From www.tomshardware.com
Gamers searching for cheap graphics cards during the holiday season might be in for disappointment. While Nvidia’s earnings for the third quarter beat analyst expectations as it doubled its profits year-over-year, mainly due to massive strides in the data center market and gaming revenue also saw a healthy uplift, Nvidia’s CFO (Chief Financial Officer) Colette Kress sounded an alarm during the earnings call, saying there’s a potential gaming GPU supply shortfall coming this quarter.
There are a lot of potential factors to consider, including the upcoming consumer Blackwell RTX 50-series launch, the wind-down in RTX 40-series production, and the existing shortages of top-tier RTX 40-series models. There’s also increased demand from the AI and data center sector, which is currently far more lucrative than consumer GPUs.
With the hints of a gaming GPU supply shortage due to supply constraints, it remains to be seen whether this will lead to actual shortages or only result in near-term higher pricing as gaming GPUs become more scarce. And having this happen right amid the holiday shopping season, with a potential boost in ASPs (average sale prices), it’s not exactly a bad situation for Nvidia — the company gets to clear out remaining Ada inventory at a premium in advance of the next-gen GPUs — though we don’t expect lower-end models to come until later in 2025.
Despite Nvidia’s Blackwell GPUs looming over the horizon, the gaming segment still brought in $3.2 billion — 15% more than last year. However, beyond the impressive numbers, Nvidia’s CFO warned of a GPU supply-demand mismatch this quarter.
When asked for further clarification later during the earnings call, she said, “Our gaming supply, given what we saw selling through, was moving quite fast. Now the challenge that we have is, how fast could we get that supply getting ready into the market for this quarter? Not to worry, I think we’ll be back on track with more supply as we turn the corner into the new calendar year.”
The rumor mill has it that Nvidia decided to cut back RTX 40-series production to make room for a Blackwell launch in January. This is seemingly backed by reports of shortages and recent price hikes, especially in the case of the RTX 4090. The statement thus becomes self-explanatory for the RTX 40 series.
This could also mean that the initial RTX 50-series supply might be bottlenecked. Nvidia is expected to begin shipping chips to AIBs this quarter, though there’s as yet no official confirmation. It’s widely expected that Nvidia will reveal the first consumer Blackwell GPUs at CES 2025 in January, likely with the top two models, RTX 5090 and RTX 5080. CEO Jensen will take the stage in January to unveil Nvidia’s next generation of GPUs.
Given the stated timing, this shortage will likely only affect the remaining RTX 40-series supply, especially for laptop sales during the holiday season. Leaks suggest that Nvidia will continue producing select RTX 40 mobile chips, selling them in parallel with their RTX 50 counterparts.
Going over the financials, Nvidia’s revenue surged to a staggering $35 billion, a 94% bump year-over-year. The net income or profits spiked to $19.3 billion, landing Nvidia a sizeable 109% increase compared to Q3 23. A massive chunk of this increase is due to Nvidia’s H100/H200 and Blackwell B100/B200 offerings, with the data center segment contributing $30.7 billion to Nvidia’s total revenue (approximately 87.7%). Considering that breakdown, it’s no surprise that Nvidia might prioritize data center parts over consumer GPUs.
[ For more curated Computing news, check out the main news page here]
The post Nvidia warns of gaming GPU shortage this quarter, recovery in early 2025 — Chipmaker rakes in record profits as net income soars by 109% YoY | Tom’s Hardware first appeared on www.tomshardware.com