GeForce GPUs are 80% of EVGA’s revenue—but it’s cutting ties with Nvidia anyway

Some of the more attractively priced options on the market include some of the graphics cards manufactured by eVGA. According to analyst Jon Peddie and an EVGA forum post, EVGA will no longer make cards based on the company's Turing graphics cards.

According to the gaming website, 80 percent of EVGA's revenue comes from the sale of GeForce graphics cards, which is a momentous and potentially company-ending change. Andrew Han, the CEO of EVGA, said that the decision was about principle and not financials.

The pricing strategy was a sore point. The pricing of cards offered by EVGA and other vendors could often be undercut by first-party cards from Nvidia, forcing them to either reduce prices or lose sales.

The broader dynamics of the market are difficult to navigate. As Peddie points out, even as the cost of graphics cards has gone up, the profit margins for the board partners that make them have gone down. Modern high-end graphics cards are more expensive to design and manufacture due to their higher power, cooling, and signaling requirements than they were a few years ago.

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It probably also doesn't help that the GPU market has been plummeting back to earth this year, after over a year of limited stock and inflated pricing. Sliding cryptocurrency values and the Ethereum cryptocurrency's move away from GPU mining have both flooded the market with secondhand GPUs, which has in turn affected demand for new GPUs. In Nvidia's last earnings call, CEO Jensen Huang complained of "excess inventory" of RTX 3000-series GPUs that made it miss its quarterly revenue projections by $1.4 billion.

It can be summed up as "so long and good luck."

"We've had a great partnership with EVGA over the years and will continue to support them on our current generation of products," a spokesman for the graphics card maker said. We wish Andrew and his friends good luck.

According to Peddie, the end of the EVGA-Nvidia relationship could hurt the company, but in the long run it is unlikely to be a problem. Even though there are differences in cooler design and clock speeds, the same series of graphics cards tend to perform the same regardless of which partner makes them. If EVGA's products aren't available, people will just go to another company and buy an RTX 3070.

According to Han, the company doesn't plan to return to the market for graphics cards with future generations of its products. Han said that EVGA would stop selling cards based on older graphics cards at the end of the year. The company will have enough inventory of these cards to fulfill any warranty repairs or replacements.

Kyle made a contribution to this report.