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Reference slide 5 from the cow's mouth[1] for this article's unlinked source. On first blush, the headline just looks like a consequence of quarterly revenue m

Reference slide 5 from the cow's mouth[1] for this article's unlinked source. On first blush, the headline just looks like a consequence of quarterly revenue miss when there's an implied floor to both cost of sales and operating expense in the face of elevated FX headwinds and substantial macro uncertainty. TSMC posted poor results last week, not dissimilar to Texas Instruments on Tuesday. Now we see Samsung join the club, and the trend is likely to be no different for Intel after market close today. All the while Nvidia has been trading in the $270-280 range on pure AI hype euphoria, completely oblivious to $2+ billion of deprecated Ampere architecture inventory glut, the export restrictions hammer that dropped last year when China sales alone accounted for over 21% of FY22 revenue, and more recently, AIB manufacturers informed that RTX 4070 production is being paused a mere 1 week after launch in an attempt to prevent inventory buildup, just to call out a few. [1] https://images.samsung.com/is/content/samsung/assets/global/ir/docs/2023_1Q_conference_eng.pdf https://images.samsung.com/is/content/samsung/assets/global/...

poisonborz 4y ago
Few events show how rotten the economic incentives are than this GPU scarcity: there are now massive inventories and over-production, huge demand, but prices are still sky high. Nvidia would rather destroy its inventory than go for pre-crypto prices. A massive amount of users stuck on 5-8 year old cards with still no good choices to upgrade. https://store.steampowered.com/hwsurvey/videocard/ https://store.steampowered.com/hwsurvey/videocard/
- ragazzina 4y ago
  Why are AMD or any other competition (I don't follow this sector very closely) not taking advantage of this and compete on price?
  - metaphor 4y ago
    The big picture I'm seeing is there's a game being played[1], but to your point, AMD did respond to RTX 4070 launch by dropping prices on RX 6800 series GPUs[2]. [1] https://scholarworks.umass.edu/econ_workingpaper/343/ https://scholarworks.umass.edu/econ_workingpaper/343/ [2] https://news.ycombinator.com/item?id=35663511 https://news.ycombinator.com/item?id=35663511
  - epolanski 4y ago
    Because gaming GPUs are not really profitable to AMD. As a reference, between 2008 and 2011 when ATI/AMD had the biggest technological lead over Nvidia's disaster architectures, even then when AMD was at near 50% market share it merely posted 19M of profits across 3 financial years! In the same time frame, despite terrible performances, Fermi architecture already going into the 400w consumption range, even then Nvidia posted billions of profits across the same time frame. AMD has simply stopped competing with Nvidia on prices, it's nonsense to them. Nowadays both Nvidia and AMD sell more GPUs to datacenters and super computers, where net margins are also twice as high than they do to gamers. Essentially both AMD and Nvidia are abandoning the gaming aspect of their hardware, stopped competing price-wise, instead they prefer both to sit on higher margins in the gaming market and focus on GPGPU aspect for business, research, automotive, AI, etc, etc, where the real money and growth is. The fact that this hardware is also able to crunch rendering calculations is more and more of a side effect.
    - hoseja 4y ago
      We need games that utilize local neural nets.
      - mepian 4y ago
        It seems that DLSS/XeSS is the only feasible application of local neural nets to games right now, everything else is too compute-hungry.
    - pdpi 4y ago
      AMD has notably cornered the console market with the Xbox One and Series X|S, PS4 and PS5. With the Steam Deck and now the Asus ROG Ally, they're starting to get themselves a position in the handheld market too.
      - themitigating 4y ago
        Is OEM integration profitable though? I would imagine Microsoft and Sony squeezed the best deal and maybe it will bring profit in later years when the research debt is paid
  - meltyness 4y ago
    Intel doesn't really have a competing product. AMD and Nvidia sell the same thing made at the same place in Taiwan. Nvidia dove in like 1998. AMD sold it's moat in like, 2005.
  - reissbaker 4y ago
    Contrary to what other posters are saying, I do think AMD is actually trying to compete; for example, they finally gave up on OpenCL and are trying to play catch-up to Nvidia via ROCm, effectively allowing you to run CUDA on AMD's server GPU offerings. And on the gaming side their top-of-the-line offering, the 7900 XTX, is ~$600 cheaper (aka 60%!) at MSRP than Nvidia's top-of-the-line RTX 4090 — and the prices you'd pay from e.g. resellers on eBay are even more skewed towards Nvidia. That being said, they're just way, way behind. Nvidia can charge what they do simply because AMD isn't great at making GPUs. In gaming AMD never caught up to Nvidia's raytracing perf, and AMD's attempt to clone DLSS is significantly less performant. Meanwhile in AI/ML the industry consolidated around CUDA because OpenCL was never that great, and — Nvidia owning the standard, and having built around it for over a decade, gives them a really big advantage. Plus, every GPU sold in the last decade+ by Nvidia supports CUDA, whereas only the new server GPUs from AMD support ROCm. Nvidia has executed incredibly well for decades: they pioneered shader programming, CUDA, raytracing, and DLSS. Arguably they even invented the GPU itself with the GeForce 256 in 1999 (as opposed to earlier "accelerator" cards). I struggle to think of anything AMD has done in the GPU space that matches even one of those accomplishments... Their only slight win is having OSS drivers for Linux, but honestly, that doesn't sell a whole lot of GPUs. AMD caught up to Intel on the CPU side in part thanks to Intel's failures. Nvidia just hasn't fumbled. Edit: Also, Intel is trying to edge their way into the GPU market as well with their Arc line of discrete GPUs, which is relatively affordable. They compete well on price, especially at the lower end: the A750 and A380 obliterate anything at their price points ($239 and $119, respectively). But, well, "at their price points" is a pretty critical part of that sentence. Their top-tier card, the A770, can barely eke out wins against the lower end of Nvidia's last-gen cards. And re: 2008-2011 ATI comparisons from a sibling comment — by 2010 Nvidia's Fermi architecture was reliably beating ATI again, albeit with higher power draw, and in 2007 they had just launched CUDA which ended up being the most lucrative market segment for GPUs. In retrospect I think Fermi was much less of a flop than it seemed (and it was a fairly brief one compared to Intel's CPU woes).
    - nl 4y ago
      ROCm development is understaffed and continually considerably behind CUDA too.
- metaphor 4y ago
  Agreed. At this point, it's clearly artificial GPU scarcity. We felt it early in consumer staples[1], and the grifting by auto dealers wasn't imagined either[2]...I won't even bother with the housing market to preserve my sanity. GPUs are really no different. Consumers need to wake up and smell the underlying meta[3]. [1] https://www.bls.gov/opub/btn/volume-12/measuring-shrinkflation-and-its-impact-on-inflation.htm https://www.bls.gov/opub/btn/volume-12/measuring-shrinkflati... [2] https://www.bls.gov/opub/mlr/2023/article/automotive-dealerships-markups.htm https://www.bls.gov/opub/mlr/2023/article/automotive-dealers... [3] https://scholarworks.umass.edu/econ_workingpaper/343/ https://scholarworks.umass.edu/econ_workingpaper/343/
  - epolanski 4y ago
    Not only artificial GPU scarcity. It is obviously clear that AMD and Nvidia are deliberately avoiding fighting each other on prices, something they got punished for in 2008, except that at the time it was done in secret meetings, now it's literally AMD playing alone and avoiding to compete completely on price.
    - jacooper 4y ago
      They compete on price, just not as much as before The 7900xtx is much better deal at 1000$ than 1200$ for the 4080, yet and isnt pushing prices as low as they used to. The difference is AMD actually discounts old GPUs and CPUs, a 6950XT can be found for around 500$ or less.
- MrBuddyCasino 4y ago
  As long as both have unsold inventory of their older architectures, they will not lower prices of the current generation, and they won't enter a price war. Intel's next generation might be able to exert some pressure, but by then AMD and Nvidia will probably have cleared their old inventory anyway.
- chiph 4y ago
  I am running on an ancient GTX 1070 and would like to upgrade to an RTX capable card, but there's no way I'm paying the current prices. I'm not sure why the prices remain high, after the crypto crash and pandemic shortages have eased. Cost of the Nvidia license? Cost of materials + production? Unrealistic profit projections? Probably a mix of all three.
  - dontlaugh 4y ago
    Same. I'm sticking with my even more ancient 970, it'll do for a while longer.
foreverobama 4y ago
[dead]

poisonborz 4y ago

Few events show how rotten the economic incentives are than this GPU scarcity: there are now massive inventories and over-production, huge demand, but prices are still sky high. Nvidia would rather destroy its inventory than go for pre-crypto prices. A massive amount of users stuck on 5-8 year old cards with still no good choices to upgrade. https://store.steampowered.com/hwsurvey/videocard/ https://store.steampowered.com/hwsurvey/videocard/

ragazzina 4y ago
Why are AMD or any other competition (I don't follow this sector very closely) not taking advantage of this and compete on price?
- metaphor 4y ago
  The big picture I'm seeing is there's a game being played[1], but to your point, AMD did respond to RTX 4070 launch by dropping prices on RX 6800 series GPUs[2]. [1] https://scholarworks.umass.edu/econ_workingpaper/343/ https://scholarworks.umass.edu/econ_workingpaper/343/ [2] https://news.ycombinator.com/item?id=35663511 https://news.ycombinator.com/item?id=35663511
- epolanski 4y ago
  Because gaming GPUs are not really profitable to AMD. As a reference, between 2008 and 2011 when ATI/AMD had the biggest technological lead over Nvidia's disaster architectures, even then when AMD was at near 50% market share it merely posted 19M of profits across 3 financial years! In the same time frame, despite terrible performances, Fermi architecture already going into the 400w consumption range, even then Nvidia posted billions of profits across the same time frame. AMD has simply stopped competing with Nvidia on prices, it's nonsense to them. Nowadays both Nvidia and AMD sell more GPUs to datacenters and super computers, where net margins are also twice as high than they do to gamers. Essentially both AMD and Nvidia are abandoning the gaming aspect of their hardware, stopped competing price-wise, instead they prefer both to sit on higher margins in the gaming market and focus on GPGPU aspect for business, research, automotive, AI, etc, etc, where the real money and growth is. The fact that this hardware is also able to crunch rendering calculations is more and more of a side effect.
  - hoseja 4y ago
    We need games that utilize local neural nets.
    - mepian 4y ago
      It seems that DLSS/XeSS is the only feasible application of local neural nets to games right now, everything else is too compute-hungry.
  - pdpi 4y ago
    AMD has notably cornered the console market with the Xbox One and Series X|S, PS4 and PS5. With the Steam Deck and now the Asus ROG Ally, they're starting to get themselves a position in the handheld market too.
    - themitigating 4y ago
      Is OEM integration profitable though? I would imagine Microsoft and Sony squeezed the best deal and maybe it will bring profit in later years when the research debt is paid
- meltyness 4y ago
  Intel doesn't really have a competing product. AMD and Nvidia sell the same thing made at the same place in Taiwan. Nvidia dove in like 1998. AMD sold it's moat in like, 2005.
- reissbaker 4y ago
  Contrary to what other posters are saying, I do think AMD is actually trying to compete; for example, they finally gave up on OpenCL and are trying to play catch-up to Nvidia via ROCm, effectively allowing you to run CUDA on AMD's server GPU offerings. And on the gaming side their top-of-the-line offering, the 7900 XTX, is ~$600 cheaper (aka 60%!) at MSRP than Nvidia's top-of-the-line RTX 4090 — and the prices you'd pay from e.g. resellers on eBay are even more skewed towards Nvidia. That being said, they're just way, way behind. Nvidia can charge what they do simply because AMD isn't great at making GPUs. In gaming AMD never caught up to Nvidia's raytracing perf, and AMD's attempt to clone DLSS is significantly less performant. Meanwhile in AI/ML the industry consolidated around CUDA because OpenCL was never that great, and — Nvidia owning the standard, and having built around it for over a decade, gives them a really big advantage. Plus, every GPU sold in the last decade+ by Nvidia supports CUDA, whereas only the new server GPUs from AMD support ROCm. Nvidia has executed incredibly well for decades: they pioneered shader programming, CUDA, raytracing, and DLSS. Arguably they even invented the GPU itself with the GeForce 256 in 1999 (as opposed to earlier "accelerator" cards). I struggle to think of anything AMD has done in the GPU space that matches even one of those accomplishments... Their only slight win is having OSS drivers for Linux, but honestly, that doesn't sell a whole lot of GPUs. AMD caught up to Intel on the CPU side in part thanks to Intel's failures. Nvidia just hasn't fumbled. Edit: Also, Intel is trying to edge their way into the GPU market as well with their Arc line of discrete GPUs, which is relatively affordable. They compete well on price, especially at the lower end: the A750 and A380 obliterate anything at their price points ($239 and $119, respectively). But, well, "at their price points" is a pretty critical part of that sentence. Their top-tier card, the A770, can barely eke out wins against the lower end of Nvidia's last-gen cards. And re: 2008-2011 ATI comparisons from a sibling comment — by 2010 Nvidia's Fermi architecture was reliably beating ATI again, albeit with higher power draw, and in 2007 they had just launched CUDA which ended up being the most lucrative market segment for GPUs. In retrospect I think Fermi was much less of a flop than it seemed (and it was a fairly brief one compared to Intel's CPU woes).
  - nl 4y ago
    ROCm development is understaffed and continually considerably behind CUDA too.
metaphor 4y ago
Agreed. At this point, it's clearly artificial GPU scarcity. We felt it early in consumer staples[1], and the grifting by auto dealers wasn't imagined either[2]...I won't even bother with the housing market to preserve my sanity. GPUs are really no different. Consumers need to wake up and smell the underlying meta[3]. [1] https://www.bls.gov/opub/btn/volume-12/measuring-shrinkflation-and-its-impact-on-inflation.htm https://www.bls.gov/opub/btn/volume-12/measuring-shrinkflati... [2] https://www.bls.gov/opub/mlr/2023/article/automotive-dealerships-markups.htm https://www.bls.gov/opub/mlr/2023/article/automotive-dealers... [3] https://scholarworks.umass.edu/econ_workingpaper/343/ https://scholarworks.umass.edu/econ_workingpaper/343/
- epolanski 4y ago
  Not only artificial GPU scarcity. It is obviously clear that AMD and Nvidia are deliberately avoiding fighting each other on prices, something they got punished for in 2008, except that at the time it was done in secret meetings, now it's literally AMD playing alone and avoiding to compete completely on price.
  - jacooper 4y ago
    They compete on price, just not as much as before The 7900xtx is much better deal at 1000$ than 1200$ for the 4080, yet and isnt pushing prices as low as they used to. The difference is AMD actually discounts old GPUs and CPUs, a 6950XT can be found for around 500$ or less.
MrBuddyCasino 4y ago
As long as both have unsold inventory of their older architectures, they will not lower prices of the current generation, and they won't enter a price war. Intel's next generation might be able to exert some pressure, but by then AMD and Nvidia will probably have cleared their old inventory anyway.
chiph 4y ago
I am running on an ancient GTX 1070 and would like to upgrade to an RTX capable card, but there's no way I'm paying the current prices. I'm not sure why the prices remain high, after the crypto crash and pandemic shortages have eased. Cost of the Nvidia license? Cost of materials + production? Unrealistic profit projections? Probably a mix of all three.
- dontlaugh 4y ago
  Same. I'm sticking with my even more ancient 970, it'll do for a while longer.

foreverobama 4y ago

[dead]