However, it is extremely difficult to even get a gpu at msrp, as the street prices today are significantly higher in this video. Well, look into the reasons why the street prices are so high and its not the reason, amd and nvidia want you to believe lets get into it. Nvidias latest earning calls show that they are making record profits at over 6.5 billion dollars in quarter two with just over three billion of that coming from the gaming segment. They contend that of that three billion dollars in the gaming segment. Only 266 million came from the crypto mining processors or the cmp cards they created thats right. They bundle the cmp cards into the gaming segment. In that earnings call jensen made a statement about future availability, and he said he would expect it enables a supply constrained environment for the vast majority of next year is my guess at the moment. So what does supply constrain mean? Is the volume of gpus lower than before? So i did some research and i found a chart over at toms hardware using data from john petty research. They plotted the quarterly volume of discrete gpus that have shipped since 2014.. What you can see is that in quarter four of 2020, when ampere launched, they had over 9 million gpus and thats only gotten better. Since then that is much higher than any quarter since the touring generation. So if supply seems pretty good, then it must be a demand problem throughout that earnings call nvidia kept, stressing demand, demand and more demand, but where is that demand coming from? He mentioned? The increase in gamers is up 20 from last year.
However, the revenue is up. 85 from last year now i understand the average transaction price or atp is increased, but that 20 percent increase in gamers does not explain the 85 percent increase in revenue. There is other demand here that is not represented by gamers. Could that be miners, but nvidia got rid of those with the lhr cards right? One sharp analyst john pitzer asked a rather direct question in that earnings call with regard to the effectiveness of their lhr implementation. Nvidia was very quick to avoid answering that question and jensen quickly, then pivoted to talking again about gamers and demand, so that made me suspicious its not what he said its, what he didnt say since he had depthly avoided answering the question. He was clearly trying to convey his message of demand and gaming to the investment analyst he did not want to address. The concern of the analysts, which was since miners, were the reason for the demand before the implementation of lhr. Are miners still a reason for the high demand after lhr, so i went on a journey, an investigative journey to understand minors and how they view these new lhr cards. I also found an article by john petty research, where they calculated that 25 of the gpus went to minors and speculators, but it only takes into account dedicated miners. They have no way to flush out the casual miner and what is a casual minor, a gamer that casually uses their gpu for mining.
Then i spent many many hours reading blogs, watching videos from youtube channels, dedicated to gpu mining, watching live streams and chats and joining discords to see what the mining community thinks of lhr cards and thats. When it hit me, if you spend any time in the forums, discords or live streams, you will find that the unprecedented demand is coming not from gamers, not from miners, but from the casual miners. These are people who typically are gamers and then discovered the profitability of gpus to do mining so they buy another gpu, then another gpu, and then they are building a rig and another rig. There is example, after example, of people who found the profitability of gpu mining irresistible and quickly expanded to building rigs with six to eight gpus. Each just imagine if these people only purchased one gpu for their gaming machine, then all gamers, who wanted a gpu this generation would have one, including me in retrospect. I could have saved myself quite a bit of time on that journey. If i just remembered, follow the money to understand how a miner thinks of the lhr cards and getting back to the analyst question on the effectiveness of lhr gpus lets go over to nicehash and calculate the daily profits of an lhr versus a non lhr gpu. A 3060 ti non lhr earns about four dollars a day. A 30 60 ti lhr version earns 3.33 cents per day. A 30 80 non lhr earns 6.
25 cents a day, while a 30 80 lhr version earns about 5.16 cents a day and then a 30 90, which is always non. Lhr earns 7.86 cents a day, while a 3080 ti lhr, which is almost a 30 90, earns 5.11 cents a day. So while lhr reduces the profitability, the reality is lhr cards are still very profitable, nice job jensen, the lhr cards, are profitable and miners are willing to pay much higher prices than msrp. As long as the payback periods are reasonable, based on the level of risk, they are willing to take now, i know many of you also want to blame scalpers and bots, but they are not the problem. They are a symptom of the problem. Fundamental problem is that miners are willing to pay higher prices based on the earnings and payback periods involved or, as they like to say, the return on investment miners have an insatiable appetite for more and more gpus makes them more money. Greed is an incredible force in human behavior. Ive wondered why i have not been able to get a gpu for the past year and the answer is simple: miners want it more. They see these gpus as little money makers and they are willing to pay much higher prices to get a gpu for mining. For me, it was just about being able to game at 4k to increase my quality of entertainment that is not as strong a force as greed when you understand the profits involved and the mentality of gpu miners, its really very simple – and it comes down to this – A modern day, gpu is not a graphics processing unit for gamers.
It is a mining processing unit first and can play games second, and when you look at it from that perspective, you can easily understand the existing environment. We are in today why dont, nvidia and amd just make more gpus to satisfy demand. There is a lot more to that answer than just supply constraints, and that could be another video if youre interested. Let me know in the comments below and if you like, this video hit that like button and consider subscribing in the next video. Well look at some trending scenarios and my reason for hope and will also look at intel and their new arc branding of gpus. And will they be the proverbial camel that breaks the straws back to bring gpu prices back down to msrp? Thank you all. So very much for watching stay safe.