What The Latest Steam Gaming Data Means For AMD, Nvidia

Bank of America Merrill Lynch identified seven takeaways from May Steam PC gaming data for the gaming GPU market.

Analyst Vivek Arya expects the next-generation NVIDIA Corporation NVDA Volta/Turing game cards are still on track to be released by the end of 2018.
Consensus analyst estimates for quarter-over-quarter Nvidia gaming sales growth of 9 percent in Q3 and 1 percent in Q4 are too low, the analyst said.
New games announced for the Nintendo NTDOY Switch at E3, including “Fortnite,” “Super Smash Bros” and “Pokemon,” could drive upside to Nvidia’s 2019 unit growth numbers, Arya said.
BofA sees no real near-term competitive threat from Advanced Micro Devices, Inc. AMD in the high-end PC gaming market and said the next-generation Navi GPU will not be coming until 2019 at the earliest.
Arya estimates only about 26 percent of gamers are using at least a GTX 1060-level card, suggesting 74 percent of gamers will need to upgrade to a better card to effectively play many of the newest games.
BofA found that 75 percent of Steam gamers use Nvidia cards, but AMD’s card share increased by 0.3 percent in May to 15 percent, with the remaining users relying on integrated graphics from Intel Corporation INTC.
AMD’s share of the CPU market has doubled from 8 percent in January to 16.3 percent in May thanks to Ryzen, Arya said.

Arya has the following targets and ratings for the stocks mentioned:

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