hot potatoes: The relationship between Nvidia and one of its top board partners appears to have reached a breaking point. EVGA won’t produce RTX 40 GPUs, effectively cutting out the graphics card market altogether. Perhaps declaring the end of EVGA, the decision could draw greater attention to business interactions between GPU makers and board partners.
In an exclusive report, EVGA told Gamers Nexus that it will not sell Nvidia graphics cards after the RTX 30 series. The company will continue to support existing customer warranties but expects to sell through its remaining inventory by the end of 2022.
The main reason for the fall is that Nvidia’s Founders Edition 30 series GPUs have undermined the EVGA-specific variants of these cards, especially since Nvidia has become important recently Price cuts To clear inventory.
GPU makers ramped up supply in response to the cryptocurrency boom, but the crash and the latest Ethereum consolidation have left them struggling to get rid of unsold equity, while jostling with a deluge of used cards as they prepare to launch a new generation. Panel manufacturers like EVGA say they can’t absorb those shocks the way Nvidia can, and EVGA says they lose hundreds of dollars on every RTX 3080 or RTX 3090 sold.
The board partner also accuses Nvidia of lacking communication regarding MSRP when launching new GPUs. EVGA doesn’t know the final price it will sell the cards for until Nvidia announces suggested prices to the public. The GPU maker also enforces pricing floors and ceilings, limiting EVGA’s ability to price its variants according to how they are allocated to overclocking or cooling systems.
Currently, EVGA calls itself Nvidia’s #1 Certified Partner in graphics card sales in the US and UK, and Nvidia GPUs make up about three-quarters of EVGA’s total revenue. Moreover, the company does not sell AMD or Intel cards and does not intend to further split with Nvidia. Power supplies make up most of the rest of EVGA’s business, but it’s hard to imagine what the company will look like in the next year or two without GeForce products.
The decision to quit GPU work didn’t come suddenly or lately. EVGA says it notified Nvidia in April after trying to renegotiate the partnership several times. Andrew Hahn, CEO and founder of EVGA, said the decision to leave Nvidia was easy, and that working with the company was difficult. Han described the choice as a matter of principle, not money.
Hahn says he has no intention of selling EVGA, fearing investors will change its identity and culture. The company also does not want to lay off anyone, but this seems almost inevitable if it gives up its main source of income.