It is an undeniable fact that computers and the internet have become essential elements of our lives as technologies have advanced. A considerable number of businesses are being remotely managed through electronic devices. The graphics processing unit, GPU, is a fundamental computing engine. Since it is designed specifically for accelerating graphics rendering, it exists on devices that show display output, such as PCs, laptops, tablets, and smartphones. Over the recent decade, the PC industry, especially the GPU industry, has seen a noticeable change.
COVID-19 and the PC Industry.
Over the past three years, the GPU industry has undergone many changes as it has gone through the pandemic. While most business sectors have experienced a decrease in demand due to COVID-19, some industries have benefited from the pandemic, and the PC industry is one of them. According to Gartner, during the first quarter of 2019, before the pandemic, worldwide PC shipments declined by 4.6 percent (Costello, 2019).
However, in 2020, when the pandemic started, it recovered. The PC shipments grew by 4.8 percent for the year. They mentioned that COVID-19 had played a significant role in the rise of PC demand (Costello & Rimol, 2021). Desktops and laptops became essential devices for customers who needed to do their work for school and jobs at home.
Semiconductor Supply Shortage.
Although the PC demand skyrocketed due to the pandemic’s effects on society, the chip supply capacity has decreased due to multiple external factors. In early 2020, car manufacturers significantly decreased their chip orders also due to decreased orders caused by the worldwide pandemic. By contrast, the need for mobile devices and PCs has drastically increased since large numbers of employees and students started to work remotely. Also, the demand for game platforms such as PlayStation and XBOX increased because people wanted to adapt to the time during the lockdown. This caused the transition of automobile semiconductor chip production lines into mobile chips. A considerable amount of chip manufacturing lines had to shut down due to the spread of COVID-19. Also, many factories in China had to shut down since their government enforced a strict anti-coronavirus policy.
GPU Market and COVID-19
Throughout the pandemic, the GPU market also had a drastic change, as it is also a part of the PC industry. Increased demand for mobile and high-end devices due to the COVID-19 pandemic is the main factor that affected the growth of the GPU market, as well as bitcoins and the release of new games.
Before the Pandemic
Since Nvidia released the GeForce 256, the world’s first GPU, in 1999, the GPU market started to rise together with the PC industry. The market size steadily increased with the rise of the gaming industry and the introduction of AI-based machine learning. Looking at the financial report of Nvidia compiled since 2005, the constant growth can be seen until 2019. In 2005, Nvidia had a total of 2 billion USD in revenue. However, in 2018, Nvidia had a total of 11.716 billion USD in revenue. This is an explosive growth. Even after this huge growth, still, the GPU industry was expected to grow after 2019.
During the Pandemic
Boosted by the pandemic, the GPU market has grown a lot. In 2019, Nvidia had a total of 16.675 billion USD in revenue which is 5.757 more compared to 2020 with 10.918.
In 2021, Nvidia made 26.914 billion USD in revenue and 9.752 billion net income. That is more than twice the amount of net income in 2020. Considering that Nvidia’s discrete graphics market share is around 80 percent, it shows how much the graphics market and the industry have grown during the pandemic.
Future of the GPU Industry
The GPU industry is one of the businesses with very bright prospects for the future. As the demand for high-end games is increasing and GPU is essential for future technologies such as AI, virtual reality, and augmented reality, the growth of the GPU industry is natural. According to the Reportlinker GPU trends and forecast report, the GPU market is expected to reach 130.02 billion USD by 2027 (Mordor Intelligence LLP, 2022). Considering that the market value was 23.9 billion USD last year, it is a huge growth projection. On top of that, competition is expected to intensify as Intel has newly participated in the competition between AMD and Nvidia recently.
Upcoming Events
- Nvidia GTC Keynote. (September 20th)
Nvidia released the teaser of GTC keynotes that were held on September 20th. Nvidia CEO Jensen Huang confirmed that he would introduce news with new architecture and AI, graphics, and game-changing technologies. Since GTC keynotes in 2020 September were dedicated exclusively to the new RTX 30 series, people are expecting the new release of the RTX 40 series in this keynote (Nvidia, 2022).
- AMD CPU/GPU Release. (September 27th)
Available from: https://cdn.videocardz.com/1/2022/08/AMD-RX-7000-DEMO-1200×440.jpg
On August 29th, 2022, AMD CEO Lisa Su revealed the brand new AMD 7000 series. During the event, they mentioned the brand new RDNA 3-based GPUs. She claimed the new RDNA 3 would have a 50 percent performance increase per watt (Weatherbed, 2022).
References
- Costello, K. (2019). Gartner Says Worldwide PC Shipments Declined 4.6 Percent in First Quarter of 2019. [online] Gartner. Available at: https://www.gartner.com/en/newsroom/press-releases/2019-04-10-gartner-says-worldwide-pc-shipments-declined-4-6-perc [Accessed 17 September. 2022].
- Costello, K. and Rimol, M. (2021). Gartner Says Worldwide PC Shipments Grew 10.7% in Fourth Quarter of 2020 and 4.8% for the Year. [online] Gartner. Available at: https://www.gartner.com/en/newsroom/press-releases/2021-01-11-gartner-says-worldwide-pc-shipments-grew-10-point-7-percent-in-the-fourth-quarter-of-2020-and-4-point-8-percent-for-the-year [Accessed 17 September. 2022].
- Max, T. (2022). Understanding the Current Global Semiconductor Shortage, Preparing for the Future. [online] IHS Markit. Available at: https://ihsmarkit.com/research-analysis/understanding-the-current-global-semiconductor-shortage.html [Accessed 17 September. 2022].
- Mordor Intelligence LLP (2022). Graphics Processing Unit (GPU) Market – Growth, Trends, COVID-19 Impact, and Forecasts (2022 – 2027). [online] www.reportlinker.com. Available at: https://www.reportlinker.com/p06283201/Graphics-Processing-Unit-GPU-Market-Growth-Trends-COVID-19-Impact-and-Forecasts.html?utm_source=GNW [Accessed 19 September. 2022].
- Nvidia (2022). GTC 2022: #1 AI Conference. [online] NVIDIA. Available at: https://www.nvidia.com/gtc/session-catalog/?tab.catalogallsessionstab=16566177511100015Kus#/session/1657326563846001zRzJ [Accessed 19 September. 2022].
- Weatherbed, J. (2022). AMD teases RDNA 3 GPUs as it sets a release date for Ryzen 7000 CPUs. [online] The Verge. Available at: https://www.theverge.com/2022/8/30/23328478/amd-rdna-3-gpu-ryzen-7000-cpu-announcement-livestream [Accessed 19 Sep. 2022].
