Why did EVGA stop making GPUS ?

In 2022, EVGA, a well-known brand in the world of computer hardware, made a shocking announcement: it would no longer be making graphics cards (GPUs). This news left many people wondering why did EVGA stop making GPUs after years of success in the market. In this article, we will break down the reasons behind this decision in an easy-to-understand way, while exploring the changes in the industry that led to this move.

A Quick Look at EVGA’s History in the GPU Market

EVGA was founded in 1999 and quickly became a popular brand in the PC hardware world. Known for making high-quality GPUs, EVGA was a trusted partner of NVIDIA, one of the biggest names in the graphics card market. Their GPUs, often praised for great performance and reliability, were loved by gamers and computer builders alike.

EVGA was best known for its custom versions of NVIDIA’s graphics cards, such as the GeForce GTX and RTX series. These cards were known for offering extra features, like better cooling and higher performance, making them a go-to choice for enthusiasts. However, despite all the success, EVGA stopped making GPUs in 2022, which raised many questions. Let’s take a closer look at why this happened.

The EVGA-NVIDIA Partnership

For many years, EVGA worked closely with NVIDIA, using NVIDIA’s GPU technology to create custom graphics cards. This partnership helped EVGA become a leader in the market, offering high-performance graphics cards with added features. However, there were some issues with this arrangement.

NVIDIA’s Shift Toward Direct Sales

One of the main reasons why EVGA stopped making GPUs is the change in how NVIDIA sells its products. In recent years, NVIDIA has started selling graphics cards directly to customers through its own website and other channels. This cut into the profits of third-party manufacturers like EVGA, who could no longer rely on selling NVIDIA cards through traditional retail channels. EVGA felt that NVIDIA’s direct sales model was reducing their ability to make a good profit.

Lack of Control Over Pricing

Another problem EVGA faced was the pricing control. NVIDIA set the prices for its GPUs, which left EVGA with little room to adjust prices. With demand for GPUs being so high, especially during the global chip shortage, EVGA found it harder to compete with other companies. The inability to set its own prices made it difficult for EVGA to offer products that were both affordable and profitable.

Global Chip Shortage and Increased Competition

In addition to the issues with NVIDIA, the global chip shortage that began in 2020 played a big role in EVGA’s decision to leave the GPU market. The shortage made it harder for all manufacturers, including EVGA, to get enough chips to make graphics cards. As a result, the price of GPUs skyrocketed, and availability became limited. This led to frustrated customers who had trouble getting the cards they wanted.

At the same time, AMD (Advanced Micro Devices), a competitor to NVIDIA, had started gaining market share with its own line of graphics cards. AMD’s Radeon GPUs offered a good alternative for gamers, and this increased competition made it harder for EVGA to maintain its leadership in the market.

Financial Pressure and Profit Margins

The combination of rising costs, competition, and a reliance on NVIDIA’s pricing left EVGA with narrow profit margins. As the GPU market became more competitive, EVGA found it increasingly difficult to make a profit. Despite the high demand for GPUs during the pandemic, the financial pressures from manufacturing and supply chain issues took a toll on the company.

The lack of control over pricing, combined with high manufacturing costs, made it difficult for EVGA to continue making GPUs at a reasonable profit. EVGA also faced rising costs in components, like memory and chips, due to the global supply chain disruptions. These factors ultimately made the GPU market less attractive for the company.

EVGA’s New Focus: Moving Away from GPUs

After announcing that it would no longer make graphics cards, EVGA shifted its focus to other areas of the PC hardware market. The company continues to make motherboards, power supplies, and accessories, such as gaming peripherals and cooling solutions. By focusing on these product categories, EVGA can still serve gamers and PC builders while avoiding the intense competition in the GPU market.

This shift is also financially smart. Motherboards and power supplies have higher profit margins than graphics cards, which means EVGA can still make money without dealing with the challenges of the GPU market. Plus, these products are less affected by the same supply chain issues that hurt the graphics card industry.

The Impact on the GPU Market

The decision of why EVGA stopped making GPUs is significant because EVGA was one of the most popular third-party manufacturers for NVIDIA-based graphics cards. With EVGA’s exit from the market, other companies like ASUS, MSI, and Gigabyte will likely fill the gap. These companies will continue to produce NVIDIA graphics cards, but without EVGA’s strong presence, it will be interesting to see how the market evolves.

EVGA’s exit also signals a shift in the industry as a whole. The increased direct sales by NVIDIA, combined with competition from AMD, has changed the way companies approach the GPU market. It may lead to more changes in the future, as manufacturers adapt to new market conditions.

What’s Next for EVGA?

EVGA’s decision to stop making GPUs doesn’t mean the company is going away. The company is still committed to making high-quality products for PC enthusiasts, but it is now focusing on other areas. EVGA will continue to offer gaming accessories, power supplies, and motherboards, which will allow it to remain a strong player in the gaming and PC hardware space.

The company’s shift away from GPUs is a strategic move, allowing EVGA to stay competitive in a market that has become increasingly difficult for third-party manufacturers. By moving into more profitable areas and avoiding the pressures of the GPU market, EVGA is positioning itself for long-term success.

Why did EVGA stop making GPUS?

The decision of why EVGA stopped making GPUs is the result of several factors, including changes in the relationship with NVIDIA, financial pressures, increased competition from AMD, and global supply chain challenges. EVGA’s exit from the GPU market is a big change, but it’s not the end of the company. By focusing on other areas of the PC hardware market, EVGA can still continue to serve gamers and PC enthusiasts while adapting to the changing landscape.

As the GPU market continues to evolve, EVGA’s decision shows just how challenging it can be to stay competitive in a rapidly changing industry. While EVGA’s GPUs will be missed, the company’s future in the broader PC hardware market looks promising.

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