Opinion: Nvidia Says Crypto-Mining Boom Is Over For Now

The extra boost Nvidia Corp. received from selling its graphics chips to cryptocurrency miners appears to be over, at least for now….

Nvidia Chief Financial Officer Colette Kress surprised investors — who had already been anticipating lackluster crypto sales — with an even more downbeat forecast for crypto-mining sales Thursday. Nvidia released second-quarter earnings and noted a shortfall in crypto sales in addition to the forecast.

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“Our revenue outlook had anticipated cryptocurrency-specific products declining to approximately $100 million, while actual crypto-specific product revenue was $18 million,” Kress said in prepared remarks. “Whereas we had previously anticipated cryptocurrency to be meaningful for the year, we are now projecting no contributions going forward.”

Cryptocurrency was clearly a small part of Nvidia’s overall revenue, which grew 40% in the second quarter to $3.1 billion, led by its gaming business. But as Nvidia’s graphics chips and cards have been used in the past year for mining digital currencies, its stock became popular as an alternative to cryptocurrencies for some investors.

Nvidia had experienced stronger sales earlier this year by those seeking to mine for cryptocurrency like ether, but most investors expected crypto revenue to decline after Chief Executive Jensen Huang predicted a drop while announcing first-quarter earnings results. The value of bitcoin, the largest digital currency, has lost almost half its value this year as a bear market emerged for crypto.

“We did almost $300 million in crypto, and next quarter we expect it to be down by two-thirds of that,” Huang [said] in May.

TIP


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Author: Therese Poletti
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