The post-gamer period: What if Nvidia abandons PC gaming?
Think about it’s the 12 months 2030 and Nvidia has simply introduced its latest RTX 7000-series graphics playing cards. However the least expensive of the playing cards is priced over $2,000 and the highest mannequin is sort of double that. The sequence supply minimal uplift on rendering efficiency, however they’re extremely good at accelerated upscaling and body era. Plus, reminiscence bandwidth is sort of double over the last-gen fashions.
Let’s proceed the hypothetical: Nvidia’s new xx60-series playing cards aren’t anticipated for months whereas Nvidia stockpiles sufficient faulty GPUs. However don’t fear for those who can’t afford these new playing cards or don’t wish to wait. Why? As a result of GeForce Now affords the complete improve proper now for an “inexpensive” month-to-month price, particularly with an annual sub locked in.
I wrote the above as a nightmare state of affairs, but it surely’s odd how shut it sounds to the launch of the RTX 50-series. It’s a historical past that appears prone to repeat and speed up as Nvidia’s gaming division turns into an ever-more-minor aspect hustle to its AI initiatives.
Nvidia might successfully hand over on gaming within the close to future, and that could be probably the most financially wise factor to do if the AI bubble doesn’t burst. However what would occur in the event that they did?
Simply observe the cash
The numbers behind my pessimistic prognosis paint a stark image. Nvidia’s Q3 2025 income topped $57 billion. Guess how a lot of that cash got here from information facilities? A whopping $51.2 billion. That’s simply shy of 90% of its whole income and represents a 25% enhance over the earlier quarter and a 66% enhance 12 months on 12 months.
How a lot income do you assume Nvidia pulled in from gaming? A measly $4.3 billion by comparability. That’s down 1% on the earlier quarter, and that’s regardless of having probably the most highly effective graphics playing cards obtainable and with inventory and costs being way more favorable than they had been earlier within the 12 months. It’s nonetheless up 30% on final 12 months, however the distinction in potential between information facilities and gaming is staggering.
Nvidia
Certainly, gaming makes up lower than 8% of Nvidia’s whole income as of now, and though the general revenue from gaming continues to extend, it’s miniscule compared to its information heart take. Bullfincher highlights how rapidly that’s modified, too: only a few years in the past, gaming represented over 33% of Nvidia’s whole income.
The place do you assume it’s going to be in one other 5 years? Assuming the AI bubble doesn’t pop as catastrophically because it might, gaming goes to grow to be a tiny footnote on Nvidia’s steadiness sheet. Will Jensen Huang even hassle doing gaming {hardware} keynotes at that time?
Mark Hachman / IDG
Nvidia could be the most important megacorp on this house, however its contemporaries present related gaming pink flags on their steadiness sheets. AMD made simply over $9 billion this previous quarter, however $4.3 billion was from information heart gross sales whereas solely $1.3 billion got here from gaming. That’s significantly better than final 12 months—when information facilities introduced in $3.5 billion and gaming simply $462 million—however information facilities are nonetheless a far larger portion of AMD’s income than gaming.
These numbers make a compelling case for giving up some curiosity and funding in gaming {hardware} improvement. It doesn’t imply they’re going to cease make gaming GPUs totally. (Or does it?) However for those who’re Jensen Huang going through off towards shareholders who’re demanding the income numbers go up as a lot as potential as quick as potential, what are you going to promote them on: a brand new gaming GPU that has traditionally low margins, or a brand new era of information heart {hardware} to feed into the accelerating AI bubble with untold potential?
You possibly can even argue that Nvidia’s growing focus over the previous few years on DLSS and ray tracing over pure rasterization efficiency is an early signal of it placing its eggs within the information heart basket.
A canary within the RAM mines
The most important aspect impact of all these new information heart builds hasn’t been GPU shortage, surprisingly. (At the least, to not the diploma we noticed through the cryptocurrency craze.) Relatively, it’s skyrocketing reminiscence costs. RAM kits have elevated in value by over 200 p.c in some circumstances, making giant capability kits extra pricey than top-tier GPUs. Some modest RAM choices are much more costly than gaming consoles.
Shopper RAM is taking pictures up in value as a result of all the foremost reminiscence producers are inundated with orders for information heart reminiscence, like HBM and LPDDR. Some have begun pivoting their fabrication traces to those higher-margin reminiscence sorts, resulting in shortages of NAND chips—and, consequently, shortages of client reminiscence and SSDs.
These shortages are making RAM and SSDs far dearer. And but, regardless of the elevated margins and diminishing provide versus demand, Micron simply closed its Essential model of client RAM and SSDs.
It was worthwhile, it was well-liked, it had a definite market area of interest that served shoppers and avid gamers for many years. However even Micron didn’t see the purpose of retaining it going when it might as a substitute make heaps extra cash from promoting Micron NAND chips and server reminiscence.
And if Micron is so prepared to tug out of the patron house as a result of AI-driven demand, how far more will Nvidia be tempted to do the identical? What’s stopping Nvidia from reaching the identical conclusion?
For additional proof of this future, Nvidia is rumored to be chopping its gaming GPU provide in 2026 as a result of reminiscence shortages. It’s particularly notable how Nvidia seems to be chopping the extra inexpensive mid-range graphics playing cards first, leaving ultra-budget and ultra-high-end traces intact for now. Is that this simply step one in Nvidia leaving avid gamers behind?
The place issues might go from right here
There are some intriguing comparisons to make between Nvidia and different massive companies that discovered development and income in avenues that weren’t the place they began. IBM went from being the title in computing {hardware} to at least one that largely runs within the background. It offered off its core {hardware} companies and have become a software program and providers firm that’s nonetheless value tens of billions of {dollars}. It lately spun off once more, making a separate firm to deal with IT providers whereas the core enterprise refocused on cloud computing and AI.
Nvidia might do this: spin or unload its gaming divisions and license its GPU know-how to that spun-or-sold-off subsidiary.
Nvidia
Maybe Nvidia might even find yourself like Adobe. Within the mid-2010s, the developer of Photoshop launched Artistic Cloud and slowly pushed all its once-in-perpetuity software program licenses right into a subscription mannequin that’s nonetheless happening at the moment. May that apply to Nvidia’s GeForce Now streaming service? It had 25 million subscribers as of 2023 and ran on GPUs designed for information heart server racks. Nvidia might depart devoted desktop and laptop computer GPUs behind totally and pivot its gaming divisions into software program/hardware-as-a-service corporations.
If gaming goes an analogous strategy to TV and film streaming, it’s potential Nvidia might even pull a Netflix and slowly de-emphasize its DVD-like {hardware} enterprise in favor of powering all of it from the cloud.
Gaming received’t die, however it can change
As a lot as this text is heavy on the doom, Nvidia is unlikely to exit gaming totally. Individuals wish to play video games and there’s cash to be made there, so somebody will hold tapping that market. However how that income is extracted might change—dramatically so.
Microsoft is already speaking about making the following Xbox extra of a PC/console hybrid. And with the most recent Xbox consoles being the third wheel of this era, it wouldn’t be a shock to see the way forward for Xbox focus extra on streaming video games than shopping for/proudly owning them. Xbox Recreation Go already has over 37 million subscribers—that’s greater than the variety of Xbox Collection X/S consoles offered this era.
Nvidia might do one thing related. Or it might spin off. Or it might cease making gaming GPUs totally. The one factor we all know for positive is that this: when a gaming firm begins making astronomical quantities of cash as a result of AI-driven demand, it’s laborious to think about it wouldn’t be tempted to dive head-first into an AI-first technique on the expense of gaming.
Additional studying: PC vs. consoles? Gaming’s future is blurrier than ever
