Add-in board market increased in Q2’17 from last quarter, and AMD gained market share

Over $3.6 billion dollars of AIBs shipped in the quarter.

The add-in graphics board market was outstanding in Q2'17, increasing 30.9% sequentially, and increased 34.9% year-to-year. explained Jon Peddie, president of the industry’s research consulting firm Jon Peddie Research.

The market shares for the desktop discrete GPU suppliers shifted in the quarter too.

AIBs using discrete GPUs are found in desktop PCs, workstations, servers, rendering and mining farms, and other devices such as scientific instruments. They are sold directly to customers as aftermarket products, or are factory installed by OEMs. In all cases, AIBs represent the higher end of the graphics industry with their discrete chips and private, often large, high-speed memory, as compared to the integrated GPUs in CPUs that share slower system memory.

The GPU and PC market had been showing a return to normal seasonality. That pattern is typically flat to down in Q1, a significant drop in Q2 as OEMs and the channel deplete inventory before the summer months. A restocking with the latest products in Q3 in anticipation of the holiday season, and mild increase to flat change in Q4. All, of that subject to an overall decline in the PC market since the great recession of ’07 and the influx of tablets and smartphones. However, this year, Q2 AIB shipments were completely out of synch, and remarkably high, as shown in the following chart.

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. 

People are sending bitcoins to each other over the bitcoin network all the time, but unless someone keeps a record of all these transactions, no-one would be able to keep track of who had paid what. The bitcoin network deals with this by collecting all of the transactions made during a set period into a list, called a block. It’s the miners’ job to confirm those transactions, and write them into a general ledger. They are paid for this work in like currency.

Ethereum designed to resist the development of Ethereum-mining ASICs.

Ethereum uses a different hashing algorithm to Bitcoin, which makes it incompatible with the special hashing hardware (ASICs) developed for Bitcoin mining. Ethereum’s algorithm is known as Ethash. It’s a memory-hard algorithm; meaning it’s designed to resist the development of Ethereum-mining ASICs. Instead, Ethash is deliberately best-suited to GPU-mining.

The PC add-in board (AIB) market now has just two chip (GPU) suppliers which also build and sell AIBs. The primary suppliers of GPUs are AMD and Nvidia. There are 48 AIB suppliers, the AIB OEM customers of the GPU suppliers, which they call “partners.”

Lots of AIB suppliers, smaller shipments. In addition to privately branded AIBs offered worldwide, about a dozen PC suppliers offer AIBs as part of a system, and/or as an option, and some that offer AIBs as separate aftermarket products. We have been tracking AIB shipments quarterly since 1987—the volume of those boards peaked in 1999, reaching 114 million units, in 2015, 44 million shipped.

Since the introduction of the PC, which was 1981 believe it or not, we estimate that 2.1 billion AIBs will have been shipped by the end of this year. And the inflation adjusted value $1.02 TRILLION dollars!!

The news for the quarter was encouraging and seasonally understandable, quarter-to-quarter, the AIB market increased 30.9% (compared to the desktop PC market, which decreased 18.2%).

AIB shipments during the quarter increased from the last quarter 30.9%, which is which is above the ten-year average of -9.8%. On a year-to-year basis, we found that total AIB shipments during the quarter rose 34.9%, which is greater than desktop PCs, which fell 30.0%.

Ethereum mining is the game changer this quarter. In spite of the overall PC churn, somewhat due to tablets and embedded graphics, the Ethereum mining and PC gaming momentum continues to build and is the bright spot in the AIB market.

The gaming PC (system) market is as vibrant as the stand alone AIB market. All OEMs are investing in Gaming space because demand for Gaming PCs is robust. Intel also validated this on their earnings call., and the recent announcement of a new Enthusiast CPU. However, it won’t show in the overall market numbers, because like gaming GPUs, the gaming PCs are dwarfed by the general-purpose machines.

This edition of Jon Peddie Research’s Add-in Board Quarterly Report covers the market activity of PC-based graphics for Q4'16.

This detailed 97-page report will provide you with all the data, analysis and insight you need to clearly understand where this technology is today and where it's headed.

The report contains the following content:

  • Worldwide AIB Shipment forecast by segment, 2015 to 2021.
  • Attach rate of AIBs from 2001.
  • Detailed worldwide AIB Shipment Volume, by segment, and forecast to 2021.
  • Major suppliers: Detailed market share data-on the shipments of AMD, Nvidia, and others.
  • Market share history from Q1 2004. 
  • Percentage of shipments by region, from 2015 to 2021.
  • Market value of AIBs, and pricing trends
  • A Vision of the future: Building upon a solid foundation of facts, data and sober analysis, this section pulls together all of the report's findings and paints a vivid picture of where the PC graphics market is headed. 
  • Memory load and forecast.

This research finds that global GPU market demand in Q2'16 decreased from last quarter, and decreased from last year, to 83.32 million units. In recent years, as the gaming ecosystem is shaping up, software and hardware developers, information service providers, and even governments have been attempting to unearth market opportunities coming from this new arena. However, global PC shipment volume is forecast to fall further.