China's GPU sales fell 8 percent from October to November due to shortages but are still up 11 percent YoY

The Chinese graphics card market has declined 8% from October to November, per a report from Board Channels (via Expreview). Among the eight largest manufacturers of graphics cards, "the overall shipment status showed a downward trend" due to a lack of sales at physical shops.

Not every brand's sales declined; in fact, four brands showed growth. However, GALAX showed no growth, while Colorful, Gigabyte, and Maxsun declined considerably. Given how much market share Colorful has in China, its decline was a big reason why the overall market in China decreased so much since October, despite the good health of other brands.

On the other hand, the market actually grew 11% year-over-year, though Board Channels didn't provide further details on what brands excelled and which didn't.

The apparent cause for decreasing sales is weaker demand for graphics cards at physical storefronts, while online sales have apparently been fine. Shortages for popular GPU models, including the RTX 3060, were allegedly behind the poor performance of retail stores. 

The wider economic situation in China is undoubtedly also a factor, as the country is seeing low consumer spending. One of the most critical issues for China is its deflation, which increases the value of its currency, as opposed to inflation, which sees the value decline. Deflation encourages consumers to hold onto money and thus spend less, which in turn reduces consumer demand.

U.S. sanctions against China are also a potential factor, as Nvidia's RTX 4090 is no longer legally exported to China. Although Nvidia is rushing out its legally compliant RTX 4090D to replace the original 4090, it seems likely that the 4090's temporary absence from the market will have a negative impact on sales.