Nvidia have a huge inventory excess problem, 300,000 GPUs returned from a single board partner

[Misanthrope]

1 hour ago, M.Yurizaki said:

And how are they supposed to magically predict with ballistic precision when there will be a surge of demand based on some speculative thing that just happened to run best on their hardware?

 

Production also doesn't just ramp up magically either. Nobody can just go "hey, go make an extra 200K GPUs by the end of the end of the month"

Really you're just going to ignore the part you quote that answers your question, even when I made it bold and italic you're just going to ignore "far beyond what you knew the gaming market could bear"?

 

Since it doesn't matters what I actually say to you and you probably won't read it, my answer to your question then it's ducks and cows.

[Fred Castellum]

I'm curious to who this board partner may be now.....

 

7 hours ago, Princess Cadence said:

I don't get this market, one day there simply is no way to address the high demands, shortages worldwide and super over-inflated prices, then the other day, hundreds of thousands of over-stocked cards, no idea what to do with them... purpose delay due to excessive stocks.... whaaat?

Everything in the market operates on supply and demand, and supply and demand also includes earnings and shareholder profits now. In other words, companies will do things that would be frowned upon by consumers as long as it insures high cash flow and keeps investor hype.

 

I've seen hundreds of companies create artificial shortages or inflation for their products in order to curb or increase sales for whatever reason, real sketchy stuff tends to happen pretty often for openly traded companies.

[Princess Luna]

1 minute ago, MyInnerFred said:

.

I thought I didn't have to write /s at the end of my post xd.

 

I was joking at it really

[laminutederire]

7 hours ago, Princess Cadence said:

I don't get this market, one day there simply is no way to address the high demands, shortages worldwide and super over-inflated prices, then the other day, hundreds of thousands of over-stocked cards, no idea what to do with them... purpose delay due to excessive stocks.... whaaat?

The perceived shortage drove up prices which probably made up for more than what they didn't sell in the end.

[Drak3]

29 minutes ago, Misanthrope said:

Really you're just going to ignore the part you quote that answers your question

That's worthless speculation, that doesn't even answer the question. It's a dodge by tangent.

 

And from a business perspective, excessively and exceptionally stupid to even devote a single brain cell into considering.

[Fred Castellum]

45 minutes ago, Princess Cadence said:

I thought I didn't have to write /s at the end of my post xd.

 

I was joking at it really

Oh... 

 

Didn't seem like it to me. Sarcasm carries over badly with text.

 

[Taf the Ghost]

I think this story might be about the 1050/1030 production at Samsung. Nvidia might have overbought the lower-end production. High-end cards will keep selling over the duration, but low-end cards can get really weird at times.

[veli2501]

4 hours ago, Misanthrope said:

Good! Next time you'll make sure you don't turn a blind eye at that same Taiwanese distributor who requested inventory far beyond what you knew the gaming market could bear and henceforth should have made you pause and say "No, these are mining sales"

 

Both Nvidia and AMD can quite frankly and pardon my french: eat fucking shit and just sit on that stock or let it go for really cheap, maybe next time they won't throw their core market consumers under the bus for those ephemeral Ethereum bucks.

Nvidia and AMD have no control over which end users purchase the GPUs.  They ramped up production to try to help their core market and were left in this position because of the crypto market crash.  Blame miners if anything.   Of course the increase in production was for both markets, if they only produced enough to satisfy the gaming market they would still be in the same position of being short on supply for the total market.

 

I remember reading about AMD stating that they were apprehensive to increase production to meet the demand due to the crypto boom as they were burnt the last time they did and the demand died off.  It seems this time around it was Nvidia who copped it.

[Misanthrope]

3 minutes ago, veli2501 said:

They ramped up production to try to help their core market and were left in this position because of the crypto market crash.

See this sounds reasonable but it's extremely inaccurate: They didn't. There's nothing to indicate there was an exponentially larger demand from gamers at all. They knew the extra demand was due to miners. It was extremely easy for them to see why they had this increased demand so to characterize the increased demand as their "core market" it's a mistake.

 

An important one, because both AMD and Nvidia would like you to think they had nooo knowledge and nooo way of knowing these cards were for miners. They will swear up and down that they're all about the gamers! Because they know they're much better long term customers.

 

However anybody and henceforth, everybody knew the demand explosion was due to Ethereum. They saw a way to profit by increasing their production to meet that new demand but again, that wasn't for their core market but this new secondary one.

 

The good news is that they got a lot of money out of it. The bad news is that they generated a lot of bad will among their core market specially now that they are left with an abundance of chips they still don't want to release to the gamer market because they know they'd crash the prices and then they wouldn't be able to justify the prices for future generations.

 

So they basically lost a bunch of money due to the Ethereum and other cypto demand dying. And to me that's a good thing they deserve to get a financial hit now since they more that made up for it previously with the increased mining sales

[veli2501]

8 minutes ago, Misanthrope said:

See this sounds reasonable but it's extremely inaccurate: They didn't. There's nothing to indicate there was an exponentially larger demand from gamers at all. They knew the extra demand was due to miners. It was extremely easy for them to see why they had this increased demand so to characterize the increased demand as their "core market" it's a mistake.

Yes they did because the only way to bring prices back to normality was to increase production so the supply was available to both miners and gamers alike. You're correct in saying there was no indication that there was a larger demand for gamers.  But there was a higher demand full stop. The mining market was creating a shortage that affected their core market, hence the reason why the increase in production is in part to assist said market.  I don't know how this is so hard to comprehend.  It's essentially the one market.

[Brooksie359]

28 minutes ago, Misanthrope said:

See this sounds reasonable but it's extremely inaccurate: They didn't. There's nothing to indicate there was an exponentially larger demand from gamers at all. They knew the extra demand was due to miners. It was extremely easy for them to see why they had this increased demand so to characterize the increased demand as their "core market" it's a mistake.

 

An important one, because both AMD and Nvidia would like you to think they had nooo knowledge and nooo way of knowing these cards were for miners. They will swear up and down that they're all about the gamers! Because they know they're much better long term customers.

 

However anybody and henceforth, everybody knew the demand explosion was due to Ethereum. They saw a way to profit by increasing their production to meet that new demand but again, that wasn't for their core market but this new secondary one.

 

The good news is that they got a lot of money out of it. The bad news is that they generated a lot of bad will among their core market specially now that they are left with an abundance of chips they still don't want to release to the gamer market because they know they'd crash the prices and then they wouldn't be able to justify the prices for future generations.

 

So they basically lost a bunch of money due to the Ethereum and other cypto demand dying. And to me that's a good thing they deserve to get a financial hit now since they more that made up for it previously with the increased mining sales

The only way to bring down gpu prices was to increase production so they did in order to allow gamers to buy their gpus near msrp. You are right they could have just not ramped up production and keep prices at insane prices for both markets. If they don't increase production people criticize them for artificially inflating the prices of their gpus and if they ramp it up they get criticized for trying to profit off of mining demand. I mean that seems like a lose lose situation where people are going to criticize them either way because they don't like them. Honestly I don't like most of the thing nvidia has done as of late but increasing production to help the gpu pricing go back to normal isn't one of those things. 

[mark_cameron]

Nvidia should face a EU/US competition inquiry.

 

The price of GPUs is +100% RRP/MRRP in some quarters like Amazon

 

Yet they are artificially restricting supply. Clearly. Which is detrimental for the consumer.

 

Its utterly outrageous.

 

[mark_cameron]

4 hours ago, MyInnerFred said:

I'm curious to who this board partner may be now.....

 

Everything in the market operates on supply and demand, and supply and demand also includes earnings and shareholder profits now. In other words, companies will do things that would be frowned upon by consumers as long as it insures high cash flow and keeps investor hype.

 

I've seen hundreds of companies create artificial shortages or inflation for their products in order to curb or increase sales for whatever reason, real sketchy stuff tends to happen pretty often for openly traded companies.

Doing that is ILLEGAL under competition/anti trust law.

 

Especially if more than one company in a market does a 'concerted practice' which causes consumers to pay more than they otherwise would.

[mark_cameron]

 

11 hours ago, EPENEX said:

Okay, then why is the GTX 1080 I added to my Amazon wishlist 2 years ago still not reduced in price since I originally added it?

 

11 hours ago, TechyBen said:

Artificial scarcity seems to win every time.

 

Price inflexibility (no to little price drops) when supply outstrips demand

 

Whilst observing rampant price increases when demand outstrips supply :

 

Is a clear indication of potential competition law issues and price fixing in markets.

 

If I were a competition regulator I'd be looking very closely at the GPU market. Right now.

[Fred Castellum]

29 minutes ago, mark_cameron said:

Doing that is ILLEGAL under competition/anti trust law.

 

Especially if more than one company in a market does a 'concerted practice' which causes consumers to pay more than they otherwise would.

Of course it is, that's why Micron along with a couple of semiconductors are getting nailed with lawsuits right now for artificially creating a shortage. There are many occasions where it can be speculated that a company is doing some sketchy stuff to increase net profit for a upcoming earnings report, it's not incredibly hard to keep it under the federal radar. 

 

As long as information isn't leaked companies can easily get away with anti-consumer, anti-competitive, and anti-technology practices. You see this sorta thing in pharmaceutical companies often, and prospect companies as well be it rare metals or oil.

[asus killer]

if demand is larger than supply then prices go up as he all bloody well know.

 

Now just stick with me as this is a crazy idea...

I wonder if there is a possibility that if supply is bigger then demand the prices i don't know let's say go down? wow right!!!  i know it's out there, way out of the box and unprecedented, but is there such possibility? can any nuclear physicist or space engineer clarify this?

[Granular]

3 minutes ago, asus killer said:

if demand is larger than supply then prices go up as he all bloody well know.

 

Now just stick with me as this is a crazy idea...

I wonder if there is a possibility that if supply is bigger then demand the prices i don't know let's say go down? wow right!!!  i know it's out there, way out of the box and unprecedented, but is there such possibility? can any nuclear physicist or space engineer clarify this?

Guy who's played a lot of Space Engineers here.

According to my TI-83, rising VRAM prices will offset, whatever price reductions could be expected from excess GPUs.

[asus killer]

24 minutes ago, Granular said:

rising VRAM prices will offset, whatever price reductions could be expected from excess GPUs.

that makes no sense at all, as the cost of components is now irrelevant, it's a supply and demand problem. Just because you build a very expensive house it doesn't mean you don't have to sell it on the cheap is no one want's it.

[Granular]

3 minutes ago, asus killer said:

that makes no sense at all, as the cost of components is now irrelevant, it's a supply and demand problem. Just because you build a very expensive house it doesn't mean you don't have to sell it on the cheap is no one want's it.

Using a housing analogy, the situation is more like there's an excess of concrete (GPUs) on the market.

But if the price of steel (VRAM) has risen dramatically at the same time, there's no reason for a construction company (a board maker) to sell houses they build cheaply.

[NelizMastr]

12 hours ago, Master Disaster said:

Fun fact: This guy has a degree in Sports Information and was a bodybuilding promotor.

[asus killer]

23 minutes ago, Granular said:

Using a housing analogy, the situation is more like there's an excess of concrete (GPUs) on the market.

But if the price of steel (VRAM) has risen dramatically at the same time, there's no reason for a construction company (a board maker) to sell houses they build cheaply.

fair enough, bad analogy. Still what i meant is the price of the rest of the components is irrelevant, what matters is the price of what you are selling and you're not telling me that lowering the price of the GPU is irrelevant. Irrelevant is the price of the other components, that's like saying no one should bother lower a price of anything if there is more than 1 component.

I'm not discussing the price of the final product, that's irrelevant here.

[Granular]

4 minutes ago, asus killer said:

fair enough, bad analogy. Still what i meant is the price of the rest of the components is irrelevant, what matters is the price of what you are selling and you're not telling me that lowering the price of the GPU is irrelevant. Irrelevant is the price of the other components, that's like saying no one should bother lower a price of anything if there is more than 1 component.

I'm not discussing the price of the final product, that's irrelevant here.

It's irrelevant to the consumer who's never buying just the GPU chip.

[Nineshadow]

14 hours ago, TVwazhere said:

Very close to MSRP in some cases (thank god)

 

Seeing an RX580 8gb under $300 is a relieving sight

Still 400 EUR here...

[asus killer]

26 minutes ago, Granular said:

It's irrelevant to the consumer who's never buying just the GPU chip.

oh boy! The OEM didn't wanted the chips because he couldn't sell it... at that price, that's economy 101, lower the price people will buy. The OEM would probably be happy to sell 1080ti's at the price of 1060's and everyone would buy, i would. I completely don't follow your logic at all !

 

Besides what i was saying initially was for Nvidia that made a killing in the gpu crisis to now lower the prices and take the hit, it's only fair, and it would probably be a drop in the ocean for them. But it was also a joke, companies always love the profits and make a case when anything goes wrong. I mean this is something that made them not release the 11**!! come on, strap for cash Nivida?  

 

And the same goes for the OEM's, so you made a killing and now return it. I mean if they can return good for them, Nvidia were idiots making a contract like this, but OEM's milked the cow for over a year and now don't want to shovel the shit left behind.

 

[Granular]

3 minutes ago, asus killer said:

oh boy! The OEM didn't wanted the chips because he couldn't sell it... at that price, that's economy 101, lower the price people will buy. The OEM would probably be happy to sell 1080ti's at the price of 1060's and everyone would buy, i would. I completely don't follow your logic at all !

Why would Nvidia want people getting 1080Tis for the price of 1060's? They'd have to be basically giving away silicon that cost them money to produce and ensuring lower demand for the next generation cards, when they release. At that point they might as well dump them in the sea. On the other hand, just holding onto them until another OEM is ready to pick them up at the usual price can't cost that much in warehouse space.