They already do.... if you look at IGP performance...
While I agree that AMD does not have the R&D budget that they need, they may still surprise us someday with another top performer.
Personally, I do not think they are totally in the wrong aiming themselves at the mid to low markets; it is where the vast majority of the sales are at.
And while I am not advocating stopping the forward march of performance, any current CPU has enough power to keep 90%+ of users happy...