The resounding fall of cryptocurrencies, in addition to influencing the financial ruin of some companies and individuals, brought with it a benefit that just a few years ago seemed far away. The stock, but above all the price of graphics cards, managed to stabilize —to a point—allowing a fair number of people to build or upgrade their PC’s GPU without breaking the bank.
However, when the GPU market seemed to return to a stage of stability without depending entirely on the crypto world, it stagnated again. According to research by the firm Jon Peddie Research, during the third quarter of 2022 this sector had its biggest drop since 2009, a year when the world was being hit by a major recession. Specific, GPU shipments fell 25% compared to the same period of the previous year.
In his research, Jon Peddie Research makes it clear that when he mentions GPUs, he means the entire market for graphics processing chips, not just cards. In addition, always according to the report, the third quarter is usually distinguished by exceeding the immediately preceding period, but this year that trend was broken. Shipments in Q3 decreased by 10.3% in relation to the second quarter.
Now we go to the most interesting. Why has this happened? It would be logical to think that, after the cryptocurrency crash, miners stopped buying GPUs in large volume and this is the sole cause of the crash. Because the rest of us mortals continue to acquire GPUs with great enthusiasm, right? Well, that’s not entirely correct.
The crash of GPUs beyond crypto
Although the collapse of the crypto has an influence, there are other factors that are presenting themselves. Firstly, China is suffering from new waves of COVID-19, which has caused the temporary closure of plants dedicated to the production of devices that integrate GPUs.
On the other hand we have the osborne effect, which basically consists of delaying the purchase of a product because, soon, it will be replaced by a newer one. Interestingly, the third quarter of 2022 was marked by the presentation of Nvidia’s RTX 4000, which can already be purchased in its 4090 and 4080 variants. Likewise, customers who prefer AMD’s proposals were waiting for the Ryzen RX 7000, whose commercialization starts in December.
There is a third point that is also influencing, and with which a good part of consumers will surely feel identified. Today, GPU prices remain highmore when we talk about the most recent models.
If someone had told us a few years ago that Nvidia was going to release a $1,500 or €2,000 graphics card, we might have laughed. However, this is the starting price of the 4090. And the lower potential versions are not far behind. AMD, for its part, is betting on keeping costs “low” in relation to its competition; but that doesn’t mean the RX 7000 hasn’t gone up in price considerably.
The next and last factor is closely linked to the previous one. GPU manufacturers have increased their prices as the world is going through a tough economic landscape. Currently, not everyone can afford to pay those amounts. And those who are in a position to do so, study their cats beforehand.
Despite all of the above, from Jon Peddie Research they believe that it is not yet time to sound the alarms. Something that can benefit the GPU market in economic terms is that, even though shipments and sales are down, high prices will help make up for it.