Ethereum Mining Helps Fuel 30 Percent Surge In Q2 GPU Shipments

MSI Radeon RX 580 and 570 Gaming X

Graphics tracking firm Jon Peddie Research described the discrete graphics market as "outstanding" in the second quarter of 2017, with a nearly 31 percent sequential increase in add-in card shipments, and just a touch shy of a 35 percent bump year-over-year. As always, gaming gave the discrete graphics card market a boost, but so did the increasingly popular cryptocurrency mining sector, which is red hot right now.

In particular, Ethereum has become a major driver of graphics card sales. Ethereum went from trading below $50 per unit at the end of the first quarter to over $355 in mid-June (it is currently valued at $328). Because Ethereum was designed to be mined with graphics card, the rapid rise in the cryptocurrency's value has created a huge demand for discrete GPUs, and both AMD and NVIDIA are reaping the rewards.

JPR Graphics Chart
Source: JPR

As the chart shows, this is the first time in over 9 years that Q2 has seen an increase in shipments, and never one this dramatic. The big difference is the impact cryptocurrency mining (especially Ethereum) is having on the market," JPR said.

The unfortunate side effect is that gamers are getting screwed, both by low inventory and inflated price tags by third-party and second-hand sellers. Not all graphics cards are affected by the mining gold rush, but several popular ones are, such as AMD's second-generation Polaris cards (Radeon RX 500 series).

NVIDIA still holds the market share lead over AMD in the discrete graphics card market with a 70.6 percent chunk of sales, compared to AMD's 29.4 percent, but interestingly AMD was able to narrow the gap from the previous quarter. In the first quarter, NVIDIA served 72.5 percent of the market versus AMD's 27.5 percent share, leaving a 45 percent gulf between the two. That has been reduced to 41.2 percent.

Obviously NVIDIA is still dominating, but what's interesting is that AMD pulled itself a little closer to NVIDIA prior to launching Vega. Now that Vega is here, and with NVIDIA waiting until next year to release Volta cards to consumers, AMD has an opportunity to further narrow the gap.

Thumbnail Image Source: Flickr (BTC Keychain)
Tags:  JPR