Nvidia Lovelace gaming card launch in ‘really good place’ as models start at $899

Nvidia Corp. is well-positioned to launch its next generation of gaming cards amid a consumer slump, the chip maker told Wall Street Tuesday as it unveiled its next-generation chip architecture following a painful year of preparing for it.

During the keynote address of Nvidia’s

GPU Technology Conference Tuesday, Chief Executive Jensen Huang unveiled gaming chips using the company’s next-generation “Ada Lovelace” architecture by introducing the flagship RTX 4090 for a suggested retail price of $1,599. The new gaming chip, which is said to perform up to four times faster than its previous generation RTX 3090 Ti, will be available on Oct. 12.

The new architecture is named after the 19th century English mathematician Ada Lovelace, generally considered to be the world’s first computer programmer for her work on Charles Babbage’s theoretical Analytical Engine.

Following the keynote, Huang told analysts that while gaming end markets are soft, they’re not so soft that Nvidia will not be able to sell through excess inventory it has in the channel.

“We’re in a really good place at the moment,” Huang told analysts. “We took specific action, marketing programs to particularly reduce the segment that Ada is going into initially.”

Huang reminded analysts that Lovelace has already been delayed so the company had enough time to put into place marketing programs and clear out inventory channels, and that ramps go from the top down, serving gamers who want the latest chip first.

In preparation for that, the company “took two quarters of really harsh medicine,” Huang told analysts, referring to several profit warnings during the year as the company hacked away at its revenue forecast and took a $1.22 billion inventory charge prior to the launch.

Huang also introduced the RTX 4080 gaming card, starting at $899, meant to run up to four times faster than the RTX 3080 Ti, along with a 16 GB version starting at $1,199.

Huang said the RTX-3000 series will also remain available for mainstream gamers with the RTX 3060 starting at $329.

Read: Nvidia sales forecast falls about $1 billion short of expectations, stock falls

The Lovelace architecture succeeds Ampere, which was unveiled about two months into the COVID-19 pandemic amid strong demand for gaming cards that sent the stock to a 122% gain in 2020, compared with a 51% gain on the PHLX Semiconductor Index

Now, Nvidia is launching into an environment when gaming demand is falling during a consumer tech slump, and the stock has dropped 55% year to date, compared with a 35% decline on the SOX index.

The company also launched a Lovelace GPU for designers and creators, the RTX 6000 workstation, which will begin shipping in the fourth quarter.

Read: Chip stocks could plunge another 25% as ‘we are entering the worst semiconductor downturn in a decade,’ analyst says

Cutting-edge Lovelace architecture is also necessary to support Nvidia’s expansion into Omniverse, its foray into the so-called metaverse, Huang said.

During the keynote, Huang also unveiled Nvidia Omniverse Cloud, the company’s first Software-as-a-Service and Infrastructure-as-a-Service product, to design, publish, operate and experience metaverse applications, the company said.

The service includes such features as “Omniverse Nucleus Cloud” which provides 3-D designers and teams the ability to make changes and share scenes from nearly anywhere, Nvidia said.

Read: Nvidia’s ‘China Syndrome’: Is the stock melting down?

Early customers of Omniverse Cloud include ad agency WPP


and Siemens
Nvidia said.

With declining consumer demand, Nvidia’s largest unit recently became it data-center business with a $3.81 billion quarterly revenue contribution, a gain of 61% year over year, versus a 33% fall in gaming sales to $2.04 billion from a year ago, according to the company’s most recent earnings report.

Nvidia shares were last down 2% in Tuesday trading, compared with a 1.7% decline on the S&P 500 index

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