This week, Jon Peddie Research (JPR) released their much anticipated quarterly discrete video card sales report for Q4 2017.

Overall, the research firm is reporting a 4.6% decrease in graphics add-in board (AIB) shipments from last quarter. According to JPR, this is in line with their seasonal ten-year Q3-to-Q4 average of -4.4%; and yet despite this, Q4 was hardly a normal quarter in the industry. As many long-time readers are already well aware, Q4 is when GPU cyrptocurrency mining came back with a vengeance, and indeed without mincing words, the report attributed Q4 2017’s figures to a combination of cryptocurrency mining demand inflating average selling prices, as well as seasonality.

Interestingly it's arguably the latter point that's the more salient. While cryptocurrency prices have affected prices, the long ramp-up/ramp-down cycle for beginning-to-end video card production means that the industry can't radically alter volumes inside a single quarter. In other words, GPU manufacturers and their partners have to plan for the quarter in advance, and a typical Q4 plan would involve tapering back on production a bit to match the traditional seasonal demand.

In total, JPR estimates that over three million graphics cards were sold to cryptocurrency miners, adding up to $776 million in sales. Of these sales, AMD benefitted the most - as one might expect from their early performance advantage in cryptocurrency mining performance. As a result, AMD’s discrete desktop graphics market share is up 6.5 percentage points from Q3 2017, increasing to 33.7%, while NVIDIA’s stands at 66.3%.

Discrete Desktop GPU Market Share
Data by Jon Peddie Research
  Q4'2017 Q3'2017 Q4'2016
AMD 33.7% 27.2% 29.5%
NVIDIA 66.3% 72.8% 70.5%

In the public report, it was not specified how much of the market share change was attributable to disproportionate mining sales. Nevertheless, this brings AMD’s share to the highest it has been since Q2 2014. Including all desktop and notebook GPUs, market share remains fairly similar to last quarter, with AMD picking up 1.2%, Intel down 0.4%, and NVIDIA down 0.9%. AMD’s overall GPU shipments were up 8.08% from last quarter, while Intel’s total shipments were down 1.98% and NVIDIA’s down 6%.

Total GPU Market Share
Data by Jon Peddie Research
  Q4'2017 Q3'2017 Q4'2016
AMD 14.2% 13.0% 14.4%
Intel 67.4% 67.8% 68.1%
NVIDIA 18.4% 19.3% 17.5%


Change in GPU Unit Shipments by Segment
Data by Jon Peddie Research
  Quarterly Change Annual Change
Discrete Desktop -4.6% 9.7%
Desktop Integrated and Embedded 3.0% -8.3%
Desktop Total -0.1% -2.1%
Discrete Notebook 3.6% -5.6%
Notebook Integrated and Embedded -3.7% -6.8%
Notebook Total -2.3% -6.5%
All Total -1.45% -4.8%

JPR did note that the high-end ($250+) and mid-range ($150 – 249) segments continue to expand, while the lower-end mainstream ($90 – 149) stagnates. Though not part of the report itself, this trend is consistent with higher-end cards being favored for mining due to better performance per watt and per dollar. At the same time there's some natural pressure as well: as integrated graphics capabilities improve, this trend is likely to persist. Just last month AMD released their new generation of APUs, with graphics performance of the Ryzen 5 2400G on par with the entry-level discrete graphics.

Graphics Segment Market Share
Data by Jon Peddie Research
  Q4'2017 Q4'2016
Mainstream ($90 - $149) 26.1% 39.2%
Mid-range ($150 - $249) 51.7% 41.5%
High-end ($250+) 16.0% 11.5%
Workstation 6.3% 7.8%

As far as cryptomining demand goes, JPR expects the tapering off to continue, and otherwise remain volatile, an outlook similar to those of both NVIDIA and AMD. However, JPR warns that “[inflated AIB] prices will not drop in the near future.” The decline has not been straightforward, and NVIDIA stated for their recent quarterly report that cryptomining contributed more to revenue than last quarter on a percentage basis; in context, NVIDIA had accounted cryptomining board sales to total to around $70 million for fiscal Q3 2018 and $150 million for fiscal Q2. Compounding matters is the ongoing GDDR5/HBM2 memory shortage, which is further bottlenecking video card production.

In their respective quarterly financial calls, both GPU vendors reiterated their focus on consumer gaming over cryptocurrency mining. Though ultimately neither vendor has the ability to completely restrict sales to a single group due to the nature of the open market.

Source: Jon Peddie Research



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  • HStewart - Thursday, March 1, 2018 - link

    "It's pretty simple. Every GPU you can buy generates money. People like money. "

    Well I think this stuff will burst one day, when people realize it not real money - but generated by GPU. It got to have real value backing it. So if demand is based on it - this demand is imaginary and once it burst, people will excess machines hat do nothing

    Maybe one could give them to their kids to play games.
  • BenSkywalker - Thursday, March 1, 2018 - link

    Cryptocurrency is a fiat currency, it has nothing backing it besides what people think it's worth.

    Other notable fiat currencies are the Euro and the U.S. Dollar.
  • willis936 - Thursday, March 1, 2018 - link

    Uhh what cryptocurrecies are you looking at that are fiat? Fiat are what they replace. Reply
  • npz - Thursday, March 1, 2018 - link

    I don't think you know what fiat means. Fiat money means creation of money by decree, with no effort or work or resource put into it. "Fiat" as in by royal decree. That's how government central-banked curencies work and they implement their fiat monopoly into law.

    So by definition cryptocurrencies cannot by fiat, because no one can just wish for its creation of more units and then "by fiat, thy will be done". It rather, equivalent to digital gold or digital scare resource that anyone can work-to-gain. Exactly like the days before fiat money.

    It's not going to burst because there will always be demand for it--the currencies as a medium of exchange, especially cross-border settlement without interference--and the blockchain as trusted source of records and contracts.
  • npz - Thursday, March 1, 2018 - link

    All paper money's inflationary nature is a result of government/central banking's fiat nature, where as all cryptocurrencies deflationary nature (more you mine, less there is, more difficult the mining becomes) is a result of its NON-fiat increasing-scarity-algorithm for all nature. Reply
  • BenSkywalker - Thursday, March 1, 2018 - link

    I'm not sure if you don't actually understand fiat currency, or if you don't understand the cryptocurrency market. You want crypto by decree- first and most obvious example would be Ripple. If you aren't familiar, look it up. That is entirely 'by decree'(Ripple is the most popular example, there are others). Outside of that though, printing presses/coin stamps were traditionally always used to handle actual money- someone decreed it then a machine actually made it. How do you distinguish between a printing press or a GPU? On any logical basis someone, be it the creators of BitCoin/Ethereum et al decreed the currency would exist- out of nothing- and then machines were used to actually 'create' the currency.

    So, is your confusion lack of understanding of fiat currency, or lack of understanding of cryptocurrencies? I know there are the ideological purists who support crypto who want to try really hard to pretend it isn't fiat, but even if we use the super loose quantitative easing type currency creation- Ripple($36B market cap as I type this) and others like it have shown that even that is alive and quite well represented in the crypto market.
  • npz - Thursday, March 1, 2018 - link

    What? XRP -- the internal currency Ripple uses is most certainly not fiat. It works similar to any other cryptocurrency or any real resource for that matter: fixed limited supply and increasing scarcity. NO ONE can create any more!! The only difference being that it's available to the network at the beginning and is used to settle transactions so that people can exchange it and use it without any counterparty risk. But once again, unlike the fiat dollar created and inflated on demand by decree, there is a FIXED supply of XRP and NO MORE can ever be created.

    And once again you bring up your lack of understanding: on stamps or paper notes -- anyone can print those out and offer them as their as their own form of money. BUT what makes it valueable is divisibility, fungibility and most of all: SCARCITY. That is what you don't understand about a printing press and a GPU. Mining with a GPU is exactly analogous to mining with physical resources. So you should turn around and ask yourself: what's the difference between mining real gold and a printing press? After all, (let's assume bare frontier land) literally anyone can go out and mine in exactly the same way anyone can print their own paper notes. Think about the differences some more please.
  • BenSkywalker - Friday, March 2, 2018 - link

    Are the unicorns or the leprechauns keeping Ripple at a finite supply, and which divine force of the universe brought Ripple into existence? Reality check- they created it in the first place- they arbitrarily went from 0 to 39 billion. Trying to do mental gymnastics and say that isn't directly, entirely, and profoundly 'by decree' is something that is far beyond me. It didn't exist- someone says it does so there are 39 billion...... not by decree? Really?

    You attempting to claim that mining with a GPU is comparable to the actual physical act, particularly for gold, is quite frankly so stupid it is painful. If all of civilization disappeared today a million years from now an alien race coming to Earth would find value in gold because of its unique physical characteristics. You can say that we inflate the value based on its societal status and perception, but its' raw physical characteristics give it a value that simply can't be denied by anyone with even an elementary understanding of metallurgy.

    Now- if society disappeared today, how much would cryptocurrencies be worth? How much would the US dollar be worth?

    You can not, with an iota of intellectual honesty, even try to pretend that GPU mining is somehow comparable to the extraction of valuable resources, to do so is either shockingly dishonest or profoundly ignorant.
  • BenSkywalker - Friday, March 2, 2018 - link

    Forgot to mention- you keep wanting to talk about finite or not finite- that isn't, in any definition, a metric used to judge if a currency is fiat or not. Every cryptocurrency was created by a decree- every cryptocurrency has its' value assigned by what the market determines it is worth, every cryptocurrency has nothing material backing its value.

    Your obsession with supply versus demand would be akin to me talking about the orange commodity market in this discussion. I could easily demonstrate why there are relevant parallels, but at the end of the day it is a stupid strawman.
  • Reflex - Sunday, March 4, 2018 - link

    "especially cross-border settlement without interference"

    This comment is always really odd to me. I've travelled a lot and I've purchased a lot in other countries. This is a solved problem with the existing monetary system. I pay no special fees on my Chase card or my credit union debit card to buy things in other countries. Even getting local cash out has a very low fee (the local bank, not my bank charges it sometimes). I can buy anything at any value quite easily with my USD bank accounts and credit cards and incur little to no transaction fees. And I can send money to friends or family overseas for the same minimal or no transaction fees.

    What problem is being solved in that space by cryptocurrencies?

    The biggest limitation I run into with foreign purchases is not getting the money available to purchase it, Visa takes care of that. The largest issue is the local laws on what I am permitted to own. Bitcoin does not change the fact that I cannot legally purchase and title a house in China in my name. And that is how the control will still be in government hands regardless of the currency used. I already can spend other currencies in most of the world either directly or by exchanging it, what I can't do is get around ownership laws and what is or is not a legal purchase.

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