Nvidia Q2 Gaming Revenue down 1 Billion USD compared to Q2 2021 | Spending Boom Over

[AlTech]

Summary

Nvidia has released preliminary Q2 earnings information ahead of it's official earnings report due in 2 weeks.

 

The key takeaway? Nvidia's Q2 Gaming Revenue fell by 1 Billion USD (33.33%) compared to Q2 2021.

 

Nvidia's gaming revenue has been reported as being $2.04 Billion USD in Q2 2022.

 

This decline is revenue is largely attributed by The Verge to customers having bought what they wanted to buy in 2021 during a period of immense spending across a number of business sectors and industries. With customers owning new or recent hardware, there isn't much need to acquire new hardware in 2022.

 

 

Quotes

Quote

Nvidia’s Q2 earnings won’t come out for another two weeks, but the company has dropped its preliminary numbers today and the results are not looking particularly good for its gaming business. Its gaming revenue is reported at $2.04 billion, a staggering 33.33 percent decrease from the previous year’s $3.06 billion

 

My thoughts

It makes sense that gaming revenue is down, but to be honest I think it's also down cos gamers aren't as desperate for cards and so Average Selling Prices of cards has probably fallen significantly. The only real player to be making great GPU sales this year seems to be AMD from selling their console APUs. I guess Intel counts too since they started selling Arc GPUs. AMD's gaming revenue is up 32% which is about as much up as Nvidia's is down.

 

Right now, the console APU business seems to be a safe place to be at. I have to wonder if Nvidia is going to push Nintendo to partner up for whatever ends up replacing the Maxwell powered Switch. Because gaming revenue for Nvidia is fundamentally just a side business, a nice to have if you will. If they were to expand it, it could become something more. At any rate, this is likely to further cause Nvidia to design GPUs with Professional GPUs in mind and then reselling those to gamers, as they have been doing since Turing. I think eventually it will backfire on Nvidia because there's a limit to how much games behave like maths equations that need solving.

 

Sources

https://www.theverge.com/2022/8/8/23296717/nvidia-earnings-q2-2022-gpu-gaming-cryptocurrency

[leadeater]

25 minutes ago, AluminiumTech said:

as they have been doing since Turing. I think eventually it will backfire on Nvidia because there's a limit to how much games behave like maths equations that need solving.

That's really not correct. The large compute architecture and dies are not the same as the lower ones used for gaming and lesser "Quadro/Tesla" cards, those are still designed around traditional rendering workloads not compute.

 

A G100 die and architecture makeup is different to GA102+, it's been this way since before Turing.

 

Edit:

Quote

The full implementation of the GA100 GPU includes the following units:

• 8 GPCs, 8 TPCs/GPC, 2 SMs/TPC, 16 SMs/GPC, 128 SMs per full GPU
• 64 FP32 CUDA Cores/SM, 8192 FP32 CUDA Cores per full GPU
• 4 third-generation Tensor Cores/SM, 512 third-generation Tensor Cores per full GPU 
• 6 HBM2 stacks, 12 512-bit memory controllers 

https://images.nvidia.com/aem-dam/en-zz/Solutions/data-center/nvidia-ampere-architecture-whitepaper.pdf

 

Quote

Each SM in GA10x GPUs contain 128 CUDA Cores, four third-generation Tensor Cores, a 256 KB Register File, four Texture Units, one second-generation Ray Tracing Core, and 128 KB of L1/Shared Memory, which can be configured for differing capacities depending on the needs of the compute or graphics workloads.

The memory subsystem of GA102 consists of twelve 32-bit memory controllers (384-bit total). 512 KB of L2 cache is paired with each 32-bit memory controller, for a total of 6144 KB on the full GA102 GPU.

https://www.nvidia.com/content/PDF/nvidia-ampere-ga-102-gpu-architecture-whitepaper-v2.pdf

[AlTech]

3 minutes ago, leadeater said:

That's really not correct. The large compute architecture and ides are not the same as the lower ones used for gaming and lesser "Quadro/Tesla" cards, those are still designed around traditional rendering workloads not compute.

 

A G100 die and architecture makeup is different to GA102+, it's been this way since before Turing.

RTX and Tensor cores were designed for compute, and then they later found a use for gaming.

[leadeater]

4 minutes ago, AluminiumTech said:

RTX and Tensor cores were designed for compute, and then they later found a use for gaming.

No that's not it at all, see my edit. The GA100 architecture makeup is literally different to GA102+, as it has been since Pascal.

 

Gx100 SM != Gx10x SM

[porina]

9 hours ago, AluminiumTech said:

gaming revenue for Nvidia is fundamentally just a side business, a nice to have if you will.

No, not even close. Gaming has been nvidia's biggest revenue share for most of the company's existence. Only very recently did datacentre overtake, but it's still close between them. For Q2, gaming at $2B and DC is at $3.8B, as gaming is falling while DC continues to rise. Gaming probably has more cyclic variation than DC so might be better to compare annual results for a better picture.

 

For a sense of perspective, even with the drop in nvidia's Q2 numbers, in the gaming segment they're still pulling in more cash than AMD (roughly $2B vs $1.6B). Given that most of AMD's gaming revenue is probably from consoles, makes you wonder how many dGPUs they're actually shifting and I still feel they're at risk of falling to 3rd if Intel keep trying.

[Ydfhlx]

I wonder how does the number of GPUs sold compare. Because it might not be much lower than last year, but revenue still be down so much due to prices decreasing substantially.

[AlTech]

4 hours ago, porina said:

No, not even close. Gaming has been nvidia's biggest revenue share for most of the company's existence.

I'm not talking about the old Nvidia of the 90s and 2000s.

4 hours ago, porina said:

Only very recently did datacentre overtake, but it's still close between them. For Q2, gaming at $2B and DC is at $3.8B, as gaming is falling while DC continues to rise. Gaming probably has more cyclic variation than DC so might be better to compare annual results for a better picture.

 

4 hours ago, porina said:

For a sense of perspective, even with the drop in nvidia's Q2 numbers, in the gaming segment they're still pulling in more cash than AMD (roughly $2B vs $1.6B).

Sure but console revenue is more predictable and it has the added bonus of steering the direction of gaming as a whole and what technologies games use.

 

AMD has the ability to push FSR and RSR to make it really go places in part because they supply the main console APUs including now SteamDeck.

 

Nvidia has less influence over how cross device (games on Console and PC) games are made and their only existing strategies afaik are to sabotage AMD performance in GameWorks titles on PC and to use distribution agreements akin to their prior GPP programme to force AIBs to bow down to Nvidia's demands and wishes.

 

Most AIBs and partners of Nvidia would not willingly do business with Nvidia because of how Nvidia treats them but they have no choice.

4 hours ago, porina said:

Given that most of AMD's gaming revenue is probably from consoles, makes you wonder how many dGPUs they're actually shifting

AMD were selling some of the highest volume of dGPUs they've ever sold if not actually the highest volume in 2020 and 2021.

 

2020 and 2021 was a gift to AMD; they couldn't make cards fast enough to sell them.

4 hours ago, porina said:

and I still feel they're at risk of falling to 3rd if Intel keep trying.

At risk, yes. Likely to fall to 3rd? Not at all likely unless Intel suddenly starts offering Arc GPUs with significantly better performance. Also, Intel is an unknown with their dGPU drivers.

 

Even if Intel had a better GPU product than AMD, which they do not, then I suspect Intel would still come in 3rd place until they, among other things, establish themselves as a trustworthy dGPU driver maker

[porina]

3 minutes ago, AluminiumTech said:

I'm not talking about the old Nvidia of the 90s and 2000s.

Nor am I. Link below is a random reference I found that visualises it. It doesn't have Q2 but in the period back to FY15 gaming was top apart from 2 quarters.

https://www.nextplatform.com/2022/05/26/datacenter-becomes-nvidias-largest-business/

 

Including Q2, in 3 quarters of the last 7+ years gaming has not been the biggest slice of nvidia's pie. It may be that gaming will remain smaller going forward in the short term but we'll have to wait and see.

 

3 minutes ago, AluminiumTech said:

Sure but console revenue is more predictable and it has the added bonus of steering the direction of gaming as a whole and what technologies games use.

You mean holding back gaming by arriving late when they do eventually copy features, often in an inferior way.

 

3 minutes ago, AluminiumTech said:

2020 and 2021 was a gift to AMD; they couldn't make cards fast enough to sell them.

You could say the same for nvidia. The difference is I feel AMD chose not to make as many GPUs as they pushed more production to more profitable areas like server CPUs. Look at the Steam Hardware Survey. When I last looked in February data, all of AMD GPUs including APUs numbered a smaller share than RTX GPUs alone. More 3090s were used than all shown RDNA2 cards. I want to repeat this for the August data to see how it shifted in 6 months, but that means waiting until September.

 

3 minutes ago, AluminiumTech said:

At risk, yes. Likely to fall to 3rd? Not at all likely unless Intel suddenly starts offering Arc GPUs with significantly better performance. Also, Intel is an unknown with their dGPU drivers.

This is not a short term thing. It will be interesting to see how it goes in a couple of generations. I just feel it is more likely for AMD to throw the fight as they're focused on non-consumer products.

[CTR640]

It could be because cryptomining is no longer rendable on RTX30 and gamers are waiting for RTX40. It's only a matter of time before the history will repeat again.

[AnonymousGuy]

2 hours ago, CTR640 said:

It could be because cryptomining is no longer rendable on RTX30 and gamers are waiting for RTX40. It's only a matter of time before the history will repeat again.

Mining is still profitable.  3080Ti right now makes around $3/day.   

 

In general everyone panicked a few months ago...business and consumers...that we're going to have a hard recession.  Hiring stopped, capEx stopped, etc.  I don't know how much mining really is their balance sheet but everyone also panicked hard there too with crypto crashing and rumors that the 4000 series was coming out in like July or some absurd shit.   Sooooooo many cards showing up for super cheap.  Who has two thumbs and is willing to cash in on novice panic?  This guy!  I'll buy $725 3080Ti's all day long.  They'll be resellable at that price a year from now.

[Senzelian]

20 hours ago, leadeater said:

compute architecture

 

20 hours ago, AluminiumTech said:

designed for compute

 

Isn't compute just the dumbest buzzword ever? I guess Nvidia somehow made it its own thing, but isn't any chip made for computing? Isn't that what chips do?  

[leadeater]

10 minutes ago, Senzelian said:

Isn't compute just the dumbest buzzword ever? I guess Nvidia somehow made it its own thing, but isn't any chip made for computing? Isn't that what chips do?  

haha yea very true, end result is mathematical calculations for pixel colour values 

[Brooksie359]

12 hours ago, porina said:

No, not even close. Gaming has been nvidia's biggest revenue share for most of the company's existence. Only very recently did datacentre overtake, but it's still close between them. For Q2, gaming at $2B and DC is at $3.8B, as gaming is falling while DC continues to rise. Gaming probably has more cyclic variation than DC so might be better to compare annual results for a better picture.

 

For a sense of perspective, even with the drop in nvidia's Q2 numbers, in the gaming segment they're still pulling in more cash than AMD (roughly $2B vs $1.6B). Given that most of AMD's gaming revenue is probably from consoles, makes you wonder how many dGPUs they're actually shifting and I still feel they're at risk of falling to 3rd if Intel keep trying.

Based on initial data on Intel gpus I doubt they will overtake amd anytime soon. It's legit hit or miss for Intel so I wouldn't recommend one as sometimes it's competitive while other times the performance is so bad it's being beat by gpus that are either much cheaper or much older gpus. 

[porina]

8 minutes ago, Brooksie359 said:

Based on initial data on Intel gpus I doubt they will overtake amd anytime soon. It's legit hit or miss for Intel so I wouldn't recommend one as sometimes it's competitive while other times the performance is so bad it's being beat by gpus that are either much cheaper or much older gpus. 

Again I'm not talking about current gen. Look forward a couple gens to maybe Celestial. While Intel is not playing for volume this early on, I feel they have the potential resources to push harder than AMD in the dGPU space once they get more settled. It feels like AMD didn't really try to shift dGPU volume in RDNA2 generation, and they prioritised their silicon allocation towards server CPUs. We'll have to see how they do in RDNA3 generation.

[Shreyas1]

13 hours ago, porina said:

No, not even close. Gaming has been nvidia's biggest revenue share for most of the company's existence. Only very recently did datacentre overtake, but it's still close between them. For Q2, gaming at $2B and DC is at $3.8B, as gaming is falling while DC continues to rise. Gaming probably has more cyclic variation than DC so might be better to compare annual results for a better picture.

 

For a sense of perspective, even with the drop in nvidia's Q2 numbers, in the gaming segment they're still pulling in more cash than AMD (roughly $2B vs $1.6B). Given that most of AMD's gaming revenue is probably from consoles, makes you wonder how many dGPUs they're actually shifting and I still feel they're at risk of falling to 3rd if Intel keep trying.

Wait, what counts as gaming? If a laptop uses a chip like a mx450 or 1650, does that count as a gaming sale? Does it include chips sold to Nintendo for switches? I mean the Switch is one of the best selling consoles of all time.

[porina]

17 minutes ago, Shreyas1 said:

Wait, what counts as gaming? If a laptop uses a chip like a mx450 or 1650, does that count as a gaming sale? Does it include chips sold to Nintendo for switches? I mean the Switch is one of the best selling consoles of all time.

Good question. I don't have a good answer. My take on it is that gaming would include all consumer branded GPU products so yes it would include the lower end stuff. Put it another way, do they market any non-gaming cards in the consumer space?

 

The Switch chips are less clear. I'd guess that could come under their OEM and IP category, since it isn't a product they're selling under their own name. You do buy a laptop or PC with nvidia graphics. You don't buy a Switch and refer to the GPU in doing so. I don't know what else they might supply in that category so don't take it to be Switch only.

[leadeater]

4 minutes ago, porina said:

Put it another way, do they market any non-gaming cards in the consumer space?

Nope, they are segmented via product channel. Anything GeForce = Gaming, anything "A" series with video out = Professional, anything "A" series without video out (by default) = Datacenter.

 

What product they go in doesn't change it, so a Mobile variant of an A series professional GPU in a Lenovo laptop is counted as professional even if that same laptop has a GeForce option etc.

[AlTech]

18 hours ago, Senzelian said:

 

 

Isn't compute just the dumbest buzzword ever?

Yes

18 hours ago, Senzelian said:

I guess Nvidia somehow made it its own thing, but isn't any chip made for computing? Isn't that what chips do?  

When I used the word I meant vs gaming as a workload. Yes, any CPU or GPU can perform calculations or compute things.

 

Hardware in CPUs and GPUs are usually fairly general purpose minus the ocasional fixed function hardwsre accelerator or display or media blocks . General purpose compute hardware works on more or less whatever you want it to within reason and technical limits.

 

Some designs are better at some things than other things and GPUs do the best when optimized for the workflow they're designed for.

 

16 hours ago, porina said:

Good question. I don't have a good answer. My take on it is that gaming would include all consumer branded GPU products so yes it would include the lower end stuff.

Anything within the GeForce brand I would guess they put under gaming revenue besides GeForce Now. Not sure if they keep that revenue separate.

16 hours ago, porina said:

Put it another way, do they market any non-gaming cards in the consumer space?

They did with their mining cards.

16 hours ago, porina said:

The Switch chips are less clear. I'd guess that could come under their OEM and IP category, since it isn't a product they're selling under their own name.

I'm not sure tbh. AMD puts their Console revenue under Gaming revenue along with other gaming products. Wouldn't surprise me if Nvidia did the same but for Switch.

16 hours ago, porina said:

You do buy a laptop or PC with nvidia graphics. You don't buy a Switch and refer to the GPU in doing so. I don't know what else they might supply in that category so don't take it to be Switch only.

At this point I would imagine it would have to be switch only because nothing else fits on that category.

 

[porina]

3 minutes ago, AluminiumTech said:

They did with their mining cards.

They were not consumer marketed and never officially sold through retail. Before you say there was that some place that did, there's not much to stop resales if they can find their way to get their hands on one.

 

3 minutes ago, AluminiumTech said:

I'm not sure tbh. AMD puts their Console revenue under Gaming revenue along with other gaming products. Wouldn't surprise me if Nvidia did the same but for Switch.

At this point I would imagine it would have to be switch only because nothing else fits on that category.

Have AMD always done that? I see in their latest report:

Quote

AMD previously announced new segments beginning the second quarter to align financial reporting with the way AMD now manages its business in strategic end markets.

 

Gaming segment includes discrete graphics processors and semi-custom game console products.

I don't see any obvious definitions in nvidia's latest report. I don't usually look at reports from either, since it is largely irrelevant as a consumer.

[Heliian]

Someone had to have foreseen the slowdown in crypto sales.  They made a good quick buck but demand has dried up.  It's as though making the product too expensive and unavailable drove away customers.  

 

Whatever though, they're still in the black.