Graphics card shipments are on the decline, profit margins still high

[Greg S]

The big picture: Cryptocurrency miners bought a massive stockpile of graphics cards between April 2017 and March 2018. As mining difficulty has gone up and block rewards have gone down, fewer people are operating mining rigs. The resulting shortages have raised prices across the board.

As pricing is getting better on graphics cards that are up to two years old, the number of shipments is expected to fall during the second half of this year. According to Taiwan suppliers, the decline in cryptocurrency has allowed for the focus to be shifted back to gamers once again.

Despite prices being slightly reduced, profit margins are still doing better than ever before. Asus, Gigabyte, MSI, and TUL are all reportedly maintaining profit margins of around 20 percent. Before April 2017 when cryptocurrencies really started to take off, many add-in board partners were only turning an eight to ten percent margin. At their peaks, board partners were earning between 40 and 50 percent profit on cards sold to gamers and miners with inflated pricing.

For gamers, there is good news for the future. Mining is becoming less rewarding to owners of high end GPUs. Government restrictions and the crackdown on excessive energy consumption are also making mining even less viable than before.

Even though this is not good news for those that have an array of graphics cards lined up on racks, gamers should rest easy. Whenever the next generation of graphics cards are finally launched, there may not be a massive rush to buy every last card available, at least by miners.

Considering that the GTX 1080 originally launched in May 2016 and AMD's RX Vega series has received little attention from gaming fans, there may still be enough gamers seeking upgrades that further shortages are not out of the question. Regardless, cryptocurrency miners are not going to be a problem for gamers for the foreseeable future.

Permalink to story.

https://www.techspot.com/news/75169-graphics-card-shipments-decline-profit-margins-high.html

 

[senketsu]

I suspect there is a backlog of gamers waiting for a good card for reasonable prices (and as you mention the GTX 1080 is from May 2016).

 

[TomSEA]

Bad timing for the card prices to come back down to earth. Everyone who's shopping for a card (and I'm in that category) are waiting for the next generation which will be coming out later this year.

 

[ShagnWagn]

I would not consider the 10xx series of cards "good" any more, as they are over 2 years out of date. I suspect that as miners try to offload the 1080 cards they jacked from gamers that they will be going to the landfills because of market flooding and the cards getting pounded for so many hours. Such a waste on mining that it's a total waste of resources. I am unaware of anything beneficial from mining.

 

[Cycloid Torus]

Based on 'rule of thumb' (secret formulae from a previous life) the GTX 1060 - 1080s are still fully 30% overpriced for new. Expect discounts.

Used should fall to half of that.

Enjoy shopping!

 

[Burty117]

Bad timing for the card prices to come back down to earth. Everyone who's shopping for a card (and I'm in that category) are waiting for the next generation which will be coming out later this year.

I'm with you on this, I've got the money but I'm not buying a 1080Ti since we'll know more about the next version in August.

 

[Evernessince]

Bad timing for the card prices to come back down to earth. Everyone who's shopping for a card (and I'm in that category) are waiting for the next generation which will be coming out later this year.

I'm with you on this, I've got the money but I'm not buying a 1080Ti since we'll know more about the next version in August.

Nvidia just cancelled it's Hot Chips appearance so you may be waiting longer.

It makes sense as product is flying off the shelves. Announcing new product will just slow sales. The sad part about this all is that rumor has it AMD's navi will only be midrange, so we don't even know when AMD's next high end graphics cards will come. If true AMD is already giving up the fight for next gen cards as well.

 

[pcnthuziast]

Both teams want to raise the baselines for accepted retail prices. It sucks, but I have zero faith anything consumers do will counter this. I'll be buying the next 80 tier card and fully expect to pay 800+ for the non ti version on release.

 

[bas416]

Bad timing for the card prices to come back down to earth. Everyone who's shopping for a card (and I'm in that category) are waiting for the next generation which will be coming out later this year.

Thanks God prices are not going anywhere, plus overstock pushes out next gen. Your problem is solved!

 

[McMurdeR]

For owners of good performing current gen cards, it doesn't look like we can expect anything particularly exciting this year.

With Intel joining the frey in 2020, expect all hell to break loose.

 

[Burty117]

Bad timing for the card prices to come back down to earth. Everyone who's shopping for a card (and I'm in that category) are waiting for the next generation which will be coming out later this year.

I'm with you on this, I've got the money but I'm not buying a 1080Ti since we'll know more about the next version in August.

Nvidia just cancelled it's Hot Chips appearance so you may be waiting longer.

It makes sense as product is flying off the shelves. Announcing new product will just slow sales. The sad part about this all is that rumor has it AMD's navi will only be midrange, so we don't even know when AMD's next high end graphics cards will come. If true AMD is already giving up the fight for next gen cards as well.

Well I Googled it, you're right, I've just ordered myself a 1080Ti, waterblock and backplate.

I'll probably regret that in the morning...

 

[TomSEA]

Bad timing for the card prices to come back down to earth. Everyone who's shopping for a card (and I'm in that category) are waiting for the next generation which will be coming out later this year.

I'm with you on this, I've got the money but I'm not buying a 1080Ti since we'll know more about the next version in August.

Nvidia just cancelled it's Hot Chips appearance so you may be waiting longer.

It makes sense as product is flying off the shelves. Announcing new product will just slow sales. The sad part about this all is that rumor has it AMD's navi will only be midrange, so we don't even know when AMD's next high end graphics cards will come. If true AMD is already giving up the fight for next gen cards as well.

Well I Googled it, you're right, I've just ordered myself a 1080Ti, waterblock and backplate.

I'll probably regret that in the morning...

LOL...I'm tempted. But if I'm going to drop $600+ on a card, I'll wait for the next generation. My 980ti seems to be holding up well enough.

 

[Evernessince]

Well I Googled it, you're right, I've just ordered myself a 1080Ti, waterblock and backplate.

I'll probably regret that in the morning...

I can't say that's a bad choice. We don't know when the next card will drop of if they will even be reasonably priced. If the rumors prove true above navi only being mid-range and Nvidia jacks it's prices up again I might just stick with my 1080 Ti for awhile. It's sad that we might have to wait until 2020 for Intel or AMD come out with something.

 

[Stark]

The thing is in my very short span of life, and even in that the shorter amount of time I have been a hardware enthusiast, once the price of a product goes up companies make it the default value, as if they are trying to see how far they can push the envelope. At first it was due to mining, but even now the RX 580 is retailing around 1070's old MSRP. And my guess is it will stay that way and falling for a very short window just as the arrival of new series happens on retail shelves, and the new series will be priced accordingly the current MSRP. So mining has got gamers screwed for the long haul even if they have subdued their demand as of now.

 

[Evernessince]

The thing is in my very short span of life, and even in that the shorter amount of time I have been a hardware enthusiast, once the price of a product goes up companies make it the default value, as if they are trying to see how far they can push the envelope. At first it was due to mining, but even now the RX 580 is retailing around 1070's old MSRP. And my guess is it will stay that way and falling for a very short window just as the arrival of new series happens on retail shelves, and the new series will be priced accordingly the current MSRP. So mining has got gamers screwed for the long haul even if they have subdued their demand as of now.

Demand also likely has something to do with current pricing as well. I'm not so sure MSRP of next gen cards will be low either. Nvidia doesn't really have much in the way of competition.

 

[fadingfool]

Well I Googled it, you're right, I've just ordered myself a 1080Ti, waterblock and backplate.

I'll probably regret that in the morning...

There's always something better going to come along. I upgraded back at the end of Jan to a whole new system - 7820X, 1080Ti etc. Now we have Ryzen + (same performance as 7820X for half the price) and the new threadripper will be soon (so probably could have squeezed the credit card a bit harder). But I've had 5 months now of pretty damn good performance in a nice rig. So don't regret - enjoy your 1080Ti

 

[Burty117]

LOL...I'm tempted. But if I'm going to drop $600+ on a card, I'll wait for the next generation. My 980ti seems to be holding up well enough.

I can't say that's a bad choice. We don't know when the next card will drop of if they will even be reasonably priced. If the rumors prove true above navi only being mid-range and Nvidia jacks it's prices up again I might just stick with my 1080 Ti for awhile. It's sad that we might have to wait until 2020 for Intel or AMD come out with something.

There's always something better going to come along. I upgraded back at the end of Jan to a whole new system - 7820X, 1080Ti etc. Now we have Ryzen + (same performance as 7820X for half the price) and the new threadripper will be soon (so probably could have squeezed the credit card a bit harder). But I've had 5 months now of pretty damn good performance in a nice rig. So don't regret - enjoy your 1080Ti

£695 for an EVGA SC Black Edition 1080Ti
£130 for an EK full cover Water Block
£25 for an EK Back Plate

My wallet is very much upset with me, but the Geek in me is rather excited. I've never done a custom loop build before, already trembling about not doing the loop properly and it getting a leak.

 

[Nobina]

I would not consider the 10xx series of cards "good" any more, as they are over 2 years out of date. I suspect that as miners try to offload the 1080 cards they jacked from gamers that they will be going to the landfills because of market flooding and the cards getting pounded for so many hours. Such a waste on mining that it's a total waste of resources. I am unaware of anything beneficial from mining.

If those cards are out of date what isnt? They are current and recieve updates, what you are saying makes no sense.

 

[ShagnWagn]

If those cards are out of date what isnt? They are current and recieve updates, what you are saying makes no sense.

My 8 year old card still gets updates. I guess you need to re-read my first sentence. Two years is out of date for the typical video card release schedule.

A simple google searched would have helped you: http://www.tomshardware.com/answers/id-3412250/nvidia-release-gpus.html

While you might point out there has been a release every year, recently there have been no generational release and the 1080 is three calendar years old.

 

[penn919]

If those cards are out of date what isnt? They are current and recieve updates, what you are saying makes no sense.

Presumably they are "out of date" because they are a whopping 2 years old (eye roll). Nevermind the fact that they are the latest cards on the market. Seriously, if I upgraded my stuff by the loose critera thrown around on this forum I'd barely be able afford a home to use them in.

 

[Nobina]

My 8 year old card still gets updates. I guess you need to re-read my first sentence. Two years is out of date for the typical video card release schedule.

A simple google searched would have helped you: http://www.tomshardware.com/answers/id-3412250/nvidia-release-gpus.html

While you might point out there has been a release every year, recently there have been no generational release and the 1080 is three calendar years old.

I understand what you are trying to say but what you actually wrote doesn't make sense, also what you are actually trying to say is also nonsense.

Presumably they are "out of date" because they are a whopping 2 years old (eye roll). Nevermind the fact that they are the latest cards on the market. Seriously, if I upgraded my stuff by the loose critera thrown around on this forum I'd barely be able afford a home to use them in.

Some sad people fill void in their life temporarily by buying new tech every time it comes out. Not saying it's the guy above you, but that's just how it is. They also tend to justify their purchase by saying that everyone else should buy what they bought because everything else is inferior.

 

[ShagnWagn]

I understand what you are trying to say but what you actually wrote doesn't make sense, also what you are actually trying to say is also nonsense.


Some sad people fill void in their life temporarily by buying new tech every time it comes out. Not saying it's the guy above you, but that's just how it is. They also tend to justify their purchase by saying that everyone else should buy what they bought because everything else is inferior.

Just because you don't understand video card generations (along with other components such as CPUs) doesn't mean everyone else doesn't. Technology is typically released in stages. This is sometimes referred to the tick-tock cycle. Anyway, I'm moving on.