GPU and Motherboard Makers Face Oversupply in 2019

Discussion in 'HardForum Tech News' started by AlphaAtlas, Nov 19, 2018.

  1. AlphaAtlas

    AlphaAtlas [H]ard|Gawd Staff Member

    Messages:
    1,713
    Joined:
    Mar 3, 2018
    According to Digitimes' "industry sources," business prospects look bleak for DIY motherboard and GPU manufacturers in the first half of 2019. Thanks to the "sustained chill in the crypto mining sector, the supply shortages of Intel CPUs, and lackluster buying sentiment at terminal markets amid the US-China trade war," inventory levels are much higher than usual, and profits are down. Asus's third quarter earnings, for example, are down 43% year on year, and Gigabyte's 2018 graphics card shipments are expected to drop by nearly a million units to 3.65 million. Whether this translates to lower (or higher) prices on shelves remains to be seen, but these components likely won't suffer from the stock shortages that some specific CPUs and GPUs are facing now. Interestingly, the same sources postulate that Nvidia and Intel are likely to "raise chip prices to maintain profitablity."

    Revenue prospects for the fourth quarter are further dimmed by lingering sluggish demand from the DIY market, poor growth momentum in the China market and insignificant performance upgrades for Nvidia's new GPU platforms bearing relatively high price tags, the sources continued. Makers of motherboards and graphic cars are expected to face tough challenges in the first quarter of 2019, when makers with higher graphic card shipment ratios, such as Gigabyte and TUL, may see their profitability halved on quarter due to high comparison bases of a year earlier. This, coupled with Nvidia and Intel likely to raise their chip prices to maintain profitability, may drive makers into a bleak profitability period starting in 2019.
     
  2. cdr_74_premium

    cdr_74_premium [H]ard|Gawd

    Messages:
    1,579
    Joined:
    Oct 20, 2010
    Nvidia will have a slightly easier time raising prices, but Intel? LOL.
     
    wyqtor likes this.
  3. Glock24

    Glock24 [H]Lite

    Messages:
    123
    Joined:
    Jan 2, 2005
    Both Intel and nVidia products are overpriced. Raising prices even more won't help them muchmuch I think. They'll just create more unsold inventory.
     
    ManofGod, HoffY, Blown Cap and 16 others like this.
  4. trick_m0nkey

    trick_m0nkey Moderator Staff Member

    Messages:
    3,979
    Joined:
    Oct 11, 2005
  5. Cmdrmonkey

    Cmdrmonkey Gawd

    Messages:
    1,013
    Joined:
    Jul 19, 2004
    Kinda hard to sell new GPUs when you can pick up a used 1070 for $225 at the moment because the miners are dumping them in massive quantities. And that's a card that will max out most games at 1440p. And nVidia isn't doing themselves any favors with the ridiculous pricing on the RTX cards.
     
  6. umeng2002

    umeng2002 Gawd

    Messages:
    923
    Joined:
    May 23, 2008
    The prices are too damn high... GPUs, RAM, and Intel CPUs.
     
    HoffY, Vercinaigh, DrezKill and 4 others like this.
  7. Nukester

    Nukester [H]ard|Gawd

    Messages:
    1,429
    Joined:
    Mar 21, 2016
    I have upgraded my nVidia card just about every product cycle... I skipped this one... Does this tell you something? Prices... Fuck them.
     
    Bcc335, Reality, kirbyrj and 12 others like this.
  8. HockeyJon

    HockeyJon [H]ard|Gawd

    Messages:
    1,067
    Joined:
    Dec 14, 2014
    Which is amazing, because I’ve seen GPU prices spike this week in Canada at a time when I would be expecting clearance sales all over the place.
     
    Reality, Vercinaigh, AlphaQup and 3 others like this.
  9. nEo717

    nEo717 Limp Gawd

    Messages:
    282
    Joined:
    Jun 2, 2017
    Agree... possible this will help AMD, even (AMD) in GPU market if we keep seeing Vega 64 in $300's (performance/price level that has high demand). 2019 is going to be interesting for the consumer. Hopefully by mid 2019 AMD has strong GPU refresh and maintains at CPU level (in hopes of pushing nVidia and Intel to better pricing).
     
    Sulphademus likes this.
  10. DukenukemX

    DukenukemX [H]ardness Supreme

    Messages:
    4,391
    Joined:
    Jan 30, 2005
    The stuff isn't exactly advanced. The R9 290's, 390's, GTX 970's, 980's, and the modern RX 470, 480, 580, 590, GTX 1060's are all within the same performance range. Not much of a price difference either, especially if you consider how many years now these cards have been in the market. Same situation with CPU's, I mean yea AMD Ryzen's are cheaper but any Sandy Bridge or higher Intel CPU will do just fine in most applications. Motherboards haven't been improving with some of them still claiming to have more VRMs than they actually have. Nobody is trying to put better audio or networking components other than the $100+ range boards and it doesn't justify the price.
     
  11. jlbenedict

    jlbenedict [H]ard|Gawd

    Messages:
    1,314
    Joined:
    May 22, 2005
    oh well.. shouldn't have got greedy
     
    Sedriss, Krenum, Vercinaigh and 7 others like this.
  12. N4CR

    N4CR 2[H]4U

    Messages:
    3,710
    Joined:
    Oct 17, 2011
    And those 'industry sources' forgot that the main reason people were not upgrading in past was shitty DDR4 pricing.
    It's come down now quite a bit to where it's not so bad and I'd expect we'll see (as people are becoming aware of that) an upsurge in DIY.
     
  13. Armenius

    Armenius I Drive Myself to the [H]ospital

    Messages:
    17,478
    Joined:
    Jan 28, 2014
    Aren't prices supposed to go down when demand is down, not up? Shouldn't have modified your business model based on the highly volatile cryptocurrency market when those sales were never going to be sustainable.

    When I can buy a good 32GB DDR4 kit for <= $300 I'll be more than happy to upgrade my PC in the near future.
     
    elation, Sedriss, deton8 and 7 others like this.
  14. cyclone3d

    cyclone3d [H]ardForum Junkie

    Messages:
    12,981
    Joined:
    Aug 16, 2004
    Pretty much this. I picked up a 1070Ti and a 1080 when the miners started dumping them. I only game at 1200p and figure the 1080 will last me a couple more years at least. The 1070Ti is being used in a computer for my kids.
     
  15. cyclone3d

    cyclone3d [H]ardForum Junkie

    Messages:
    12,981
    Joined:
    Aug 16, 2004
    Last time this happened, Intel pulled dirty illegal tricks to keep AMD from making money (Pentium IV and Athlon 64 days).

    Some people just never learn.. Intel and apparently now nVidia.
     
  16. N4CR

    N4CR 2[H]4U

    Messages:
    3,710
    Joined:
    Oct 17, 2011
    The Hynix stuff is sub $300 already. Sniper X, Dominator etc cheapest I saw was $264 for a 16gbx2 kit.
    B-die or better and you're going to be waiting longer, maybe when DDR5 is out for a little while.

    And lol, tell nvidia that about pricing.
    Seems to have pushed the 1080Ti up to ridiculous pricing level now, which I find hilarious. Retailers can't help gouging can they..
     
    Armenius likes this.
  17. Master_shake_

    Master_shake_ [H]ardForum Junkie

    Messages:
    8,663
    Joined:
    Apr 9, 2012
    Fire sale!

    As if that'd ever happen.
     
  18. BloodyIron

    BloodyIron 2[H]4U

    Messages:
    3,443
    Joined:
    Jul 11, 2005
    Please don't take my mini-ITX format away from me :( it's finally awesome!
     
  19. nomas

    nomas Limp Gawd

    Messages:
    246
    Joined:
    Apr 19, 2015
    Sky-high DDR4 pricing was what held me back from upgrading to Ryzen1/2. It has come down recently, but with Zen2 around the corner, I've decided to wait, especially since CPU improvement has been anemic over the last 10 yrs. Only 50-100% faster cumulatively across multiple generations??!?!? Not exciting enough.

    While gaming in 4K my OC'd FX(s) with 1080ti can still deliver what I consider sufficient frame rates, i.e. 30-60, in GTA V and Witcher 3 at max or near-max graphics settings.
     
  20. c3k

    c3k 2[H]4U

    Messages:
    2,097
    Joined:
    Sep 8, 2007
    ^^^
    THIS.

    Check the sig. My intel 4790k rig (GTX970) is begging for an upgrade. It's driving dual 1920x1200s. There's not enough performance increase to warrant the high prices of the newer GPUs. Sure, that's because of my monitor resolution, but that's what it is.

    As for CPU, well, I'm so pleased with the 2700x build I just did that I'll wait for Ryzen2 to be released and probably use that to replace the 4790k. (Assuming DDR prices don't rise again. Sigh.) I'll need a new mobo, cpu, and ram for that. The rest of the machine will stay as-is.

    And, that's it for me for the upgrade cycle for the next 6-9 months. Or more.
     
    N4CR and DukenukemX like this.
  21. GoodBoy

    GoodBoy [H]ard|Gawd

    Messages:
    1,338
    Joined:
    Nov 29, 2004
    nVidia already raised prices...

    We speculated a few months ago that the high RTX prices was due to overstock on 1080 family gpu's due to the mining market crash... seems obvious as they knew this was coming.

    I've read somewhere that the 1080ti stock is getting low, hence they're still selling for more than $800, but I have no idea on 1070 gpu stock.
     
    Marees likes this.
  22. Teenyman45

    Teenyman45 2[H]4U

    Messages:
    2,273
    Joined:
    Nov 29, 2010
    So supply and demand curves under classical economics say that when supply exceeds demand, prices must fall until the two curves meet. Since Nvidia has near monopoly power this now seems to mean that when demand falls Nvidia can and will still raise prices to further squeeze customers who, for whatever reason, still need to buy.

    And 1070s and 1080s (not ti's) were both considered exceptionally overpriced on launch due to the bogus founders edition surcharge. Only reason ti's somewhat escaped the ill will is that Nvidia managed to condition people that "Titan" branded cards should be $1,000 or more with ti's being the "affordable" option.
     
    Marees likes this.
  23. Joust

    Joust 2[H]4U

    Messages:
    2,745
    Joined:
    Nov 30, 2017
    It just means that GPUs are more inelastic than other goods. Not as price-sensitive.
     
  24. jlbenedict

    jlbenedict [H]ard|Gawd

    Messages:
    1,314
    Joined:
    May 22, 2005
    "classical economics" doesn't seem to apply when there are only 1 or 2 players in the game
     
    {NG}Fidel likes this.
  25. defaultluser

    defaultluser [H]ardForum Junkie

    Messages:
    12,368
    Joined:
    Jan 14, 2006
    Guess I'm waiting another year to buy.

    It's not like I play that many demanding games, So Nvidia can go fuck themselves.
     
    Dudhunter and jlbenedict like this.
  26. erek

    erek 2[H]4U

    Messages:
    2,492
    Joined:
    Dec 19, 2005
    "Bad Times for Motherboard and GPU Makers: Oversupply Will Lead to High Prices in 1H19"

    wouldn't oversupply mean lower prices? ... there's not enough demand, i don't know too many people who even want to buy a 20-series
     
  27. Tweak155

    Tweak155 Gawd

    Messages:
    569
    Joined:
    Jul 28, 2011
    Have you not been reading the news about the 2080 Ti's? Quite literal fire sales.
     
    N4CR, HockeyJon, Darth Kyrie and 6 others like this.
  28. Teenyman45

    Teenyman45 2[H]4U

    Messages:
    2,273
    Joined:
    Nov 29, 2010
    Except that outside of some enterprise customers who need vast arrays of GPUs replaced regularly or for some new just-in-time assebly project, they are incredibly elastic because when general retail consumers (including people who buy through a mass OEM builder like Dell) need/want an actual GPU rather than using the igp, most will buy for price rather than for the specific GPU specifications as long as what is perceived as more rationally affordable exceeds the specs of the game(s) to be played. Otherwise, people will just switch over to console gaming.
     
    Dudhunter likes this.
  29. Cipix

    Cipix n00b

    Messages:
    24
    Joined:
    Mar 4, 2018
    Lower.The.Fucking.Prices

    I find it funny that these companies would rather burn than lower prices.
     
    N4CR, Darth Kyrie, Vercinaigh and 4 others like this.
  30. jlbenedict

    jlbenedict [H]ard|Gawd

    Messages:
    1,314
    Joined:
    May 22, 2005
    Ego.. greed and too much confidence in the economy. (and hopes for another crypto boom)..
     
    Last edited: Nov 19, 2018
  31. Denpepe

    Denpepe [H]ard|Gawd

    Messages:
    1,054
    Joined:
    Oct 26, 2015
    I paid less for my i7 7820X then what the new i9 9900k are beeing sold at which is silly as the 9900k is a (albeit higher clocked) mainstream CPU.
     
    N4CR and {NG}Fidel like this.
  32. Joust

    Joust 2[H]4U

    Messages:
    2,745
    Joined:
    Nov 30, 2017
    I was only explaining how demand could stay the same while price increases. That there is a supply overage is another matter.
     
  33. Teenyman45

    Teenyman45 2[H]4U

    Messages:
    2,273
    Joined:
    Nov 29, 2010
    It's not another matter. It's the core point of the article that BECAUSE there is a supply overage Nvidia is planning on raising prices.
     
  34. THRESHIN

    THRESHIN 2[H]4U

    Messages:
    2,951
    Joined:
    Sep 29, 2002
    This was my thought too. Seems like raising the prices is the exact opposite of what you'd want to do.
     
  35. Joust

    Joust 2[H]4U

    Messages:
    2,745
    Joined:
    Nov 30, 2017
    It was a narrow statement. If I had bothered to read the article, admittedly, there would have been more context to your statement.
     
  36. erek

    erek 2[H]4U

    Messages:
    2,492
    Joined:
    Dec 19, 2005
    Also i forgot, and haven't paid especially close attention but how are the new tariffs impacting all of this?
     
  37. Grimlaking

    Grimlaking 2[H]4U

    Messages:
    2,792
    Joined:
    May 9, 2006
    HAHAHAHAHAHAHAHAHHAAHHAAHAHAHAHAHAHAHAHAHA!!!!

    I'm sorry but we all called this. That manufacturers that were price gouging the market because of bit coin mining would then be bit in the ass when the next generation came out because these same miners would start dumping video cards on the market to recoup costs. The problem is they arn't dumping to buy new cards but because card mining just isn't profitable enough.

    I have ZERO pity for Nvidia and others that gouged the market. They should have played smart but instead chose to rob peter to pay paul.
     
    N4CR and nEo717 like this.
  38. dgz

    dgz [H]ardness Supreme

    Messages:
    5,172
    Joined:
    Feb 15, 2010
    The industry is doubling down, eh? They need our money more than we need their products, that's for sure.
     
    HoffY, N4CR, Darth Kyrie and 7 others like this.
  39. DrBorg

    DrBorg Gawd

    Messages:
    555
    Joined:
    Jan 22, 2005
    If there's an oversupply, they can raise their prices all they want, but people Still won't buy them.

    That's the definition of oversupply.

    If they try to rape the buying public for higher prices, I think They'll be surprised.

    I read this as Good News. I didn't see the word AMD in there anywhere.

    Maybe that's the problem, and they are trying to deflect.

    I'm looking at a threadripper system, and a new AMD video card; after looking into the Nvidia fire problem, it made me realize I don't want to buy anything they engineered, regardless of what chips they have.

    I bought my last Nvidia card a long time ago; a 7800GTX, IIRC. No WinXP64 bit capture drivers, after they kept promising them.
    Fuck Nvidia.
     
    DocNo, c3k, Dunnlang and 1 other person like this.
  40. DNMock

    DNMock Limp Gawd

    Messages:
    399
    Joined:
    Apr 16, 2015
    I'm relatively certain Nvidia has hit the ceiling on GPU prices. Increasing prices more will do nothing but hurt their overall profitability.

    (Source: Some random dude on the internet with no clue what he is talking about)
     
    N4CR and Dunnlang like this.