Nvidia gaming GPU revenue now makes up just 7% of total revenue lmao

[Alxndr]

https://i.imgur.com/ry5h65o.jpeg

We are witnessing the literal death of Nvidia's gaming arm.

$2.5b revenue on a $40b revenue company is laughably small. I just can't see a reason why Nvidia even bothers to keep the gaming GPU department running, they're making pennies from it all things considering.

Nvidia will pull their gaming GPU department probably within the next 3 years. Soon the only options we will have will be AMD and Intel 😬

Think about it logically, if you run a business where only 7% of the income comes from a certain department. Are you going to continue funnelling money, resources and people into that department or are you going to focus those resources and people on the thing that actually makes 90% of the profit?

It's over boys. I reckon we get 1 last blowout 60 series and then they're going to shut shop and leave AMD and Intel to duke it out.

[󠀡󠀡󠀡󠀡⁧⁧Kei]

they make the highest end gaming cards, that's all that matters for those who are chasing frames.

[Alxndr]

Originally posted by 󠀡󠀡󠀡󠀡⁧⁧Kei:

they make the highest end gaming cards, that's all that matters for those who are chasing frames.

Give it 3 years and they won't be making any gaming cards because there's no meaningful profit to be made.

[󠀡󠀡󠀡󠀡⁧⁧Kei]

Originally posted by Alxndr:

Originally posted by 󠀡󠀡󠀡󠀡⁧⁧Kei:

they make the highest end gaming cards, that's all that matters for those who are chasing frames.

Give it 3 years and they won't be making any gaming cards because there's no meaningful profit to be made.

that would suck because we would be left with mid to high ish end AMD and the low end intel crap

[C1REX]

7% is big enough to keep it and make it as big as possible.
The problem with gaming GPUs is that it takes away limited allocated silicone from AI and other more profitable options.
TSMC in Taiwan having basically a monopoly for all gaming GPU manufacturing is a problem.

[Alxndr]

Originally posted by C1REX:

7% is big enough to keep it and make it as big as possible.
The problem with gaming GPUs is that it takes away limited allocated silicone from AI and other more profitable options.
TSMC in Taiwan having basically a monopoly for all gaming GPU manufacturing is a problem.

That's not 7% profit... That's 7% revenue

Their profit margin is probably half that.

[ᶻ𝗓𐰁]

Originally posted by Alxndr:

Think about it logically, if you run a business where only 7% of the income comes from a certain department. Are you going to continue funnelling money, resources and people into that department

Yes, because 2.5bn is a lot of money and my shareholders will be unimpressed if I tell them profits are down because I don't feel like operating my business.

[Chaosolous]

7% of billions upon billions of dollars is still a lot of money.

[Dwerklesberry]

Originally posted by Chaosolous:

7% of billions upon billions of dollars is still a lot of money.

Yes but every gpu is silicon that could have been an AI accelerator instead at much highe rprofits, the allocation of fabs is very limited.

[Alxndr]

Originally posted by Chaosolous:

7% of billions upon billions of dollars is still a lot of money.

Nvidia made $40billion of revenue this quarter. 7% of that ($2.8billion) was from gaming GPUs. Of that $2.8billion revenue, Usually profit margins are around 30%. So 30% of $2.8b = $840million.

To me and you that sounds like a lot of money, but to a multi trillion dollar company it's pennies. And it's not like it's free money, they have to dedicate resources, people and time into churning out newer more powerful graphics cards.

And what does Nvidia get in return? Pennies worth of profit and a heap load of unhappy customers... If they diverted the time and people they spent on gaming GPUs into their data centre GPU / AI department it would probably be better value for money.

I could be wrong but there's a reason Nvidia no longer gives a damn about the gaming GPU market. It's simply an afterthought for them now.

[A&A]

I hope you realise they had a gross margin of 55% in 2017 and now it is 75% because they are charging premium for their server and workstation GPUs???
Nvidia is not going anywhere. They will keep making cards because they have a stable market share anyway and it is an income.
Anyway, the average consumer always eat the worse silicon anyway, tnx to binning the processors.


Btw does it mean they should stop these departaments too?
- Professional Visualization (Workstation GPUs) 511M
- Automotive and Robotics 517M

[Chaosolous]

I'm not quoting it because it's long, but any company that says "No, I do not want to make profits because that's a lot of work." is not a company.

2.8 billion in profits is a lot of money, even if comparably it's not as much as they currently have. Anyone who would ignore that is a fool.

"We made so much money that making more money than most other companies just isn't worth it anymore."

No company would say "I'd rather make no money than some money." In this case, "some money" for Nvidia just happens to be billions and billions of dollars.

[C1REX]

AI bubble can burst any moment. It may be actually happening right now thanks to Chinese more efficient training models that work even on AMD and on Chinese GPUs.

Also there is a silver lining to everything. Many players are happy seeing huge progress each GPU generation but others would love a GPU stagnation and no need to upgrade for longer periods.

[Tonepoet]

Why would they cut off a revenue stream instead of expanding operations to accommodate both? They have a pretty sweet deal going on in the G.P.U. market with a practical monopoly, alongside a highly successful partnership with Nintendo, and the deversification gives them something to fall back upon if their made revenue stream goes sour.

Nvidia lost like, 600 billion dollars in value recently just because some competition showed up in the A.I. space. Sure they recovered in short order, but that really has to serve as a wakeup call. A diversified portfolio of products is a safer bet.

Also, you're basically saying is that they just want to throw away 7% of their profits for nothing. That's not how business works. They need to gain something of greater value by shedding the gaming department for that to be a worthwhile option.

Maybe if they could reallocate their gaming resources into something more profitable that'd make sense, but if their G.P.U. dept. is doing a good job, and you can't really do anything else with them then the status quo continues.

Heck, most of Intel's profits don't come from G.P.Us. either but they are making the Arc cards. Intel just entered this market, and experienced at least enough success in it to make Battlemage cards.

Something else to be noted is that most of Nvidia's brand name recognition is tied into their history as a graphics card company.

70% of Disney's operating income come from the theme parks[www.forbes.com], but they still make movies, and they even expanded into buying the entertainment media library of other countries to launch Disney+ Streaming. services.

What you're proposing is something akin to Disney stops making movies because their theme parks make most of the money. Seems pretty unlikely to me, especially since many of their recent movies have been box-office flops and they still haven't shuttered down the animation studios.

Originally posted by Dwerklesberry:

Yes but every gpu is silicon that could have been an AI accelerator instead at much highe rprofits, the allocation of fabs is very limited.

That makes some amount of sense, but using that logic Taiwan Semiconductor might as well just stop making low end end consumer chips altogether. Market saturation has to be taken into consideration too.

[DevaVictrix]

Death of nvidia gaming? They released…

“Fourth-quarter Gaming revenue was $2.5 billion, down 22% from the previous quarter and down 11% from a year ago. Full-year revenue rose 9% to $11.4 billion.”

https://nvidianews.nvidia.com/news/nvidia-announces-financial-results-for-fourth-quarter-and-fiscal-2025

AMD released…
“ Gaming segment revenue in the quarter was $563 million, down 59% year-over-year, primarily due to a decrease in semi-custom revenue.
For 2024, Gaming segment revenue was $2.6 billion, down 58% compared to the prior year, primarily due to a decrease in semi-custom revenue.”

https://ir.amd.com/news-events/press-releases/detail/1236/amd-reports-fourth-quarter-and-full-year-2024-financial

I haven’t read what Intel are reporting… big figures I guess if this is Nvidia’s gaming arm ‘literal death’

Edit: Intel don’t even segment it out but for the entire business…
“ Fourth-quarter revenue was $14.3 billion, down 7% year-over-year (YoY). Full-year revenue was $53.1 billion, down 2% YoY.”

https://www.intc.com/news-events/press-releases/detail/1726/intel-reports-fourth-quarter-and-full-year-2024-financial

Nvidia are so far ahead! It grew overall when the others shrank.

[Ice Robertson]

Nvidia gaming GPU revenue now makes up just 7% of total revenue lmao

People want cheaper graphics cards but with your statement i don't see that happening.

They need to make their gpu's cheaper so they can make more profit and still sell the cards cheaper.

I guess it's a balancing act.