World’s fastest CPU gets huge price drop, weeks after it launched but why?

AMD launched its Genoa-based EPYC 9654 processor back in November 2022 and it immediately grabbed the headlines as the fastest x86 CPU on the planet thanks to its 96 cores (and 192 threads) that run at 2.4GHz and rock a TDP of 360W. 

Its suggested retail price (SRP), $11,805, means that it is AMD’s most expensive part ever produced and it goes head to head against the Sapphire Rapids-based Intel Xeon Platinum 8490H and its $17,000 sticker price.

What we’ve noticed though is that several online outlets have resorted to selling AMD’s finest processor at a steep discount only 12 weeks or so after launch. Wiredzone sells the OEM version of the CPU (100-000000789) for $8,298 with free shipping, that’s a near 30% discount off the SRP, which is both surprising and worrying for AMD. 

To put this in perspective, this is cheaper than the EPYC Genoa 9534, a 64-core processor that has an SRP of $8,803; you can also buy two EPYC 9654 for the price of one Xeon Platinum 8490H and still get some change.

Corporate tech specialist Dihuni claims to have nearly 200 of these hexanonaconta-core parts available at a slightly more expensive $8,534. These, together with the likes of Tech-America, Compsource, ShopBLT, have hundreds of AMD EPYC 9654 server parts in stock at deeply discounted prices. Even more puzzling, at least one retailer is selling refurbished EPYC 9654 with a few more having made their way on eBay.

World’s fastest x86 CPU gets massive price cut. But why?

Now there’s nothing wrong with deep discounts but given the exceptional performance of the chip in real life benchmarks and huge expectations pinned on it, we’re dumbfounded. The earnings release for Q4 2022 – from January 2023 – showed that AMD operating margins were dropping as revenue increased, something that it attributed to “higher R&D investments to support growth”.

A contracting TAM (Total Addressable Market) was one of the reasons given by archrival Intel to explain why its datacenter and AI group (which includes the Xeon family, EPYC’s direct competitor) saw an 84% drop in its profit margins. Could it be that AMD has quietly started to get rid of inventory from cloud customers ahead of the probable launch, later this year of Bergamo and Genoa-X parts?

It is important to remember that the CPU is only part of the equation and that the 9654 works best when paired with bleeding-edge but expensive DDR5 memory as part of the new SP5 platform. At times when even hyperscalers are feeling the pinch, upgrade cycles tend to be longer and where possible, cheaper alternatives, like the more mature but still capable EPYC Milan product range.

What about others?

The aforementioned EPYC 9534 can be had for about $6,200, which matches the 30% discount of the 9654. Other parts such as the more specialist, speed-optimised EPYC 9174F, have a much lower discount (less than 10%). 

We didn’t see similar drops in price across the board for Intel Xeon processor; for example, the Xeon Platinum 8380 still commands roughly the same price as its suggested retail price of $9,359 while Intel’s most expensive part, the 8490H, actually commands a premium of about 10% at the time of writing. (Check out the superb review of the EPYC 9654 posted by our sister publication, Tomshardware, back in November 2022.)