Founder's edition like its name suggests, is a limited run/stock version of the gpu. Once it runs out, buyers have to turn to the usual AIB or find someone who is willing to resell their founder.
just that since pascal, fe cards have been available for the whole lifetime of the card. so aibs now have to treat nv as a competitor also, one with an unfair advantage at that.
Even if margins are low, 80% of gross revenue is nothing to sneeze at. If their high margin products were selling very well, they would have already made up the 80% instead of gpus. I would rather sell a 2% margin and get 1 billion than sell only 80% ones and get only 100 million.
its been stated that their psu sales bring in 3x more profit than their gpus. revenue is nothing if the costs outweigh it, and according to gn, evga has been making hundreds of dollars of losses per card on high end ampere (which are supposed to be high margin products), 3080 and up.
just that since pascal, fe cards have been available for the whole lifetime of the card. so aibs now have to treat nv as a competitor also, one with an unfair advantage at that.
its been stated that their psu sales bring in 3x more profit than their gpus. revenue is nothing if the costs outweigh it, and according to gn, evga has been making hundreds of dollars of losses per card on high end ampere (which are supposed to be high margin products), 3080 and up.
FE stocks are very limited compared to AIB, so much so that there is a perpetual waiting list. In the US, it's hard enough to get one, let alone outside of it. Never mind the technical differences/performance between founder and AIB. That's to say, even if founder is a competitor, it's a very minor one, not to the scale that evga is making it out to be. They make it sound like other AIBs are not their biggest competitor.
Higher margin doesn't necessarily translate into higher absolute profit. For example, 5% margin of 1k is 50, 10% margin of 100 is 10. Would it make financial sense to give up the 1k product just because it has a lower % of margin? Unless they give actual figures, there's no context to it. As for the claim of losses, I find that hard to believe because if Nvidia were forcing them to do so then all other AIBs would be affected as well but I we don't see them in any hurry to close shop just because of it. As I have also pointed out, ASUS is able to charge a high premium for their gpus, especially the high end ones, and still sell them. Heck, asus is the most expensive out of them all. Why is asus able to do that but not evga? Even if that were the case, why the need to close down the entire gpu division? Why not just manufacture the low to mid tier cards only?
GN pointed(time stamp 08:19) out that evga also said "it's not a financial decision" which is why I don't believe the aforementioned are the "real" reasons for it. It is also contradictory - only "financial" reasons are given but yet they say it isn't a fiancial one. There are probably deeper ones but too sensitive or personal to be mentioned so they gave the superficial ones instead.
Higher margin doesn't necessarily translate into higher absolute profit. For example, 5% margin of 1k is 50, 10% margin of 100 is 10. Would it make financial sense to give up the 1k product just because it has a lower % of margin?
im sure that when they talked abt psu vs gpu profits, they were referring to absolute values rather than % margins. wouldnt make sense otherwise. this would also mean that the % margins on psus are far higher than gpus, so its ur example but tombalek.
lets simplify a lil and assume evga has 1mil in revenue, 80% gpu and 20% psu.
this means that gpus brought in 800k, psu 200k. lets suppose cost of making these products are 790k and 160k respectively, meaning that profit margin for gpu is 10k, with psu profit being 3x higher (40k). % margin for gpu is hence not even 1.5% for gpu while it is 25% for psu.
with such slim % margins and prices of cards likely to fall further with used mining cards flooding the market soon, i dont think its unreasonable to drop such a risky division with barely any returns.
As for the claim of losses, I find that hard to believe because if Nvidia were forcing them to do so then all other AIBs would be affected as well but I we don't see them in any hurry to close shop just because of it.
the bigger ones have much more flourishing divisions, like motherboards and gaming laptops, not to mention some also take in gpus made by amd with none of nv's shenanigans.
As I have also pointed out, ASUS is able to charge a high premium for their gpus, especially the high end ones, and still sell them. Heck, asus is the most expensive out of them all. Why is asus able to do that but not evga?
all abt brand image. asus made it to the pt where their higher prices meant better quality, but evga did not. raising prices on existing products are also a quick way to dry up sales in the face of weakening demand.
anyway, at the end of the day this decision was finalised months ago, so no amt of pleading is going to make them change their minds, not at least with the current ceo.
im sure that when they talked abt psu vs gpu profits, they were referring to absolute values rather than % margins. wouldnt make sense otherwise. this would also mean that the % margins on psus are far higher than gpus, so its ur example but tombalek.
lets simplify a lil and assume evga has 1mil in revenue, 80% gpu and 20% psu.
this means that gpus brought in 800k, psu 200k. lets suppose cost of making these products are 790k and 160k respectively, meaning that profit margin for gpu is 10k, with psu profit being 3x higher (40k). % margin for gpu is hence not even 1.5% for gpu while it is 25% for psu.
with such slim % margins and prices of cards likely to fall further with used mining cards flooding the market soon, i dont think its unreasonable to drop such a risky division with barely any returns.
the bigger ones have much more flourishing divisions, like motherboards and gaming laptops, not to mention some also take in gpus made by amd with none of nv's shenanigans.
all abt brand image. asus made it to the pt where their higher prices meant better quality, but evga did not. raising prices on existing products are also a quick way to dry up sales in the face of weakening demand.
anyway, at the end of the day this decision was finalised months ago, so no amt of pleading is going to make them change their minds, not at least with the current ceo.
They only said lower margins, they didn't say whether it is absolute figure. Until they give actual figures, there's no context to it. It could reasonably mean either. Given that gpu makes up 80% of their revenue, I'm more inclined to believe that the majority of their profit also comes from gpu even if it isn't the same %.
EVGA makes a lot of stuff other than gpu as well. They make amd mobos too. As for the point about other companies making amd gpus as well, then it would beg the question, why is evga not switching to amd or intel then? Why completely drop from the GPU business?
GN pointed out that nvidia imposes price floors and caps for gpus. ASUS is not exempted from it but they they don't seem to have the same issue as evga. I believe many would disagree about ASUS being higher quality, there are a lot of argument about it being overpriced due to just the branding itself. GN also mentioned that evga supposedly wanted to go for higher end AIB and cooling solutions for their GPUs but nvidia's price caps made it hard for them to do so. If ASUS is indeed putting out better quality for their high end, then it's weird that they are not that bothered about the price cap but evga is.
Perhaps the biggest contradiction coming from evga is that they claim(@ 08:19) that it ISN'T A FINANCIAL DECISION yet they only state financial ones. What gives?
To top it off, even GN is SKEPTICAL of evga's reasons and they believe that the real reason is because they ordered too many during the crypto boom.
well gainward is no longer in SG market for sure since that annoucement back then when it sold to palit. galax to me was a surprise of it been palit sub brand.
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