The graphics card market showed growth last quarter, but the long-term outlook is weak

According to a new report from analyst firm Jon Peddie Research, the global market for discrete PC graphics cards from AIB partners showed growth in the fourth quarter of 2024 (Q4 2024). AIB shipments reached 8.4 million units, while desktop processor shipments increased to 22.5 million. Overall GPU shipments grew 6.2%, exceeding the average over the past 10 years.

Image source: NVIDIA

Despite quarterly growth, the outlook for the coming years remains negative. The AIB market is expected to decline at a compound annual growth rate of 4.3% from 2024 to 2028. By the end of the forecast period, the total installed base of graphics cards will reach 119 million units, and the use of discrete graphics accelerators in desktop PCs will be 81%.

Image source: jonpeddie.com

Market share analysis also shows changes in the balance of power between the main players. AMD’s share increased by 5 percentage points compared to the previous quarter, Intel increased its share by 1.2 percentage points, while Nvidia’s share decreased by 6.3 percentage points. It is noted that such dynamics can be associated with a number of factors, including production constraints and the redistribution of resources in favor of graphics processors for artificial intelligence (AI) tasks.

Image source: jonpeddie.com

Strong demand has left manufacturers with a large backlog of orders in the last quarter of 2024, which analysts say will lead to abnormally high deliveries in the first quarter of 2025. However, a slowdown is expected in the second quarter, in part due to the new tariffs. “We are still far from a normal seasonal cycle, and the tariffs will put additional pressure on the market,” said Jon Peddie Research president.

Image source: jonpeddie.com

The overall usage index of discrete graphics cards in desktop PCs fell to 138%, which is 7 p.p. lower than in the previous quarter. The desktop processor market shrank by 7.8% year-on-year, but grew by 11.6% compared to the previous quarter. It is worth saying that since AMD and Nvidia plan to introduce new graphics card models in the first quarter of 2025 (Q1 2025), this may have a positive effect on the market as a whole, further stimulating it.