ASRock says graphics card prices are falling amid lower demand from Chinese cryptominers
With the constant barrage of bad news about how long the chip shortage is predicted to last, here’s something that should put a smile on gamers’ faces. ASRock believes graphics card prices are falling as a result of China’s crackdown on cryptomining. Additionally, shipments of AMD GPUs are expected to improve as substrate production capacity increases.
It was back in May when a Chinese State Council committee led by Vice Premier Liu He announced the crackdown on virtual currencies as part of efforts to curb financial risks. It was the first time China’s cabinet targeted mining, a massive business in a country that accounts for up to 70% of the world’s crypto supply.
Clamping down on Chinese cryptomining is having an effect on demand for graphics cards in the country. To give you an idea of how much impact the practice has on the market, 700,000 graphics cards that shipped globally in the first quarter ended up in the hands of miners. That equates to around 25% of all graphics cards shipped between January and March.
DigiTimes reports that ASRock is confident about its sales and profits in Q2 thanks to strong demand for graphics cards, industrial PCs, and servers. It expects sales to grow sequentially in the third quarter despite the global chip shortage.
We’ve long known that miners are exacerbating graphics cards’ availability problems. But with China’s crackdown and BTC’s price still below $40,000—partly because of Elon Musk—demand in the country is cooling. There’s also the prospect of miners selling their cards on the second-hand market, thereby improving supply.
Another section of the report that gives cause for optimism is ASRock’s prediction that AMD GPU shipments will improve in the second half of the year due to capacity adjustments and increasing supply of substrates. Team red boss Lisa Su recently said she believes its CPU shipments will improve later in 2021, could the same be true of its GPUs?
Like many tech companies, unprecedented demand has boosted ASRock’s bottom line. Its net profit came in at a record $17.88 million in Q1, up 167% YoY. Graphics cards will account for 20% of ASRock’s second-quarter revenues while motherboards grab 50%. However, its mobo shipments are suffering due to shortages of Intel and AMD CPUs, a problem it says will not improve until the fourth quarter.