Bombshell: EVGA Severs Ties With NVIDIA And Exits The GPU Market
Friday, September 16, 2022, 04:41 PM EDT
In an absolutely gobsmacking bit of news, both Gamers Nexus and JayzTwoCents scored an exclusive press conference with EVGA (along with Jon Peddie Research) where the company's CEO, Andrew Han, announced that EVGA would be severing its ties with NVIDIA and completely exiting the GPU market. This comes along with allegations toward NVIDIA of "disrespectful" behavior from EVGA's CEO.
The aforementioned YouTube channels broke the news, but EVGA itself hasn't remained silent on the topic. While there's no press release, the company made a post to its popular user forums explaining that EVGA will not carry the next-generation graphics cards, that it will continue to support the existing products, and that it will continue to provide the current-generation products.
This is a real shocker for the industry. EVGA has long been seen as NVIDIA's most stalwart partner, as the American company's graphics cards are exclusively based on Team Green's GPUs. EVGA was one of the very first board partners that NVIDIA ever had, and the vendor's mindshare is such that its cards will be the first that many hardware enthusiasts think of when imagining NVIDIA GPUs.
The reasoning behind the split is disjointed and a little confusing. EVGA says that it elected to part ways with NVIDIA primarily due to "disrespectful" treatment from the GPU manufacturer. The company cites NVIDIA behaviors like withholding critical information from its partners, such as the GPU MSRP, until such details are announced publicly. Not knowing the price of your own upcoming product certainly makes revenue predictions more difficult.
EVGA further says that NVIDIA has "screwed it over" with the GeForce 30 series. The company claims that it is suffering significant losses in the market due to NVIDIA building its own boards and selling its own GPUs. Doing so allows it to price the cards lower than AIBs can, as the partners have additional costs to deal with beyond the price of buying the GPUs from NVIDIA.
A final point that Andrew Han mentioned was that NVIDIA allegedly made extreme demands of EVGA's staff. He didn't go into detail but mentioned that one reason for making this decision was to reduce the amount of pressure on his people. Certainly, dropping the market that provides 80% of your company's revenue will reduce the amount of pressure on your staff, but we tend to agree with both YouTubers in saying that it seems a bit of an extreme measure.
To that point, EVGA says that it will not be doing layoffs and that it will continue to "take care of" its employees, although it also acknowledges that there will likely be some attrition. The company apparently intends to reallocate its staff to other businesses, although as Gamers Nexus noted, there is likely not enough work to go around for all of the employees that must be reallocated. There are also employees whose job is likely so specialized on EVGA's GPU products that they simply will not be able to be "reallocated."
The journalists pressed on the point of whether EVGA might not move to producing Intel or AMD GPUs. The company says it has no interest in such a partnership at this time due to an unwillingness to "betray" NVIDIA despite seemingly accusing NVIDIA of doing the same to EVGA. Andrew Han had also some curious statements to make on the topic, including the below quote in response to Gamers Nexus pointing out that Intel could use a board partner with the experience and expertise of EVGA:
Perhaps most concerning is that EVGA says it will not expand into new product categories. That means that the company intends to expand its current businesses besides graphics cards, which are primarily power supplies. Whether that means that EVGA will become a first-party power supply manufacturer itself is up in the air.
The future the company in the short term isn't up in the air, at least. Andrew Han confirmed to the outlets that he has no interest in selling the company and no desire to retire, despite being in his 60s. He expressed displeasure at the idea that EVGA could be bought up by people who would tarnish the good name of the company. Apparently, EVGA has extremely low operating costs and says that this is a "calculated decision" made in the name of principles, not revenues.
Whatever happens, we're disappointed to see one of the most beloved graphics card vendors exit the market. While no company is flawless, EVGA has been mostly rock-solid with regards to both its products and its customer service for decades. We're not sure that a messy public breakup was the best way for EVGA to proceed, but in any event, it seems like the AIB's loyal fans will have to start looking elsewhere.