GPU Demand Hits 20-year Low

The demand for graphics cards increased significantly during the pandemic as people spent more time at home playing games and some tried to mine Ethereum. However, with the world re-opening and Ethereum mining on GPUs declining, the demand for desktop discrete GPUs has dropped dramatically. In fact, shipments of discrete graphics cards hit a 20-year low in Q3 2022, according to data from Jon Peddie Research.

The industry shipped around 6.9 million standalone graphics boards for desktop PCs and a similar number of discrete GPUs for notebooks in Q3 2022. This is a decrease of 42% YoY and the lowest number of graphics cards shipped since at least 2005. Despite the decrease in demand for discrete graphics cards for desktops, Nvidia managed to maintain and strengthen its lead with an 86% market share. On the other hand, AMD's market share dropped to 10% and Intel captured 4% of the desktop discrete GPU market in just one quarter.

The decline in sales of GPU can be attributed to enthusiasts waiting for new graphics boards from Nvidia and AMD and PC makers trying to deplete stocks of CPUs with built-in graphics. The market of discrete GPUs collapsed by 42% YoY, while the whole market declined by 25.1% YoY. Jon Peddie Research notes that this decline in GPU sales in Q3 2022 is the most significant drop since the 2009 recession.

In conclusion, the decrease in demand for desktop discrete GPUs is a result of various factors including the decline of Ethereum mining and the wait for new graphics boards from Nvidia and AMD. Despite the decline, Nvidia managed to maintain and strengthen its lead in the market while Intel captured a significant market share in just one quarter. The decline in sales of GPU is a concerning trend for the industry and a reminder of the impact of the pandemic and other factors on the market.

This article is written by Gaurav Advit.