Nvidia Sees Massive Drop in GPU Sales to Cryptocurrency Miners
Despite the company posting revenue of $289 million in Q1 from crypto-related sales, Nvidia (NVDA) saw a massive drop-off in GPU demand from cryptocurrency miners in Q2. According to an earnings statement that was released on Thursday, Nvidia only recorded $18 million in total crypto-specific revenue.
During the latest conference call, Nvidia chief financial officer Colette Kress told analysts that the actual revenue from crypto products was a significant miss from what the company anticipated at the end of Q1.
Our revenue outlook had anticipated cryptocurrency-specific products declining to approximately $100 million while actual crypto-specific product revenue was $18 million, and we now expect a negligible contribution going forward.
While Nvidia beat expectations on both earnings per share ($1.76 actual vs $1.66 per share as expected) and total revenue ($3.12 billion vs. $3.10 billion), company shares dropped 4.9% Friday on poor guidance for future revenue and crypto sales.
Kress acknowledged the impact that the drop in cryptocurrency mining demand will have on the company’s GPU sales but is hopeful that both its data center and gaming segments will pick up the slack. Moving forward, Kress sees GPU sales for cryptocurrency mining as a “negligible contribution.”
Nvidia competitor, AMD (AMD), saw a similar downturn in Q2. The company posted $1.09 billion in revenue from its Computing and Graphics segment, which marked a jump of 64% year-over-year. However, AMD noted that quarter-over-quarter GPU sales have declined due primarily to lower demand from cryptocurrency miners.
Despite the selloff, Nvidia stock is still up almost 35 percent since the beginning of the year.
Disclaimer: This article’s author has cryptocurrency holdings that can be tracked here. This article is for informational purposes only and should not be taken as investment advice. Always conduct your own due diligence before making investments.