In an unexpected twist, the surging costs of VRAM and other essential components for graphics cards, primarily fueled by the soaring demand for Nvidia GPUs, appear to have backfired on the company. A recent report reveals that Nvidia’s expenses for servicing warranty claims related to its GPUs have skyrocketed by over 1,000% in just one year, amounting to nearly 4 million.
While referring to 4 million as “nearly billion” might seem like a stretch—given the 6 million difference—it’s crucial to recognize the significant leap from the previous year’s warranty claims, which stood at a mere million. This data comes from Warranty Week, a publication dedicated to warranty management professionals, which has meticulously tracked warranty payouts in the GPU sector over the years. Their latest findings, covering up until the end of 2025, were compelling enough to warrant a deeper examination of the industry.
Warranty Costs and Revenue Dynamics
The standout figure of 4 million is striking, particularly as it exceeds the previous year’s warranty claims cost by more than tenfold. One might attribute this surge to the explosive demand for Nvidia GPUs and the corresponding increase in revenue. However, Warranty Week’s analysis reveals a more complex picture. The warranty rate—representing the cost of warranty claims relative to revenue—indicates that Nvidia’s warranty expenses have escalated at a rate far surpassing its revenue growth. In 2024, the warranty rate was 0.1%, but by 2025, it had surged eightfold to 0.9%. This suggests a potential rise not only in the number of claims but also in their associated costs.
Nvidia is not alone in facing rising warranty costs; AMD has also experienced notable changes. However, AMD’s warranty claims only doubled, increasing from 0 million in 2024 to 8 million in 2025. Additionally, AMD’s warranty claim rate saw a more modest rise of 75%, moving from 0.4% to 0.7%. While these figures are lower in proportional terms, it is essential to note that AMD has historically maintained a higher warranty rate, averaging around 0.5%. In contrast, Nvidia’s rate has typically remained below 0.1%, with two significant spikes occurring in late 2022 and last year.
The report leaves some questions unanswered, particularly regarding the impact of rising VRAM prices on warranty claim costs. The timeframe considered for overall warranty costs only captures the onset of these price increases at the end of last year. However, the warranty rate chart, which is detailed by quarter, shows a strong correlation with the period when VRAM prices began to escalate rapidly, although this alone does not account for the entire shift in total costs.
Moreover, the report does not clarify whether the widely discussed incidents of melting RTX 5090 cards have influenced warranty rates. Given that similar issues affected the RTX 4090 and that there is no strong correlation between the launch period of the RTX 4090 and an increase in warranty rates, it seems unlikely that this factor plays a significant role.
