Market Overview

BlueFin Research: Graphics Card Market For AMD, Nvidia Continues To Cool In Q2

Share:
BlueFin Research: Graphics Card Market For AMD, Nvidia Continues To Cool In Q2
Related AMD
Benzinga's Bulls & Bears Of The Week: AMD, Disney, Nike, Tesla And More
Bernstein Pumps The Brakes On AMD: 'Expectations Have Soared'
Hype Vs. Hope (Seeking Alpha)
Related NVDA
A Look Back At What's Happened To Each Sector Through The First Half Of 2018 (Part 1)
What The Latest Steam Gaming Data Means For AMD, Nvidia
If You Want To Buy More Apple Or Nvidia Shares, Read This (Investor's Business Daily)

Graphics card prices have been on the decline so far in 2018, but a new report from BlueFin Research Partners suggests the lower prices aren’t driving higher sales numbers.

Graphics card sales have continued to decline through the first nine weeks of the second quarter, based on the latest round of checks with Newegg and Amazon.com, Inc. (NASDAQ: AMZN), BlueFin analyst Paul Peterson said in a note. 

The lack of demand is likely due to a combination of falling cryptocurrency prices and gamers waiting for prices to bottom, the analyst said. 

Peterson outlined his findings and the implications for NVIDIA Corporation (NASDAQ: NVDA) and Advanced Micro Devices, Inc. (NASDAQ: AMD) in a Tuesday report. 

The Number

BlueFin found that Nvidia’s North American graphics card sales are running more than 50 percent lower in the second quarter than in the first, and AMD sales are running at less than 40 percent of Q1 levels so far in Q2. Inventory checks revealed inventory levels are mostly in-line with targets compared to the widespread shortages seen in recent quarters. The Nvidia GTX 1080 Ti was the only processor on the shortage list, according to BlueFin. 

Some AMD partners have slashed prices on the RX Vega and RX 580 cards in an effort to stimulate demand, Peterson said. 

Field experts said the cryptocurrency market is unlikely to stimulate meaningful demand for graphics cards unless the price of Ethereum rebounds to above $800. The price of Ethereum is down 19 percent in 2018 at around $609.

The Bottom Line

The good news for AMD and Nvidia investors is that, while graphics cards prices continue to fall, they still remain above MSRP, Peterson said. 

“While both AMD and NVDA anticipated softer GPU card demand in Q2, we think the current run rates are even weaker than expected, particularly for AMD." 

Softening graphics card demand certainly hasn’t slowed down Nvidia and AMD stock in 2018. Nvidia shares are up another 35.2 percent this year, while AMD stock has soared 46.7 percent.

Related Links:

A Report Card On AMD EPYC Processors From Baird

Stifel Raises AMD Price Target After Cisco Unveils EPYC-Powered Servers

Latest Ratings for AMD

DateFirmActionFromTo
Jun 2018Morgan StanleyMaintainsUnderweightUnderweight
Jun 2018Stifel NicolausMaintainsBuyBuy
May 2018Cowen & Co.Initiates Coverage OnOutperform

View More Analyst Ratings for AMD
View the Latest Analyst Ratings

Posted-In: BlueFin Research Partners Paul PetersonAnalyst Color Cryptocurrency Top Stories Markets Analyst Ratings Best of Benzinga

 

Related Articles (AMZN + AMD)

View Comments and Join the Discussion!