Today it was reported that EVGA is exiting the GPU business. At STH, we normally cover higher-end GPUs and CPUs. Still, at STH we have reviewed quite a few NVIDIA GPUs over the years and even had our favorite Xeon 5500/5600 motherboard in our EVGA SR-X Classified First Look. This is a big enough industry event that we are going to cover it briefly on a Friday afternoon.
EVGA Exits the GPU Business in a Split from NVIDIA
Steve at GamersNexus covers the split here:
JayzTwoCents also covers it here:
EVGA closely held the news to those two YouTube channels and organized the release of the information.
For our readers that do not want to spend the time watching 20+ minute videos, the quick summary:
- EVGA did well on the NVIDIA GeForce RTX 2000 and NVIDIA GeForce RTX 3000 series until each generation’s mining boom hurt sales and caused losses.
- EVGA felt like NVIDIA was restricting its board designs in various ways, including setting suggested sales prices.
- EVGA has somewhere around 80% of its revenue from GPU sales, but it is not its highest margin line.
- EVGA will stop selling GPUs after its current supplies run out with the RTX 3000 series, and will honor warranties. The company will continue without these NVIDIA GeForce sales.
- At this point, EVGA is not picking up AMD or Intel GPUs.
There is more to the story, but those are probably the key points.
I wanted to just provide my personal perspective here, since we deal mostly with a market segment that NVIDIA controls almost completely.
- First off, I do not think that this is going to hurt NVIDIA sales. Sales may be hurt by the Ethereum merge and mining sales, but if folks want NVIDIA GPUs, they will just buy them from another source.
- Second, I think for the consumer market, NVIDIA still needs partners. In the data center market and the high-end workstation market, chassis and systems are standardized to a degree they are not on the consumer side. As a result, I think that NVIDIA needs partners, even if they are not EVGA. NVIDIA may make a higher percentage of cards with the new generations and their FE cards. Most of the value in a consumer GPU is the chip. Other parts have some value (software, aesthetics, cooling, and more) but NVIDIA holds the key value driver in all of these products.
- Third, I think that with the end of the current mining boom, the market for consumer GPUs will contract and so having fewer players may be a consequence.
- Fourth, I wonder how much the PSU business will sag due to the loss of brand recognition if the GPU business at EVGA is shuttered.
- Fifth, and most importantly, Intel needs to buy EVGA. AMD could do well to turn EVGA to its brand, but Intel needs a strong AIB to launch a second-generation dGPU. If I were Intel’s business development team, I would first try to secure exclusive rights. If that did not work, I would find a way to purchase the business. Intel is exiting businesses, so bringing a PSU business would be questionable.
From the videos, EVGA says it is not closing up shop. My sense is it either needs to go AMD, Intel, or something more interesting like Biren transitioning into a workstation business. Shrinking a business is not great for employee morale, and EVGA’s brand has been around so long that it needs to build a business to replace it.
I hope that something changes with this. Likely going back to NVIDIA is not the option at this point, but EVGA needs to transition its business. Intel announcing EVGA as a partner for the next generation would help that business. Still, this feels like a situation that is not at the right long-term conclusion as it has been presented today.
Our last EVGA GPU story was actually How I Got Scammed on an EVGA NVIDIA GeForce RTX 3090.
Although we still use many EVGA PSUs, it is sad to think that this will likely be the last piece that we do on an EVGA product unless something changes.