Nvidia hit by GPU slump, too
Tegra 2 stepped on by Tegra 3
Microprocessor and GPU maker Advanced Micro Devices said yesterday that its financial results had been whacked by an unexpected downturn in discrete graphics processor sales in the fourth quarter, and Nvidia now says it had the same problem.
In a statement, Nvidia put the blame squarely on the disk shortage that has been caused by the flooding in Thailand last year, which has put a damper on PC sales in the second half of 2011. The current theory at AMD is that the disk shortages have been most dramatic on the fatter disks used in desktop PCs, which generally have a discrete graphics card instead. With disks in short supply and prices rising, PC sales slumped and took down GPUs with them. Nvidia echoed those comments.
"The global disk-drive shortage caused by the flooding in Thailand had more impact on the mainstream GPU segment than anticipated," Nvidia said in its statement. "Shipments by some PC OEMs were reduced. And the higher prices of disk-drives constrained some PC OEMs' ability to include a GPU in their systems."
It is interesting to ponder if Nvidia was also hurt by the expectation that it will be shipping its next generation "Kepler" GPUs, due sometime this year and initially expected at the end of last year.
Nvidia also said that its dual-core Tegra 2 ARM-based system-on-chip processors declined more rapidly than expected in the wake of the launch of the quad-core Tegra 3 SoCs, which are ramping in production during the first quarter of this year.
When you add it all up, Nvidia now says that revenues for fourth quarter of 2011 will range from $940.5m to $959.5m. This is considerably lower than its prior guidance from early November, when Nvidia expected sales to fall between $1.045bn and $1.087bn.
Nvidia will report its fourth quarter results on February 15. ®
"Oh... new generation of Intel graphics is out, I have to get a new CPU!"
And a new Motherboard, and new Memory, and new cooler.... Intel is far from upgrade friendly.
And you'll still end up with a system that you'll have to lower the detail settings, AA etc to the lowest setting to get a decent framerate.
"Oooooh the AMD 5870 is below £150!" Buy - 5 mins screwdriver work, and a driver download and you're done.
If *anything* it is CPUs that have got to the point now where it is largely pointless to upgrade.... Take a Mid-High end GFX card in 1 box with a Dual Core 2Ghz CPU and another with a 6 Core 4GHz monster and you'll see VERY little improvement.
Put in a better GFX card and the difference is HUGE.
Discrete GFX will be around for a good long while yet.
A revenue number in isolation doesn't mean very much. $950m in revenue is fantastic if your expenses are $400m. Not so good if your expenses are $2bn.
Holy shit, AMD and NVidia need new CEOs
Both of these companies are blaming the decline of discrete graphics chips on market conditions. Sure, I'm willing to say there's a little truth to that, but that's rubbish in the bigger picture.
The real (and bloody obvious) reason is, that with the exception of people who have high end graphics requirements, Intel has finally caught up enough that there's no real point to buying an additional GPU. In fact, in memory intense circumstances, using a faster GPU on a slower bus is a performance detriment.
I have been playing lots of games (WoW, DC Universe Online, etc...) on a laptop that has a Core i7 with the Intel GMA 3000 graphics adapter as well as the nVidia GT540M. The screen is 1920x1080. And frankly, I very rarely bother starting the games with the nVidia chip since the GMA 3000 is fast enough and my battery lasts A LOT longer and the fan doesn't make as much noise.
Ivy Bridge graphics are 3 -5 times as fast as Sandy Bridge and are coming soon. When next generation notebooks, desktops and tablets ship, it will be really hard to justify purchasing an extra video card unless you're playing Battlefield or Crysis. On top of that, Intel isn't sitting on their thumbs, unlike in the past where their graphics parts were a half assed attempt at a value-add, modern Intel graphics are increasing their performance at an incredible rate... sure, they're nothing in comparison to the really high end stuff, but they're quickly closing the gap with the sub-$200 adapters from AMD or nVidia. Another year or three and Intel won't be talked about as "I couldn't afford an extra video card, so I just used the Intel graphics", instead, they'll be talked about as "Oh... new generation of Intel graphics is out, I have to get a new CPU!"
So, nVidia and AMD, please stop lying to yourselves or to the investors and the world and realize that you won't be getting that market back. HPC, game consoles, mobile and integrated graphics is where you'll be earning in the future. High end cards for games won't matter much anymore.