EVGA Ends Decades-Long Partnership With NVIDIA and Quits the GPU Business
Update: NVIDIA has seemingly responded to this news with a very high-brow statement wishing EVGA the best for their future:
Can't reach EVGA as their staff is in a meeting, but here's a classy statement from Nvidia: "We’ve had a great partnership with EVGA over the years and will continue to support them on our current generation of products. We wish Andrew and our friends at EVGA all the best."
— tae kim (@firstadopter) September 16, 2022
EVGA has announced that its formally ending its partnership with NVIDIA and will end all GPU operations entirely, quitting the business for good. According to a recent video published by Gamers Nexus, their team went for a closed-door meeting with the CEO Andrew Han and broke it all down, here is what he had to say:
We are not going to be on [NVIDIA CEO] Jensen’s lap on stage, so I don’t want people to speculate what’s going on [when we are not there]. EVGA has decided not to carry the next-gen. EVGA is continuing the current product line. We will continue the current gen [until we run out].
Upon further discussion with the Gamers Nexus team, Andrew stated the difficulties his company encountered working for NVIDIA and how their management itself had “bound” EVGA into making this decision. When asked whether the decision was difficult for the company, Andrew replied, “This is easy. Working with NVIDIA was hard“.
Speaking on the future of the company and whether it will return for the RTX 5000 series, Andrew stated, “No. Completely stop”. EVGA will stop making GPUs entirely now. However, he did state that the existing customers will continue to get RMA and technical support and that the company has withheld some GPU boards for RMAs and warranties.
EVGA is expected to run out of RTX 3000 stock by the end of 2022. The following message was posted to the EVGA forums by product manager Jacob Freeman regarding the current state of their existing GPUs:
As for why this all went down the way it did, the decision to leave NVIDIA was not economic or concerned with monetary reasons. In fact, the CEO stated that EVGA is still “financially sound and running“. That suggests a deeper, perhaps more personal logic lies behind.
According to Gamers Nexus, NVIDIA’s upper-level management was already informed about the decision in April 2022. But most NVIDIA and EVGA employees would be finding this out with the release of Gamers Nexus’ video.
Andrew also said they would try their best to reallocate their employees to another company division. Still, judging by the fact that the company currently has 280 employees, it will be difficult for them to cater for everyone and there definitely will be some attrition. The CEO was adamant about no layoffs, but it is hard to see how that could happen when multiple people would have nothing to do at the company.
Further clarifying the company’s future, the CEO stated they have no plans for any Intel or AMD partnership. This is high time for Intel to come in and offer EVGA the right amount and, more importantly I guess, provide them with the respect they deserve to scoop up a major AIB for Arc. However, Andrew himself was clear about how Intel’s product is not good enough yet. As for why he turned down AMD, that’s anyone’s best guess at this point.
What Went Wrong Between NVIDIA and EVGA?
Upon being asked the reason for this decision, EVGA stated that a lack of communication and cooperation between both companies led to this moment. The CEO further clarified that NVIDIA doesn’t communicate with them properly. The Green Team keeps such a tight lip that even the MSRP for their upcoming GPUs are not specified to the literal AIBs who’re producing them until it is publicly revealed on the stage.
This has resulted in financial concerns for the company, unaware of how to price its product before releasing it. Things have gotten so bad to the point that EVGA is almost always left with extra stock at the end of the generation’s life cycle with huge losses faced towards the start. This additional inventory is then sold off at even further losses resulting in six-figure debts for the company.
This cycle apparently has repeated itself at least twice now with Turing and now Ampere. EVGA has stated that they have no debts, major trade payables and even own all their buildings, on top of championing their sound financial position. However, NVIDIA has always tried to make sure with their greedy tactics that issues keep arising.
Case in point, the CEO stated that NVIDIA is continuously undercutting EVGA’s ability to sell its products with NVIDIA’s parts since the company is selling its Founders Edition cards at a lower price, causing consumers to opt for that, resulting in a lack of sales. Andrew further commented that such issues are brought up with NVIDIA multiple times but they are unserious about it every time and lack an adequate response.
Aside from that all that, a bit of personal flair is also a constituent here. While Andrew denied claims of retirement, he did attribute to wanting more time to spend with his family. He has no intentions of selling the company either as he believes no owner would be able to carry on the legacy he created.
With the next-gen RTX 4000 series right around the corner, the ending of EVGA’s partnership is a big blow to NVIDIA. Not only are their relations with vendors coming out to the public, but distrust concerns will raise multiple questions on their working methods. NVIDIA already doesn’t have the best PR image, and this will certainly add to the list of stains on their corporate suits.
With all this happening amidst a historic mining crash that sees the GPU market in a slump, the situation does beg the question: would EVGA have done this if we were in a mining boom? If profits were still high and the demand ridiculously high, would EVGA continue producing GPUs even with a disrespectful NVIDIA? Putting up with their lack of gratitude in return for unprecedented revenue? Something to think about…