If we know that since the release of Covid and the collapse of cryptocurrencies, NVIDIA and AMD have suffered a sharp decline in revenue. In fact, GPU shipments are down 42% compared to the same period last year. From a market share perspective, the Reds are suffering tremendously. Factually, even in trouble, NVIDIA has strengthened its position in the market at the expense of Radeon cards. Intel, in pain for its launch, managed to take 4% of the market. By the end of Q3 2022, Nvidia cards accounted for the vast majority of the desktop GPU market at 86% of the market, with AMD trailing with a meager 10%. Most concerning is the volume of GPUs shipped by the Reds: 690,000 GPUs, a level not seen in 13 years of data collection. This is thanks to the work of Jon Peddie and his annual GPU summary report, which includes quarterly shipment data. A 319 pages, 245 graphs and 54 tables with which we realize the worrying evolution of the situation.
AMD and Intel: crumbs in a market that is losing value.
As always with numbers, the analysis of them comes down to a story of glass half empty or half full. For AMD, it’s the volume of GPUs that really matters. But should we worry about the reds? Beware of the magnifying glass effect as AMD’s revenues have increased by 45% in 2020 and another 68% in 2021. These “COVID” years have really fattened the manufacturers. AMD has used this time to diversify its business and solidify the foundation of its company. Analysts expect its revenue to grow another 43% this year, thanks in part to the Xilinx acquisition in February, but to slow to 6% in 2023…6% growth, a number that would make quite a few companies dream.
The real question is about the GPU market and only this one. Because the arrival of Intel Arc GPUs has been to the detriment of AMD. In the future, the rise in power of the ARC range may generate even more headaches for AMD. On the high-end, it is difficult to predict the future but Nvidia seems to hold its positions. The question is therefore for Intel and AMD: how to reach profitability in a market that will globally lose value for a few more months? The time factor is the key to this story and that’s where the problem lies.
Because in our case, there is a protagonist that we all have difficulty mastering: the stock market. The stock market has the final say… If the GPU sectors start to accumulate losses that are a stain on an economic presentation, this will trigger bad impulses in investors. And often these impulses lead to rather radical decisions…
