NVIDIA Blames AMD for Excess GPU Inventory

Megalith

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NVIDIA CEO Jensen Huang suggests there may be others to blame for his company’s $700 million revenue miss and unexpected increase in midrange GPU inventory: in his latest earnings call, Huang pointed out there was “more than 12 weeks of inventory between us and the other brand,” implying AMD was a factor. “Huang was asked how cryptocurrency, which accounted for only 10% of its quarterly revenue, expanded to one entire quarter’s worth of inventory. He stated this was because the channel also included AMD’s inventory.”

He explained that since NVIDIA’s GTX 1080 is the top-selling GPU and AMD’s RX 580 is number 24, the ratio of GTX 1080s to RX 580s in the channel inventory is 90:10. If AMD suddenly injects RX 580 GPUs into the channel and changes the inventory ratio to 50:50, it would create excess inventory, which is difficult to sell. The sudden rise in GPU inventory because of declines in crypto-related GPU demand suggests that this instance is a one-off and not affecting its long-term growth opportunities.
 
His statement makes no sense. If AMD cut prices to sell their cards and he didn't I could understand how AMD would cause NVIDIA to have excess inventory, but that doesn't seem to be the case as AMD also has excess inventory.

I've got a hint for NVIDIA: cut prices and product will sell.
 
Hahahaha douche bag
NVIDIA CEO Jensen Huang suggests there may be others to blame for his company’s $700 million revenue miss and unexpected increase in midrange GPU inventory: in his latest earnings call, Huang pointed out there was “more than 12 weeks of inventory between us and the other brand,” implying AMD was a factor. “Huang was asked how cryptocurrency, which accounted for only 10% of its quarterly revenue, expanded to one entire quarter’s worth of inventory. He stated this was because the channel also included AMD’s inventory.”

He explained that since NVIDIA’s GTX 1080 is the top-selling GPU and AMD’s RX 580 is number 24, the ratio of GTX 1080s to RX 580s in the channel inventory is 90:10. If AMD suddenly injects RX 580 GPUs into the channel and changes the inventory ratio to 50:50, it would create excess inventory, which is difficult to sell. The sudden rise in GPU inventory because of declines in crypto-related GPU demand suggests that this instance is a one-off and not affecting its long-term growth opportunities.
 
The truth is the crypto boom made up vastly more than 10% of their sales, and they lied to their investors that crypto was of minimal impact the last ~ year ---- and now the chickens have come home to roost.
 
Well he can't give the "real" reason because that would be bad for shareholder, you guys should know that by now.
They've no choice but to say "truths" that will make the action go up. Dare him say they made bad choices and see the action go down...

We went thru this exercise with Elon musk and his blunt... different but similar example.
 
Give me the discounts, I'm not even planing to buy anything but with a nice discount who knows what will happen.
 
There is just about no way excess RX580 inventory is going to have any effect whatsoever on GTX1080 hardware sales. While the 580 is very strong for what it does and how much it costs, those cards are an entirely different class of product. The people seriously looking at 1080's are not going to settle for 580's.
 
Uh, I do not understand his explanation at all. He is implying that sales of product A will stall if product B gets more inventory??? That's not how sales work...

Well, unless he is saying he can only sell his product if there is a shortage of competitor products in the market? I could understand that, but it doesn't sound like something a CEO would say...
 
Translation: our products are vastly over priced and now we have competition.

Technically what he said is accurate, if not wholly true. AMD is the reason Ngreedia GPUs aren't flying off the shelves.
 
If the GPU-makers want to do some sort of "cash for clunkers" thing to encourage folks to flush out that mid-range GPU inventory, maybe that could help keep modest gamers from buying dumped mining cards. Free games is nice and all, but maybe they'd like to offer me a trade-in on my htpc's gtx460 (so I get more hardware accellerated codec support).
 
The truth is the crypto boom made up vastly more than 10% of their sales, and they lied to their investors that crypto was of minimal impact the last ~ year ---- and now the chickens have come home to roost.

To be honest, I would almost raise the question of fraud regarding their earnings reporting to investors regarding the ratio of crypto to actual gaming purchases. They underreported the significance of sales garnered from crypto, and based all of their production timetables on crytpo forecast. They 100% didn't recognize that crypto was going to go belly up, and they invested almost 1 billion dollars into forecasts that were based on crypto demand. To say that crypto made up 10% of their graphics card sales is misleading at best, and in my opinion, is a clear cut case of deception to their investors and shareholders.
 
It seems to me that, independent of the product involved,blaming your competition for your own company's lack of performance strikes of poor leadership.
They are, after all, your competition. Ergo, they're supposed to be competing with you...no?
If they handed you everything you needed on a silver platter then they wouldn't be your competition - they'd be your partner.

I guess I'm missing something...
 
Well, I bought a 1080 and a 1070Ti in the last couple months... so he should be happy..

Oh, wait, I bought them off of eBay for less than 1/2 of of what they go for new because I refuse to spend any more than that on a video card.

New video card prices are stupid high. Maybe if they brought the prices down to a sane level then people would start buying them.
 
He explained that since NVIDIA’s GTX 1080 is the top-selling GPU and AMD’s RX 580 is number 24, the ratio of GTX 1080s to RX 580s in the channel inventory is 90:10. If AMD suddenly injects RX 580 GPUs into the channel and changes the inventory ratio to 50:50, it would create excess inventory, which is difficult to sell. The sudden rise in GPU inventory because of declines in crypto-related GPU demand suggests that this instance is a one-off and not affecting its long-term growth opportunities.

Uh, ok. Say Mr. Huang when did the gtx 1080 (not 1060?) get released? May 2016. When was the 580 released? April 2017. Nevermind you're comparing a $500+ card to a $275 ( or less lately if we count sale prices for both cards). If he meant the 1060, well they haven't been on sale until the last 2-3 weeks in any serious numbers compared to the 580 cards.
 
Gamers Nexus recent video made light of this and said it's funny how Nvidia claims the bubble was not significant to their revenue, but as soon as it burst their quarterly revenue nose dived.

I wouldn't expect "truth" to be something Nvidia knows how to do.
 
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