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GPUs: Will the Current Demand for Graphics Chips Crash Later this Year?

By Dick Weisinger

The global chip shortage has hit the graphics card and GPU market particularly hard. Demand is high, but Nvidia and AMD haven’t been able to keep up with it. The GPU market is expected to grow about 12 percent annually from now through 2025.

Kevin Foley, wrote for PC Invasion that “despite Nvidia and AMD both manufacturing more GPUs than ever, the demand is near limitless. Miners want to mine, gamers want to game, workstation productivity needs need to be met, and even auto manufacturers now want to use GPUs for self-driving vehicles.”

Chip makers are at full production, but some analysts say that there may be a dramatic shift later in the year. With the pandemic winding down, GPU demand may go back to a more normal pace, and that may leave many chip manufacturers suddenly with excess inventory.

Jon Peddie, market analyst, told EETimes that “the risk is that semiconductor suppliers will be lured into overreaction and believe that suddenly hundreds of millions of new users have appeared and the demand will stay high. That’s not only not realistic, it’s also not true—where are they coming from—not this planet? GPU suppliers just haven’t created any new consumers. All the remote offices have been equipped with new PCs, and there is little or no room for new growth.”

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