NVIDIA CFO Colette Kress highlighted some important aspects of their gaming business, including existing channel inventory and their recently launched GeForce RTX 4090/4080.
NVIDIA Reports Strong GeForce RTX 4090 ‘Ada’ Graphics Card Sales, Stabilizing Channel Inventory
Colette Kress, NVIDIA’s chief financial officer, said it has been underdelivering GPUs to the gaming segment for some time. This was revealed at Credit Suisse’s 26th Annual Technical Conference. We know that the market has recently been flooded with an excess of used GPUs due to the end of the crypto craze and the drop in prices of latest generation GPUs, both in retail and second-hand markets. , there was little to no demand for more GPUs. That said, NVIDIA is now starting to refresh its older RTX 30 GPUs with new offerings and resuming shipments to stabilize its channel inventory and backlog.
The company expects its channel inventory to return to normal by the end of the fourth quarter and it will resume shipments from 1H 2023. The company also plans to grow its channel for the launch of Ada and all additional Ada-based GPUs (Desktops/Workstations/Laptops) coming to market.
So we undershipped. We’ve been undershipping games right now so we can fix this inventory coming out in the channel.
And as we discussed, we anticipate hopefully by the end of the fourth quarter, as we approach the end of the fourth quarter, that we will be in a strong position for that. This means that as we move forward, we will begin to rise again. We will come to a certain point of balance between selling and selling. And then we’ll probably get to where we’ll be selling to build the channel for our Ada launch and any additional Ada products that we’ll see come to market.
Colette Kress, CFO of NVIDIA
Kress also reports that NVIDIA’s GeForce RTX 4090 and RTX 4080 are still in their early stages. We know from our previous reports that NVIDIA has shipped around 160,000 RTX 40-series graphics cards since mid-November. That number may be higher now, but we also know that the bulk of shipments include the GeForce RTX 4090 graphics card, which has been the flagship launch of the Ada family so far. The NVIDIA GeForce RTX 4080, on the other hand, didn’t receive as much response as the RTX 4090 due to its lackluster performance relative to its dollar value. Even resellers who got the cards and tried to sell them at absurd prices resort to selling them at MSRP since nobody cares.
Ada is only in the first days of the expedition. We’ve shipped, one of our very high end cards is the 4090 and our 4080 is just starting to sell out as well.
Colette Kress, CFO of NVIDIA
It is also pointed out that NVIDIA’s GeForce RTX 4090, despite being the flagship with a starting price of US$1599, sold out in 2 weeks. We know that NVIDIA initially shipped 100,000 cards (GeForce RTX 4090), so it’s very impressive if the chipmaker managed to sell out their entire inventory in less than 2 weeks.
Our Ada launch, 4090 when it was released, yes, it was only the very first card and the high end card, it sold out in 2 weeks. So we’re very happy to see something that was a snap for us, that we knew that gaming, whatever the time of year, whatever the situation, is still a very important entertainment industry .
Colette Kress, CFO of NVIDIA
NVIDIA also highlighted their popularity by including numbers from Steam’s hardware survey. The company says the top 15 cards in the SHS come from NVIDIA. The GTX 1650 recently took the top spot with a 6.27% market share, followed by the GTX 1060 at 5.77% market share and the RTX 2060 taking 3rd place as the only graphics card. RTX” with a market share of 4.64%. Neither the RTX 4090 nor the RTX 4080 have appeared in the Steam hardware survey so far, but they should start taking a share by Q1 2023.
We have seen great new players join this market and take advantage of the leadership we have in terms of games. Not only is Ada a leader in the industry, so is Ampere. So architecture number 1 and number 2 are NVIDIA. We continue to watch what we see in terms of Steam. Steam still has an all-time high of online players, games. And the top 15 cards on Steam are NVIDIA, all 15 out of 15. So this is an area where gamers will be gamers for life. And we’re watching this industry both in the big times and also in some of the tough times. It’s a budget sport because you can choose many different form factors at many different price points for the game you want to play.
Colette Kress, CFO of NVIDIA
NVIDIA is expected to introduce more mainstream GeForce RTX 40-series graphics cards in the first half of 2023. The company recently scored a big step in the latest discrete GPU market share report, claiming up to 88% market share according to the JPR report. We can expect this trend to continue in the coming quarters until NVIDIA and AMD enter the midrange segment where the majority of market share comes from.
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