EVGA Cuts Ties with Nvidia

EVGA, often considered Nvidia’s top add-in-board partner, is making a drastic shift. It’s done doing business with Nvidia and will stop making GPUs altogether.

According to YouTube channels JayZTwoCents and GamersNexus, which both sat down with EVGA CEO Andrew Han to discuss his frustrations with Nvidia as a partner and reasoning for making the decision. Jon Peddie Research also published a brief article on the matter (article).

“We are not going to be on [Nvidia CEO] Jensen [Huang]’s lap on stage, so I don’t want people to speculate what’s going on [when we’re not there],” GamersNexus Steve Burke quotes Han as saying. “EVGA has decided not to carry the next gen.”

EVGA product management director Jacob Freeman mentioned in its forums (forums), where the company offered the following message: “EVGA is committed to our customers and will continue to offer sales and support on the current lineup. Also, EVGA would like to say thank you to our great community for the many years of support and enthusiasm for EVGA graphics cards.” EVGA also confirmed that it will not carry the next generation of GPUs, that it will support current generation products, and that it will “continue to provide the current generation products,” But though it didn’t specify for how long!?

It is notable that Han met with two of the biggest tech YouTuber channels and had the videos embargoed, so there may be more to the story.

GamersNexus

“We’ve had a great partnership with EVGA over the years and will continue to support them on our current generation of products,” Bryan Del Rizzo, director of global public relations for GeForce at Nvidia told Tom’s Hardware. “We wish Andrew and our friends at EVGA all the best.”

EVGA will reportedly continue the existing RTX 30-series product line until it runs out of stock.  The company won’t be moving to partner with AMD or Intel, either, with plans to instead focus on other products for the foreseeable future (EVGA already makes power supplies, coolers and motherboards, for instance), but also reportedly won’t expand into new product categories.

The company has reportedly withheld some stock for the market for the purposes of replacing cards in warranty, which should protect current customers, at least for a while.

JayZTwoCents

Han told JayZTwoCents and GamersNexus that EVGA won’t be selling the business. GamersNexus states that Nvidia’s top brass were first notified in April, while Peddie reports that Nvidia was informed in June.

Apparently, EVGA did make some RTX 40-series cards that made it as far as the engineering sample stage. However, it’s unclear how EVGA will keep its employees together. It’s not a huge company, and while the GamersNexus video suggests Han said he wants to take care of employees, it’s unclear what some of these engineers will have to do.

The company laid off some employees in Taiwan earlier in the summer. Both videos suggest that EVGA feels that Nvidia has stifled it, and suggest they don’t find out details like MSRP, costs to buy GPU chips and more until Nvidia announces them, often publicly on stage. 

There is also talk of price ceilings as well as not being able to customize cards by changing the specs, like adding more memory.  It’s also an issue because Nvidia is competing against partners with its own Founders Edition cards, because Nvidia, as the supplier and manufacturer, doesn’t have to worry about profit margins as much.

EVGA has built its reputation on delivering some of the best Nvidia GPU AIB cards. In fact, the VGA stands for video graphics adapter, which is odd for a company that no longer makes them.

According to Jon Peddie Research, EVGA’s shift here will “put a big hole in Nvidia’s North American sales of AIBs,” suggesting that EVGA had 40% of the market, as well as fans of the brand in western Europe.

Peddie notes that as GPUs require more and more electricity, EVGA may be able to sell individuals and OEMs power supplies to make up for some of the profits.

Does it mean EVGA is going out of business?

Although 78% of EVGA’s revenue is derived from its graphics business, the company says it will continue to operate its other ventures.

The company’s next largest venture is power supplies, and while it only makes up 20% of EVGA’s revenue, it has four times the gross margin of its graphics business.

Losing the vast majority of its revenue is still problematic, however, though EVGA explicitly denied that there would be any layoffs. Han also denied he would sell EVGA. The company is apparently in a healthy financial position.

Furthermore, the CEO didn’t want to deprecate EVGA’s reputation by selling it to another company that might only be interested in profit. While EVGA could potentially partner up with AMD or Intel to preserve its AIB GPU business, the company has make it clear that it will not be making any GPUs in the future.

The tech YouTubers speculate that EVGA’s CEO might have personal reasons for not wanting to pursue a partnership with Nvidia’s competitors, similar to his personal reasons for terminating the partnership with Nvidia.

As for existing EVGA GPUs, the company confirmed it would honor warranties and RMAs as long as supplies last. Its supply of RTX 30-series cards will run out by the end of the year, however, and it’s not certain how easy it will then be for EVGA to uphold its warranties, whether or not the company is willing.

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