Home / Trends / AMD is losing ground to NVIDIA – and it could get worse

AMD is losing ground to NVIDIA – and it could get worse



modern micro devices (NASDAQ: AMD) lost ground to arch rivals NVIDIA (NASDAQ: NVDA) In the discrete graphics card market in the second quarter, according to the latest report from Jon Peddie Research.

AMD ended the quarter with only 22% of the discrete GPU (graphics processing unit) market, a significant decrease from 32% in the same period last year. NVIDIA regained ground and ended the quarter with a market share of 78%. Coronavirus-induced shelter-in-place orders spurred an increase in video game activity, which in turn spurred a surge in graphics card sales, and NVIDIA made the most of it.

News of this setback for AMD comes at a time when the stock was trading near all-time highs following the release of a new entry-level graphics card. Additionally, NVIDIA will be exposed to more heat when the first of its new Ampere graphics cards launches later this month. None of this bodes well for AMD ̵

1; its share price had doubled since the start of the year, but the stock was down over 13% in September as investors digest signs of weakness in the company’s business.

Let’s see where AMD might fall short and why the loss of market share is a worrying sign.

Stacked graphics cards.

Image source: Getty Images.

NVIDIA is doing everything it can to promote the RTX 30 series to gamers

AMD lured a significant portion of NVIDIA’s GPU market share away from NVIDIA in the first quarter thanks to competitively priced products like the Radeon RX 5700 series. NVIDIA, however, weakened its pricing power and lowered the price of its mid-range RTX 2060. Following the recently announced RTX 30 series graphics cards, which are based on the new Ampere architecture, further GPU price reductions followed in the second quarter.

By making its offerings affordable, NVIDIA has stolen market share from AMD, a trend that may continue given the fact that the RTX 30 series cards are being launched at aggressively priced locations. The flagship GeForce RTX 3080 starts at $ 699. This is the same price that the previous generation RTX 2080 was released at.

What is impressive, however, is that NVIDIA claims a 2x performance leap and a 1.9x improvement in energy efficiency compared to the previous generation Turing cards. AMD has one more reason to worry when it comes to its own RX 5700 graphics cards, as NVIDIA’s older offerings are likely to be further reduced in the future.

Additionally, NVIDIA has announced that the RTX 3070 will sell for $ 499, claiming it will be faster than the RTX 2080 Ti, which previously sold for $ 1,200. No successor to the RTX 2060 has been announced yet – this graphics card was originally launched at CES 2019, three months after the RTX 2080 and RTX 2070 launched, priced at $ 349. Based on this schedule, the RTX 3060 could hit the market a few months later. This could create even more problems for AMD if NVIDIA can get another significant leap in performance for the same price over the holiday season.

AMD now has a mountain to climb

AMD’s next generation RDNA2 GPUs are expected to hit the market soon as well. The company has already claimed that its new architecture can deliver a 50% performance leap per watt, but it remains to be seen whether that will be enough after NVIDIA’s generational leap and the promised performance and efficiency gains.

The RDNA2 architecture is a refined version of the existing RDNA architecture. Both are based on a 7-nanometer node, which is why the gains AMD promised are likely not as high as those NVIDIA claims with its RTX 30 cards. Finally, the new RTX 30 cards are manufactured using an 8-nanometer manufacturing process, while the RTX 2080 is based on the 12-nanometer Turing architecture.

Moving to a smaller process node is why NVIDIA could make the promised profit on its new cards, while refining an existing process could result in limited profits for AMD and make it more difficult for the soaring chipmaker to compete.




Source link