Yah, they are far behind in the desecrate graphics business. So investing more in console hardware makes sense from a return on investment.Development of new CPU and GPU costs money. Huge money.
Not only that AMD is not developing those gaming consoles chips "for free", but it is covering a big chunk of the development costs needed to keep making new CPU and GPU designs. Without consoles' sales, AMD would be closed today.
Go to the steam hardware GPU charts, you will see nvidia dominate the first 17 positions. AMD comes in the 18th place for the number of people playing on AMD gpu