the OEM version of the CPU (100-000000789) for $8,298 with free shipping, which is almost 30% off the SRP, which is both surprising and concerning for AMD.
To put this in perspective, this is cheaper than the EPYC Genoa 9534, a 64-core processor with an MSRP of $8,803; you can also buy two EPYC 9654 for the price of one Xeon Platinum 8490H and get some extra change.
Business technology specialist Dihuni claims to have nearly 200 of these hexanonaconta core components available at a slightly more expensive $8,534. These, along with the likes of Tech America, Comp source, StoreBLThave hundreds of AMD EPYC 9654 server parts in stock at greatly reduced prices. Even more puzzling is that at least one retailer sells refurbished EPYC 9654 made with a few more their way on eBay (opens in new tab).
The world’s fastest x86 CPU gets a massive price cut. But why?
Now there’s nothing wrong with big discounts, but given the exceptional performance of the chip in real benchmarks and the huge expectations associated with it, we’re stunned. The earnings release for Q4 2022 – as of January 2023 – showed that AMD’s operating margins declined as revenues rose, something that was attributed to “increased R&D investment to support growth”.
A contracting TAM (Total Addressable Market) was one of the reasons arch-rival Intel gave to explain why its data center and AI group (which includes the Xeon family, EPYC’s direct competitor) saw its profit margins drop by 84%. Could it be that AMD has been quietly deleting inventory from cloud customers ahead of the likely launch later this year of Bergamo and Genoa-X parts?
It’s important to remember that the CPU is only part of the equation and the 9654 works best when paired with advanced but expensive DDR5 memory as part of the new SP5 platform. At times when even hyperscalers feel the pinch, upgrade cycles tend to be longer and cheaper alternatives where possible, such as the more mature but still capable EPYC Milan product range.
What about others?
The aforementioned EPYC 9534 can be purchased for about $6,200which is equivalent to the 9654’s 30% discount. Other parts, such as the more specialist, speed-optimized EPYC 9174F, have a much lower discount (less than 10%).
We didn’t see similar price drops across the board for the Intel Xeon processor; for example, the Xeon Platinum 8380 is still around the same MSRP of $9,359, while Intel’s most expensive part, the 8490H, commands a premium of around 10% at the time of writing. (Check out the excellent review of the EPYC 9654 posted by our sister publication, Toms hardwarein November 2022.)