Demand for graphics processing units fell to a 20-year low in the third quarter of 2022, according to new data from industry analyst Jon Pedy Research.
Desktop graphics card sales fell to their lowest level since 2005 during the quarter, according to the report, making chip makers such as Nvidia Corp. and Advanced Micro Devices Inc. even more dismal. The pandemic happened because people wanted more powerful computing hardware while staying at home. However, with the global economic slowdown, the story has changed and demand is declining rapidly.
Jon Peddie’s 2022 GPU Market Brief Q3 report covers GPUs for desktops and laptops and central processing units with integrated graphics chips. According to the report, AMD, Nvidia, and Intel Corp. together shipped just under 6.9 million discrete desktop GPUs in the quarter, down 47% from the same period last year. By contrast, Jon Peddie said his GPU shipments were similar between Q4 2007 (when Nvidia’s 8800 GT launch hit a record high) and Q4 2008 due to the 2008 recession. in he said it was down 46%.
The two biggest players in the GPU market are AMD and Nvidia. The former was reportedly hit much harder than the latter. Nvidia’s discrete desktop GPU shipments fell by 40% while AMD’s sales fell by a staggering 74% year over year.
It’s no secret that the fate of the GPU industry is tied to the fate of the personal computer market, and it was clear that declining sales of PCs, tablets and smartphones would hurt GPU manufacturers. However, the GPU market has been further hit by unique factors. Data from Jon Peddie shows that GPU sales for cryptocurrency mining collapsed during the quarter. This could be related to his Ethereum merger, where he adopted a new consensus algorithm that does not require mining, which is the second largest decentralized network in the world. In the report, Jon Peddie points out that the withdrawal from the market has caused significant turmoil as Ethereum’s miner has helped inflate GPU sales and prices in recent years.
Jon Peddie pointed out that both AMD and Nvidia have launched new flagship GPUs this year, namely the Radeon RX 7000 and RTX 4000 series GPUs. These models are his high-end GPUs and both companies are planning to launch his low-end GPUs in 2023, which could boost sales.
Intel just entered the GPU market this year, with the entry-level Arc Alchemist series GPUs giving the company a 4% share of the overall market. Nvidia increased his market share by 10.2% to 86% overall, while AMD dropped to around 10%.
