Nvidia Sales to Crypto Miners Wane: Is the Cryptocurrency Mining 'Goldrush' Over?
- by Patty Hardy
- in Business
- — Aug 19, 2018
Even that prediction was too high.
Nvidia managed to beat analyst estimations of 41.75 billion for its gaming sales, bringing in a total of $1.8 billion.
Raymond James' Chris Caso is optimistic Nvidia's eighth-gen GPU architecture, which the company says "is the result of more than 10,000 engineering-years of effort", will drive the company's sales later this year.
Nvidia's market cap exceeds $158 billion, and its shares closed Tuesday up $5.31 at $261.43.
In a poll by FactSet, analysts think that the company's revenue from crypto mining hardware will continue to decline, however the gaming and servers sales will see a growth spurt that will offset the losses. The company reported second-quarter net income of $1.1 billion, or $1.76 a share, compared with $583 million, or 92 cents a share, in the year-ago period.
However, when the company's report was published on Thursday, Nvidia's stock value fell by six percent. He has convinced owners of data centers that modified graphics chips are the best solution to handle the surge in artificial intelligence processing that is fueling the growing use of voice and image recognition.
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Where shares apparently got tripped up, though, was on Nvidia's guidance for $3.25 billion in revenue, plus or minus 2 percent, in the current quarter. Analysts on average estimated $3.11-billion.
NVIDIA VP, Professional Visualization, Bob Pette stated that the Quadro RTX heralds the beginning of a new era in the global computer graphics sector by providing powerful capabilities that the industry was not expecting to come to fruition this early.
"Crypto largely disappeared" from demand, founder and Chief Executive Officer Jensen Huang said today.
"Developers are jumping on the GPU-accelerated computing model that we pioneered for the boost they need", Huang said in a statement. Automotive grew 13% to $161 million. NVIDIA CFO Colette Kress said on a conference call that the company expects "a negligible contribution going forward", from crypto-specific products.
The cryptocurrency mining boom appears to be at an end, as Nvidia for one has warned that the market has topped out, and declines are ahead. Operating expenses ended up at $818 million, up by 33 percent compared to the a year ago and up by six percent from the previous quarter.
