After Losing Half Its Value, NVIDIA Faces Reckoning

TekRok

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A bit too much butt hurt in this thread, thats the gist I am getting. No one is forcing anyone to buy the new RTX, just like no one is forcing anyone to get the new iphone or samsung phone, you guys create these issues in your head. The CEO is the not one that makes the pricing. There is a board, marketing, hardware, and development departments that ultimately decide the cost of the item. Yea I agree the RTX is overkill in terms of price for what it offers, but look at the competition, there isnt really any. You should know this by now.

Another point about their stock price, I trade stocks and follow the financial news on a daily basis. You dont have to be a genius to understand that tech is always the fastest to grow and fastest to fall. All tech is down period. Its been getting hammered like crazy the last 3+ months. People tend to pull money out of tech equities first, thats just how it works.
The fact that tech has been getting hammered, the release of the RTX series could not have come at a worst time.
 

Chris_B

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The only way raytracing takes hold is if people adopt it, and the current cards capable of leveraging it are beyond what most people will spend.


And if nvidia throw enough money at devs under the table to make use of it.
 

c3k

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The stock price at $289 (or so): upon what basis was that calculated? For it to drop in half, I suspect the stock valuation did not have a physical component at that level. So much of the stock prices these days are based on psychological factors by the market players and very little on actual physical plant. This is what happens when the market finds out that your new card doesn't really work (chicken and egg: sure, RTX sounds cool, but there's nothing that really uses it and, those that do, have frames dropped below what is expected); when it is priced insanely high; when more and more folks find out that you've achieved market share and destroyed competitors by being douche-like; Geforce Gaming (or whatever that intrusive software was called); and the whole NDA/do what we want or you're out (thanks for pointing that out, Kyle).

So, your stock was based on psychological factors and you are no longer considered a "good player". That's what happens. Once a bunch of folks quit your team, the stock craters and everyone runs.
 

Eymar

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It is interesting that bitcoin inflation seems to be hurting Nvidia more than AMD, where it was the reverse perception a few months back. The Bitcoin mess just adds a bad precedence to any growth story that Nvidia will pitch to investors. Any finance site can just point to bitcoin history to put doubt on any future Nvidia growth. Ex. "Tensor core performance will be key for future sales growth" - Nvidia, some media/finance site can just say Nvidia will face fierce competition from ASIC competitors as they did during Bitcoin mania.
 

Rebel44

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In early 2019 (likely end of Q1) Nvidia will also lose +-80K sales (per Q) of Nvidia Drive PX 2 when Tesla switches to its own ASIC for Autopilot. This will mean a loss of revenue of around $200M per Q.
 

ChadD

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It is interesting that bitcoin inflation seems to be hurting Nvidia more than AMD, where it was the reverse perception a few months back. The Bitcoin mess just adds a bad precedence to any growth story that Nvidia will pitch to investors. Any finance site can just point to bitcoin history to put doubt on any future Nvidia growth. Ex. "Tensor core performance will be key for future sales growth" - Nvidia, some media/finance site can just say Nvidia will face fierce competition from ASIC competitors as they did during Bitcoin mania.

AMD has had some of its other core products turn investor heads. Ryzen is a big part of what is coming. They are known to have PS5 and MS next console locked down. They also have people buzzing about chipletts.

One of the big potential upsides of the chipy stuffs could well be easy on board custom ASICs. Ryzen + a GPU isn't the only interesting thing going for AMD for all those markets Nvidia has had the early lead in. (AI / Self Drive / Server computation) The prospect of everything from console chips to big iron server AI chips... shipping with Ryzens + Navis + who knows what ASIC attached. Has a lot of investors pretty high on AMDs next few years. (we'll see... ya Tech stocks are complete speculation most of the time)
 
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You all DO realize the entire market tanked hard in a similar pattern to NVDA, right?

More [H] sensationalism...

They are all too busy rushing out and buying the exciting new AMD RX 590, it's beastly performance is only matched by it's beastly power consumption.
 

sleepybp

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Nvidia is smart and knows what they are doing.
Most of the sheep who spend $1000+ on GPU have already bought turing.
Next they will release the "mid range" and give us 75% of what the sheep got for $600.
The mid range release will restore the volume sales to meet target revenue.
 

Mega6

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The tech market is in a slump because all the new stuff is too damn expensive. Only schmucks will pay for it and you don't build a business model based on schmucks.
No. It’s
1) bitcoin GPUs sales hangover
2) worries about future earnings growth
3) global economy
4) China trade
5) Hawai arrest

And anything else in the headlines..
RTX isn’t in the financials yet but it will hit next quarter.
 

gene0915

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I stopped buying their products only because of their piss poor support of Linux. Hope Nvidia goes bankrupt! And I read an article on here a few weeks ago about how the CEO was downplaying how the crypto-crash was going to impact their bottom line. HA! Looks like those chickens are coming home to roost!
 

N4CR

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Vega would be even cheaper, and work better for that purpose ;)
Lol at the usual review ' turn the power up' approach perhaps and you get free games to boot. 1025mv makes it a poor kiln for me though, even my 290x dcu2 was louder on baverage and I have a ref Vega.. All down to the user of course.
Mitx 250-300w+ card sounds like quite the thermal challenge all things considered.
 

HockeyJon

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Or people irrationally overinflated the price and it’s coming back to normal. I mean it was less than $15 5 years ago, so if you want to write this headline another way, it’s “NVIDIA surges in enterprise value by a factor of 10 in 5 years!!”. The company isn’t suddenly unhealthy. Yes, crypto is basically dead, and with that, insane expectations. They’re still making money and leading in a lot of key areas.
 

ShuttleLuv

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Untrustworthy 2080ti and Crypto Downturn will do that for sure. Plus a pessimistic economic outlook forming.
 

Lakados

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I suspect this is the real reason for insane 2080x prices is they are trying to prop up falling income elsewhere.
Not sure failing is the right word, but the costs are probably higher because they new they would have poor yields off the start and they know AMD has nothing that can touch their high end cards so they charged what they thought they could get away with and it seems to be working for the most part. Once yields improve and AMD gets their new cards out they will adjust their pricing accordingly, probably a $200 drop.
 

iamjanco

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Reported by ExtremeTech last month: "...it’s the company’s inventory build that has analysts worried. Nvidia is currently holding $1.417B in product, up from $796M in January 2018 and $1.09B in Q2 2018. Nvidia blames this problem entirely on the decline of the cryptography market and has stated it will ship no new midrange cards to market through Q4 to give the channel time to work through the excess inventory build-up."

Not at those prices

It could be interesting to see how much RTX 20xx product they're stuck with a year from now. If they don't get a handle on the Space Invaders problem, it's possible we could see what amounts to a new series of paper weights being sold on eBay right along side their fancy NVIDIA rulers:

space-invaders.jpg
 

Dirty Butler

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You all DO realize the entire market tanked hard in a similar pattern to NVDA, right?

More [H] sensationalism...

Funny, the company I work for lost about %10 value during the slump, it sure as hell didn’t lose half it’s value.
 

funkydmunky

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Nvidia is smart and knows what they are doing.
Most of the sheep who spend $1000+ on GPU have already bought turing.
Next they will release the "mid range" and give us 75% of what the sheep got for $600.
The mid range release will restore the volume sales to meet target revenue.
I suspect you are correct but I have to ask myself what is this mainstream line-up of Nvidia going to be?
It will have none of the advanced RTX special sauce, or at best be severely limited. So far we are looking at a 1060 with faster memory.
 

Nobu

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Funny, the company I work for lost about %10 value during the slump, it sure as hell didn’t lose half it’s value.
You also have to consider their stock was up about 50% YoY from $180 to $280. Considering it's only down about 16% from $180, it's not doing that much worse than other stocks...but it's not something to be real proud of, either.
 

power666

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The revenue side of thing is likely impacted by the slump in crypto as many have already pointed out. A slump in profits is a bit more complex as the consumer GPU side fo things doesn't have that large of margins. Rather nVidia's profits are driven by high end designs like top of the line Quadros and Teslas. In this area, the GV100 still reigns supreme today after getting a minor clock speed and they offer a higher memory capacity model (but at a higher price). Not a terrible thing but the competition in this secure isn't sitting around. Other factors like tariffs are impacting sales along with a lukewarm reception to the new Turing consumer models.

Rather than face competition from the usual suspects of AMD and Intel, both Amazon and Google, two of their big prospective customers, have started to develop their own AI chips independent of nVidia. Facebook and Microsoft also have their own internal AI chip efforts as well but reportedly not as far along. One of the reasons being cited is cost which nVidia isn't backing down from. (Other factors like power consumption matter as well but there is an initial in-house investment that has to be made and weighed against the costs of power/cooling using an alternative design.). The thing about these four companies is that they have/are in the process of transforming themselves from nVidia customers to nVidia competitors. Companies like Google have mentioned the possibility of selling their AI chips to 3rd parties for usage outside of Google's own cloud efforts (currently Amazon and MS efforts will be publicly available as part of their cloud offerings). This means competition for other lucrative AI and inference projects for say government contracts.

In addition to those cloud efforts, those companies appear to leveraging their own chip works for things like automatous car projects. While I personally feel that this technology is still on the horizon, doing everything in-house leaves little space on the road for nVidia's Tegra lineup. The one thing nVidia has going here is that they have strong relationships with car manufacturers though those customers are starting to hurt due the recent wave of tariffs themselves. As such sales outlook in this segment is bad both short term and long term. Something needs to turn around here and some variables are completely out of nVidia's control.

Other technology changes coming down the road may also impact nVidia in terms of how they stand technology wise. PCIe 4.0 is here now in high end POWER servers which nVidia has partnered with IBM on but there is no PCIe 4.0 support for it (they do use nvLink but it is kinda weird that PCIe 4.0 isn't an option, just PCIe 3.0). AMD will have PCIe 4.0 based consumer systems next year and possibly their own high speed link between their CPU and GPUs on desktops (still using PCIe 16x physical slots). HDMI 2.1 is set to be prominently show off at CES in a few weeks but nVidia doesn't have any cards capable of it. They desperately need to move onto a new process or migrate to chiplets (which they have hinted at) due to the massive die sizes they're using. 754 mm^2 for high end consumer part, even at $1200, is kinda crazy. These are more short term issues I don't see these lasting but could remain throughout most of 2019.
 
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Ranger101

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A bit too much butt hurt in this thread, thats the gist I am getting. No one is forcing anyone to buy the new RTX, just like no one is forcing anyone to get the new iphone or samsung phone, you guys create these issues in your head. The CEO is the not one that makes the pricing. There is a board, marketing, hardware, and development departments that ultimately decide the cost of the item. Yea I agree the RTX is overkill in terms of price for what it offers, but look at the competition, there isnt really any. You should know this by now.

Another point about their stock price, I trade stocks and follow the financial news on a daily basis. You dont have to be a genius to understand that tech is always the fastest to grow and fastest to fall. All tech is down period. Its been getting hammered like crazy the last 3+ months. People tend to pull money out of tech equities first, thats just how it works.
The fact that tech has been getting hammered, the release of the RTX series could not have come at a worst time.
100% ... A dedicated "RTX Whining Thread" might be a good idea....
 
D

Deleted member 243478

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People need to calm the hell down. Remember without NVIDIA we would have utter crap GPUs from AMD and thats it.

Yes their cards are expensive but you can charge what you want when there is no competition on the market or drive to make new products. They could have skipped this generation completely if they wanted to and stuck with Pascal for another 2yrs at full price and kept milking it. AMD are just so far behind.

At the end of the day dont buy it if you think its a rip off. I paid $1500 for my Titan XP but in hindsight im going to say i am very happy with the purchase. 2yrs+ now and still got tons of life in it.
 

lefizz

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The way I see it Nvidia are like intel were just before ryzen dropped. Lazy and milking their customers for small generational gains. Hopefully AMD can, with their Navi architecture, produce some serious competition and start a new arms race. Even if you want to buy an intel cpu today you're getting a hell of a lot more thanks to the competition AMD has brought.
 

leviathon

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Nvidia is too focused on being the best that they have forgotten where the market is. Hint Nvidia, its not in the high end gpu market.
 
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MV75

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Hope they enjoyed that miner money while screwing over their core consumer. All I can think of right now is like in the simpsons (betterthantv.com) the guy is pulling stock off what looks like a toilet roll holder.
 

Stimpy88

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Couldn't happen to more greedy and nasty company. Too bad, so sad, bye bye.

nGreedia could do with a shot of empathy for it's core customers, and half the price of these RTX cards. Then you would see attitudes towards them change, and profits go up. I personally refuse to pay over $600 for a POS card that can't even do the headline act on the box, and I suspect many others feel the same.

Come on AMD, get some RT cores in your chips, and price them fairly, as nGreedia would rather go bust than do the right thing.
 
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Jza

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Awesome products from AMD isn't Lisa Su's only card up her sleeve to battle NGREEDIA and Intel. My sources say she's been working with Clarence Beeks to undermine NVIDIA's value at Wall Street. This footage was captured by secret [H] operatives. It shows Beeks checking it with who most undoubtedly is Lisa Su during operation "Radeon".

Rumor has it the women seen eavesdropping is an agent from disgraced would be high-end 3D accelerator player Matrox, in their own failed operation to make a comeback known as "Parhelia".
 
D

Deleted member 222586

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NVIDIA hasn’t been doing well in the stock market lately, and while that isn’t exactly a secret, several stories have emerged this week to elaborate on how bad the numbers have become. TechCrunch pointed out a few days ago that NVIDIA’s stock has “dropped from a closing price of $289.36 on October 1 to today’s opening of $148.42, a decline of 48.8 percent,” which is pretty shocking. Management, however, believes things will rebound with the help of Turing, ray-traced gaming, rendering, and other growth opportunities.

It takes a lot for a company to lose nearly half its value in such a short period of time, but Nvidia is proving that an otherwise strong technology business can disappear in the blink of an eye. The company faces an almost perfect barrage of headwinds to its core products that is stalling its plans for long-term chip domination. First and foremost, the huge sales of its chips into the crypto space have dried up as crypto prices have crashed in recent months.

Which is hilarious considering that AMD hasn't been so behind regarding their gpus since forever. NVIDIA better do something quick before AMD releases something worth buying. They are losing markets quickly, and being as specialized as they are... they better get their act together.

You're confusing market capitalization and profit. Nvidia doesn't lose money when the stock price goes down.

Also, they can't make 2080TIs for $200...why would they ever want to sell them for that?

But shareholders and execs do.
 
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well, considering how the market works, the same bunch of people whom jacked the price up are also the same bunch of people whom dropped the price. But they all made a good buck. That part of the market is not possible to track for free but if you bought into the system you can see whom made what...

sucks to be retail investors though..
 

Stimpy88

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A bit too much butt hurt in this thread, thats the gist I am getting. No one is forcing anyone to buy the new RTX, just like no one is forcing anyone to get the new iphone or samsung phone, you guys create these issues in your head. The CEO is the not one that makes the pricing. There is a board, marketing, hardware, and development departments that ultimately decide the cost of the item. Yea I agree the RTX is overkill in terms of price for what it offers, but look at the competition, there isnt really any. You should know this by now.

Another point about their stock price, I trade stocks and follow the financial news on a daily basis. You dont have to be a genius to understand that tech is always the fastest to grow and fastest to fall. All tech is down period. Its been getting hammered like crazy the last 3+ months. People tend to pull money out of tech equities first, thats just how it works.
The fact that tech has been getting hammered, the release of the RTX series could not have come at a worst time.

Maybe you should look at the bigger picture here. I, for one, do not like the idea of a monopoly setting sky-high prices (doubling them) which will achieve nothing but to shrink the PC games market, and stifle development of the platform. But if that's your bag, and you love console gaming, then all power to you. We all understand the "no competition" thing, but it's still a bad business decision to double the prices of your product, over hype and underdeliver said product, and simply expect everyone to love it, let alone happily throw their money at you.

And regarding your stock market opinion, it's invalid, as the stock declined after the release of the RTX line. Share prices briefly rose during and after the launch, but started declining soon after. So it's simply not true that they released the cards in to an already falling market. You are right if you mean that in hindsight (always 20-20) that nGreedia released at a bad time, but the bad time was a couple of weeks after the press event.

My opinion, no more valid than your own perhaps, is that the market reacted to nGreedias bad press, and investor confidence lowered due to that. Add to that the weaker than expected demand after the initial launch, as well as the so called "flooded inventory" of previous gen chips, the stories in the press from OEMs which were disallowed to send the old nGreedia chips back. Factor that, and include the bad press from multiple RTX card failures in the press, as well as your comment of general tech company stock trends, and we arrive at this situation.
 
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vegeta535

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I stopped buying their products only because of their piss poor support of Linux. Hope Nvidia goes bankrupt! And I read an article on here a few weeks ago about how the CEO was downplaying how the crypto-crash was going to impact their bottom line. HA! Looks like those chickens are coming home to roost!
Why do you want less competitions? With Nvidia out of the market it will just be AMD left. You really think AMD won't bend people over? It would proabably be worse then anything Nvidia does cause AMD will be the sole GPU maker.
 
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