At the 19th Annual JP Morgan Tech Conference, NVIDIA CFO, Colette Kress shared some details regarding the adoption of the GeForce RTX graphics cards, including the relative sales of the latest 30 series (Ampere) lineup. According to Kress, about 10% of all PC gamers are presently using an RTX graphics card which means a total of 20 million Turing and Ampere cards have been sold to date.
Right now, only 10% of our installed base is on RTX, and we’re moving quite quickly to work in terms of on that upgrade cycle that is ahead of us. Now, when we think about that upgrade cycle, we can continue to look at our overall installed base. Our installed base, can think about not only our last generation or generation even before that and looking at what possibility we have for an overall upgrade.
The RTX 3080 and 3070, based on the Ampere microarchitecture supposedly turned out to be twice as popular as their predecessors. It’s unclear whether NVIDIA is referring to the RTX 2070 and 2080 or their Super variants which were much more successful. We’re guessing it’s the former as that would be more practical considering the limited supply and stats we’ve seen lately.
When the topic of GPU shortages was brought up, the NVIDIA CFO admitted that there was a tremendous demand in the market which will continue into the second quarter of the year. While she didn’t a solid timeline, she believes that the shortages will persist into April, after which the supply should start getting better.
So, supply does remain tight at this time. We expect the overall channel inventories, meaning the inventories that are with our AIC partners as well as in our e-tail and retail channels will likely remain lean throughout Q1. Our overall capacity has not been able to keep up with that overall strong demand that we have seen. We’ve seen in terms of constraints, constraints really from the overall global surge of compute and the overall capacity, capacity that may be necessary for assembly and test and/or sub trades as well. But again, we remain focused on this and working each day to improve our overall supply situation.
The recent Bitcoin/Ethereum surge also came up during the conference, but Kress said that miners will have a minimal impact on demand, and if that changes, the company already has plans to ship special versions to miners with a reduced warranty and lack of output.
We don’t have visibility on how much of the RTX 30 Series end demand comes from mining. So, we don’t believe it’s a big part of our business today. Gaming demand is very strong, and we think that’s larger than our current supply. This time feels different than what we had seen several years ago for a couple of reasons. One, inventory levels are now very lean, and we have better visibility into that channel inventory, something that we are monitoring on a periodic basis and often to make sure we have an understanding where that inventory is in the world.
Additionally, we’re in the beginning of a product life cycle with overall Ampere architecture. It’s got a long runway ahead of us. And the last time, if you recall, we were transitioning from Pascal to Turing, which made it challenging to manage both, the channel inventory and the end of that product cycle, okay?
Lastly, on the topic of mobile gaming, NVIDIA now earns nearly 30% of its gaming revenue from notebook GPUs. While this number isn’t surprising, it is an indicator of the global shift towards the mobile GPU market and falls in line with Intel’s revenue figures from the notebook market.
So, laptops have been a wave over the last couple of years. We are on a multiple-year growth in terms of our overall notebooks. And our notebooks, if — are approaching nearly 30% of our overall gaming type of revenue that we have today. So, a great example of really innovating and showing how the gamers can learn how to game on many different types of devices. So, stay tuned. I’m sure you’ll hear more about our notebooks and our laptops for gaming as we move forward.
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