EVGA terminates relationship with NVIDIA; cites disrespectful treatment

[Flappy Pannus]

No more gobs of mining money and Nvidia forces us to adhere to MSRP for Lovelace. How disrespectful.

Who knows without concrete numbers, but as JayZ mentioned in his videos, the reports of very low margins is common for all AIB's. The point is that Nvidia's MSRP is fine - for Nvidia. It leaves very little on the table for AIB's when their R&D for their own boards and retail markup/marketing is taken into account. This was different when Founders Edition cards were $100 over MSRP, they're not now.

 

[Silent_Buddha]

GeForce GPUs are 80% of EVGA’s revenue—but it’s cutting ties with Nvidia anyway

EVGA will continue selling current-gen GeForce cards until it runs out of stock.

arstechnica.com

Ouch on that graph showing that NV AIB partner's margins decreased over time while NV margins massively increased over that same period of time.

Also, ouch. EVGA represented 40% of NV GPUs sold in NA.

Peddie says that EVGA represents about 40 percent of Nvidia's GPU market share in North America

Regards,
SB

 

[Malo]

Note all of these 3rd party cards now "on sale" for "amazing prices" are still above MSRP despite the imminent launch of nex-gen. That's not a sale.... and they are holding inventory regardless on a 7nm gen product. Compare to CPUs, motherboards, etc. It makes no sense unless.....

High end cards are well below MSRP. EVGA FTW3 3090 is $999 for example. The mid range are still holding their price for the moment.

 

[digitalwanderer]

That graph is mega-depressing.

 

[Subtlesnake]

In the video, Steve thinks EVGA's story is full of holes, apparently EVGA is losing big on the retained inventory they overprovisioned during cryptoboom, some family matters with the CEO of EVGA are also to blame.

The "family matters" were never explained and the inventory decision has already been made so shouldn't be a factor in deciding to forego the revenue stream for future products. IMO it makes most sense if EVGA's BOM is higher due to using better quality components and they are unable to be profitable with the margins given by Nvidia.

 

[DegustatoR]

The "family matters" were never explained and the inventory decision has already been made so shouldn't be a factor in deciding to forego the revenue stream for future products. IMO it makes most sense if EVGA's BOM is higher due to using better quality components and they are unable to be profitable with the margins given by Nvidia.

Are there any actual data of them using "better quality components"?

 

[doob]

GeForce GPUs are 80% of EVGA’s revenue—but it’s cutting ties with Nvidia anyway

EVGA will continue selling current-gen GeForce cards until it runs out of stock.

arstechnica.com

Ouch on that graph showing that NV AIB partner's margins decreased over time while NV margins massively increased over that same period of time.

Also, ouch. EVGA represented 40% of NV GPUs sold in NA.



Regards,
SB

It's beyond ouch, it's a put me out of my misery death cry. If i were a CEO of a company like EVGA i would have made this same decision a decade ago.

 

[techuse]

Just from an enthusiast perspective it seems like every company who works with Nvidia has a bad experience and would quickly cease given any viable alternative.

 

[DegustatoR]

Just from an enthusiast perspective it seems like every company who works with Nvidia has a bad experience and would quickly cease given any viable alternative.

Asus, Gigabyte, Palit, Foxconn, etc says hi.

 

[Rurouni]

Asus, Gigabyte, Palit, Foxconn, etc says hi.

They probably would ditch Nvidia if there is an alternative. On the WAN show someone asked something about Asus with Nvidia and according to Linus source it seems they weren't happy either.
The thing is, there is still no alternative to Nvidia. AMD with 6000 series is only catching up in raster performance. Even if AMD managed to make a card that is matching all of Nvidia features and performance (including RT and AI) it is only going to be competitive enough for the gaming space. For productivity, most apps are optimized for Nvidia.
Basically as much as I don't like Nvidia business practices, I still need their GPU. My office just bought an RTX card upon my recommendation simply because going with RTX card is the only option.

 

[DegustatoR]

They probably would ditch Nvidia if there is an alternative.

Oh you don't say. I'd wager they would just run to any "alternative" who would just gift them money for no reason at all. But here we are, in the real world.

 

[Rurouni]

Oh you don't say. I'd wager they would just run to any "alternative" who would just gift them money for no reason at all. But here we are, in the real world.

Like I've said, yes, they probably would, but if there is an alternative. And like I've explained above, unfortunately there is no alternative to Nvidia right now. AMD could stop making and supporting their GPU right now and the world will keep moving, but if Nvidia stop their business right now, there will be a lot that get affected by it.

 

[arandomguy]

GeForce GPUs are 80% of EVGA’s revenue—but it’s cutting ties with Nvidia anyway

EVGA will continue selling current-gen GeForce cards until it runs out of stock.

arstechnica.com

Ouch on that graph showing that NV AIB partner's margins decreased over time while NV margins massively increased over that same period of time.

Also, ouch. EVGA represented 40% of NV GPUs sold in NA.



Regards,
SB

I'm extremely skeptical with respect to that graph and wonder how they derived that, especially with the context of the crypto boom of the last 2 years. EVGA isn't a publicly traded company and so we do not know there finances but other AiBs are and have to report.

This is PC Partner which is an Nvidia AiB (you might know them more from brand names such as Zotac).

PC Partner

www.pcpartner.com

PC Partner revenue by product segment - VGA = 13570 , Other = 1889. VGA revenue as percentage = 87.8%.

2020 Revenue = 7,762

2021 Revenue = 15459

YoY revenue growth = 99%

2020 Gross Profit = 795

2021 Gross Profit = 4287

YoY gross profit growth = 439%

Proportional growth in terms of profit/revenue is several times higher than Nvidia reported during the same time period.

There seems to be this narrative that some parties are pushing trying to alleviate AiBs of their part in profit taking off the crypto boom.

 

[Phantom88]

Are there any actual data of them using "better quality components"?

There's data of them using cheap or standard components actually and selling the FTW models for premium prices for no reason at all. I think Buildzoid did a PCB review and those were his findings, EVGA was using regular components while asking higher prices. Nevermind their backplate which doesnt connect to anything to help with heat, it's just a piece of metal hovering above the components.

Also, looking at neweggs best selling gpu's, there's nothing to suggest that evga has a 40% marketshare in america. The list is dominated by everyone else than EVGA.

https://www.newegg.com/d/Best-Sellers/Desktop-Graphics-Cards/s/ID-48?nm_mc=AFC-RAN-COM&cm_mmc=AFC-RAN-COM&utm_medium=affiliates&utm_source=afc-Future+Publishing+Ltd&AFFID=2294204&AFFNAME=Future+Publishing+Ltd&ACRID=1&ASUBID=tomshardware-us-6733873038060455000&ASID=https%3A%2F%2Fwww.tomshardware.com%2Fnews%2Fnewegg-best-sellers-dominated-by-nvidia&ranMID=44583&ranEAID=2294204&ranSiteID=kXQk6.ivFEQ-1aLFIbk8qmwYtbwIg27zRw

They actually have 4 models on the first page now. A month ago there were just 2 evga cards out of 20 in the best selling page.

 

[dorf]

No more gobs of mining money and Nvidia forces us to adhere to MSRP for Lovelace. How disrespectful.

Is this a strawman or did EVGA really call Nvidia's conduct disrespectful for those reasons?

 

[Kaotik]

Is this a strawman or did EVGA really call Nvidia's conduct disrespectful for those reasons?

It's a strawman

 

[DavidGraham]

It's a strawman

Absolutely not, did people here actually care to watch the video in the first post of this thread?

I will say it once more, Steve is stating EVGA's story is one sided and full of holes, he is not convinced their reasons actually hold up.

And EVGA did claim NVIDIA is forcing them to sell at certain prices which makes life harder for them to actually make good magins.

Nothing here is new, Club3D suffered the same fate, they ceased making NVIDIA cards, made two generations of AMD cards then stopped making graphics cards all together. Same with Sparkle, Point of View, Diamond, HIS is not making new AMD cards too,

Why Andrew Han killed his GPU division instead of stepping down as CEO? Why immediately after the crypto crash? Some people just like to blame others if their business moves don't go as planned, It's all about profits.

 

[Kaotik]

Absolutely not, did people here actually care to watch the video in the first post of this thread?

I will say it once more, Steve is stating EVGA's story is one sided and full of holes, he is not convinced their reasons actually hold up.

And EVGA did claim NVIDIA is forcing them to sell at certain prices which makes life harder for them to actually make good magins.

Nothing here is new, Club3D suffered the same fate, they ceased making NVIDIA cards, made two generations of AMD cards then stopped making graphics cards all together. Same with Sparkle, Point of View, Diamond, HIS is not making new AMD cards too,

Why Andrew Han killed his GPU division instead of stepping down as CEO? Why immediately after the crypto crash? Some people just like to blame others if their business moves don't go as planned, It's all about profits.

Did you bother checking the other videos and articles on the issue, or you're just happy with one view because you happened to like it?

edit: oh, and Club3D was the first ATi AIB partner. They did a bit more than "two generations of AMD cards" and started doing them years before doing a single NV card (AMD/ATI being same in this context) and didn't stop making them when they started doing NV too.
edit2: and Sparkle never did AMD products outside embedded space
edit3: also Andrew Han is either CEO appointed by owner or actual owner of EVGA, why would he step down? It's a private company.
last edit I promise: The decision to quit was made in april, quite a bit before the crash

 

[DavidGraham]

Did you bother checking the other videos and articles on the issue,

Yeah I did, read johnpeddie's piece too, no one dug into the issue like Steve did though.. most of them took EVGA's story at face value, I suggest you do the same and start doing a little of critical thinking or logical analysis before you are convinced of a story because you like the feeling of it.

 

[Kaotik]

Yeah I did, read johnpeddie's piece too, no one dug into the issue like Steve did though.. most of them took EVGA's story at face value, I suggest you do the same and start doing a little of critical thinking or logical analysis before you are convinced of a story because you like the feeling of it.

I have done the same and am saying there's no smoke without fire, and this isn't the first sighting of said smoke. Surely EVGA like anyone spins things in their favour, but that's far cry of lying. Critical thinking doesn't automate coming to same conclusions as you did.

You might want to open a history book or two, too, since your post got things factually wrong - things that aren't hearsay one way or another.