Nvidia, the undisputed leader in the graphics card market, has been expanding its product lineup, including the dominating RTX 40-series. Recently, they introduced the budget-friendly RTX 4070 model. However, many users still face challenges in finding these cards. Those looking to buy a new card often struggle to find stock or are forced to pay sky-high prices for the scarce 40-series models. It seems that this situation might be intentional, as reports suggest that Nvidia is holding off on increasing the production of the RTX 40-series. Here are the details….

Nvidia Reportedly Holding Off on Boosting RTX 40-Series Production: Is It A Strategic Move?

According to a recent report by DigiTimes, Nvidia may be taking a strategic approach with its latest GeForce RTX 40-series GPUs based on the Ada Lovelace architecture. The company’s backend service providers, Siliconware Precision Industries (SPIL) and King Yuan Electronics (KYEC), have reportedly not seen increased orders for testing and packaging of the new GPUs. This suggests that Nvidia is waiting for its partners to sell off remaining GeForce RTX 30-series inventory before supplying them with the latest generation graphics chips.

Despite having introduced an extensive range of Ada Lovelace GPUs for client applications, including the AD102, AD103, AD104, AD106, and AD107, Nvidia has not signaled to its OSAT providers to scale up production for the GeForce RTX 40-series. The company had previously pre-paid TSMC for silicon manufacturing services during 2021-2022, and likely has N4-based Ada Lovelace wafers in stock. However, it still needs to book OSAT capacity before ramping up orders to increase supply.

Usually, Nvidia’s sales of GPUs to its partners trend upward in the third quarter, which should lead to the company booking OSAT services at this time. However, if the DigiTimes report is accurate, it seems that Nvidia is holding off on increasing testing and packaging of its Ada Lovelace silicon. Nvidia’s partners have already started shipping GeForce RTX 4070, RTX 4070 Ti, RTX 4080, and RTX 4090 graphics cards for desktops. Despite being among the top graphics cards available, demand for these products is reportedly not as high as Nvidia would like.

The market has also seen a variety of laptops equipped with GeForce RTX 4050, RTX 4060, RTX 4070, RTX 4080, and RTX 4090 Laptop GPUs. With Ada Lovelace graphics processors already covering almost all market segments, the anticipated popularity of solutions like the GeForce RTX 4070 and the expected RTX 4060 suggests that Nvidia will need to increase GPU volume and packaging services.

Nvidia and its partners may already have enough RTX 30- and 40-series GPUs in stock, negating the need to ramp up testing and assembly ahead of the rumored GeForce RTX 4050 and RTX 4060 GPU launch in May-June. Furthermore, Nvidia has not yet attempted to drop prices into the sub-$500 range. While testing and assembly procedures do take time, they are not as lengthy as wafer production, meaning a delay of a few weeks in ordering OSAT services is unlikely to cause significant problems for the market, especially given the globally slow demand for new PCs.

With reports of a severe downturn in PC and laptop sales, many people and businesses may be opting to stick with their current systems amid economic uncertainties. However, as this information comes from an unofficial source and lacks many details, it should be taken as a rumor rather than a confirmed fact.

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