Nvidia has announced a potential GPU shortage this quarter, as Chief Financial Officer Colette Kress highlighted concerns about supply constraints during the company’s third-quarter earnings call. The warning follows impressive financial results, which saw the company’s revenue soar to $35 billion, a 94% year-over-year increase. Nvidia’s net income reached $19.3 billion, marking a substantial 109% rise from the previous year.
Gamers brace for tough holiday shopping as Nvidia hints at shortages
The gaming segment contributed $3.2 billion to Nvidia’s total revenue, reflecting a 15% increase compared to the prior year. However, Kress warned that fourth-quarter revenue may decline sequentially due to anticipated supply shortages. This warning signals a major shift in production strategies that could affect both retail and consumer availability of GPUs, especially during the busy holiday shopping season.
Nvidia’s production constraints stem primarily from a strategic realignment towards the upcoming RTX 50 series, “Blackwell,” slated for release in early 2025. Kress stated, “Our gaming supply, given what we saw selling through, was moving quite fast. Now the challenge that we have is, how fast could we get that supply getting ready into the market for this quarter?” Despite concerns, she expressed optimism about resuming production in the new calendar year.
Anticipated supply challenges and their implications
As Nvidia aims to facilitate the launch of the Blackwell GPUs, it seems likely that production of the existing RTX 40 series has slowed or even halted, contributing to market shortages. Reports suggest that Nvidia curtailed RTX 40 series production to accommodate the new product line. This has created a bottleneck, particularly affecting higher-demand models like the RTX 4080 and RTX 4090, which already see limited inventory and price spikes at retailers.
The impending shortage raises important considerations for gamers, who may experience longer wait times and increased prices for sought-after models. Nvidia’s dual focus on catering to gaming and enterprise sectors has proven fruitful, with the data center segment accounting for $30.7 billion, representing approximately 87.7% of total revenue. This concentration on the lucrative data center market comes amid robust demand for AI-driven technologies, which further complicates the supply landscape for consumer GPUs.
The backdrop of anticipated GPU shortages arrives as gamers increasingly seek powerful hardware for high-performance gaming and new AI features. The market’s evolving dynamics suggest that limited inventory may increase prices, especially for premium graphics cards. Although Nvidia has acknowledged the supply-demand imbalance, it remains to be seen whether additional price hikes will materialize or if supply levels can stabilize in the short term.
Details surrounding the timing of the RTX 50 series launch continue to circulate, with Nvidia expected to unveil its flagship models—RTX 5090 and RTX 5080—at CES 2025. Reports indicate that the first Blackwell GPUs will start shipping to add-in board partners (AIBs) this quarter, but specifics around this timeline lack official confirmation. The uncertainty surrounding the RTX 40 series’ future stock and the RTX 50 successors could lead to heightened consumer anticipation and fluctuating market conditions.
Images credit: Nvidia
