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You can also have better profit if you minimise expenses - which is exactly why we'll only have two RDNA 4 chips. The burger van in the corner doesn't have to compete with McDonald's for market share.But the latter is a component of the former. After all, with 0 marketshare you have nobody buying your product and therefore 0 possible profit! Yes, it is possible to have a very small marketshare but massive profits, if you are in a very niche industry and/or have a captive target market (e.g. ASML to TSMC) - which is not the case for consumer products. So therefore in the consumer space, it is entirely correct to say that companies live on their marketshare.
Sure, market share is important in AMD's case, but not important enough to sell GPUs at a loss.