Nvidia’s GPU performance
In the previous part of this series, we saw that Nvidia (NVDA) reported strong revenue and margins in fiscal 3Q17,[1. quarter ended October 30, 2016] driven by the success of its Pascal GPU (graphics processing unit). The company earns revenue from two products:
- GPUs: used in PC gaming, data center, automotive, and workstations
- Tegra processors: used in game consoles, automotive, and tablets
The GPU is Nvidia’s core product, accounting for 85% of its revenue. In fiscal 3Q17, GPU revenue rose 53% YoY (year-over-year) to $1.7 billion, driven by strong demand for Pascal GPUs in its Gaming and Data Center segments.
Nvidia’s position in the overall GPU market
According to data from Jon Peddie Research, overall GPU shipments rose 20.4% quarter-over-quarter in 3Q16, with Nvidia reporting 39% growth, followed by AMD at 20% growth and Intel at 18% growth.
Nvidia’s GPU market share increased 2.2% to 16.1% in 3Q16 as compared with 2Q16. However, AMD’s market share fell 0.6% to 13%, and Intel’s market share fell 1.6% to 70.9% during the quarter.
Discrete GPU market
Jon Peddie Research’s data showed that discrete GPU shipments rose 35.6% quarter-over-quarter in 3Q16. The growth was mainly driven by an increase in demand for gaming desktops and notebooks. Plus, 69% of gaming GPUs sold were for PCs and only 31% were for consoles. Discrete GPUs are used in gaming desktops and notebooks, and Intel does not make such GPUs.
On a sequential basis, Nvidia’s desktop discrete GPU shipments rose 39.8%, and notebook discrete GPU shipments rose 38.7% in 3Q16, according to Jon Peddie Research. Both desktop and notebook GPUs reported similar growth as the Pascal notebook GPU performance was on par with that of its Pascal desktop GPU performance.
However, this was not the case with AMD, as the launch of its AM4 chips was delayed. Hence, its desktop discrete GPU shipments rose 34.7% sequentially, whereas notebook discrete GPU shipments rose 23% sequentially in 3Q16.
GPUs in data center and automotive uses
It’s important to note that the above research data only includes GPUs used in PCs, notebooks, and tablets, This research excludes Nvidia’s GPUs used in data center and automotive uses, as these are new applications for the GPU that were developed by the company.
AMD is also expanding its GPU applications in the data center space. It recently partnered with Google (GOOG) to supply GPUs for the latter’s cloud platform.
Next, we’ll look at Nvidia’s Tegra processor business.