Advanced Micro Devices (AMD) , a name that has been making the headlines for its microprocessors, is set for an even better 2020. In an interview with VentureBeat, AMD CEO Lisa Su said, “Even though 2019 was a big product year, I think 2020 will be an even larger product year for us.” One of the many products scheduled for 2020 is the semi-custom APUs (accelerated processing units) designed for Sony (SNE) and Microsoft’s (MSFT) game consoles.

AMD has been a leader in the game console market. It’s the sole microprocessor supplier of the two console makers, controlling over a 90% share of the space. Both Sony and Microsoft are developing their next-generation game consoles, and they plan to launch them in the 2020 holiday season. The excitement around these game consoles is heating up as the two companies share some details about what to expect.

AMD’s game console chip is an APU that features its CPU and GPU. The company reports its revenue from game console chips in the semi-custom business. In its earnings results, it reports its semi-custom business in the EESC (Enterprise, Embedded, and Semi-Custom) segment. The EESC segment’s revenue peaks in the third quarter every year as AMD ships semi-custom chips to Sony and Microsoft. The segment’s revenue rises around 40% sequentially during this quarter. However, the third quarter of 2019 was different for EESC.

AMD’s semi-custom business slows in 2019

EESC revenue fell 11% sequentially and 27% year-over-year to $525 million in Q3 2019. This fall was driven by double-digit declines in semi-custom chip sales. These declines were partially offset by more than 50% sequential growth in EPYC server CPUs in the Enterprise business. AMD expected semi-custom sales to fall as the game console market undergoes a transition. In a product transition, previous-generation product sales fall significantly as buyers delay purchases over the anticipation of new-generation products. AMD expects semi-custom chip sales to decline further in the fourth quarter as Sony and Microsoft focus on next-gen consoles.

On the third-quarter earnings call, AMD CEO Lisa Su stated that she expects semi-custom sales to fall high-30% in the second half. Even Microsoft CFO Amy Hood, along with the September-quarter earnings results, stated that total gaming revenue fell 7% year-over-year. She expects this revenue to fall mid-20% year-over-year in the December quarter—partially due to lower console sales as Xbox One near the end of its generation. In the third quarter, AMD’s EESC operating income fell 29% year-over-year to $61 million due to higher operating expenses and lower revenue. On the earnings call, Lisa Su stated that operating expenses rose as AMD’s semi-custom business is in product transition.