Sales of AMD's new AI chips are going gangbusters. Well, relatively speaking. AMD's latest results for the second quarter of this year showed that the company flogged roughly $1 billion's worth of its Instinct MI300 AI GPUs in the quarter, up from pretty much zero for the same class of hardware a year ago.

Overall, AMD's revenues were up 9% to $5.8 billion compared to the same period last year. Of course, the relative bit arrives when you compare all that with Nvidia's AI GPU sales, which came in at roughly $20 billion for the first quarter of 2024. So, AMD has done well to get a foothold in the mega-profitable AI GPU market. But it's still miles behind Nvidia.

On a related note, AMD's CEO Lisa Su indicated the company is essentially selling as many Instinct MI300 AI GPUs as it can make. “The overall supply chain is tight and will remain tight through 2025, ” Su said of the Instinct MI300 (via Seeking Alpha).

Elsewhere, the news was mostly good but with some mixed indicators. Sales of PC processors were up by a hefty 49% to $1.5 billion, for instance. That's very impressive when you consider AMD is in the process of launching its new Zen 5 chips. Those $1.5 billion of sales will be pretty much all Zen 4 and earlier CPUs. Zen 5 looks very promising, so it all bodes very well.

Until you look at AMD's “Gaming” division, that is, where revenues fell by a fairly catastrophic 59%, year on year. To quote Lisa Su again, “turning to our gaming segment, revenue declined 59% year-over-year to $648 million as semi-custom SoC sales declined in-line with our projections. Semi-custom demand remains soft, as we are now in the fifth-year of the console cycle and we expect sales to be lower in the second half of the year compared to the first half.

“In gaming graphics, revenue increased year-over-year driven by improved sales of our Radeon 6000 and 7000 series GPUs in the channel,” she said.

AMD didn't release specifics regarding Radeon sales. But as we understand it, “Gaming” includes both console chips and Radeon graphics. So, the fact that Gaming overall fell so precipitously despite those “improved” Radeon sales implies both that Radeon sales are pretty titchy and that they can't have improved by all that much.

Overall, Gaming currently represents just over 10% of AMD's revenues and falling. Indeed, Lisa Su predicted further double-digit percentage falls for the Gaming division for next quarter.

Moreover, Su didn't have much to say about those gaming products during the earnings call for investors covering AMD's latest results. There were no upbeat promises of new Gaming products that would begin to turn things around. All of which makes for a mixed feeling for PC gamers.

AMD generally is doing well and surely has plenty of resources to invest in future chips. Hooray. But it still doesn't seem to be able to turn around its struggling graphics division. Haroo.

We really, really would love to see AMD putting more pressure on Nvidia when it comes to graphics cards. So, here's hoping AMD is fully keeping faith with its Gaming division despite these latest results.