Due to the ongoing decline in cryptocurrency mining, Nvidia Corp. shares dropped 5% on Friday to close the day at $244.82, down from $257.44 on Thursday. Analysts for the company are estimating third-quarter earnings of between $3.19 and $3.32 billion.
The drop follows a Wednesday-to-Thursday loss of nearly 6.5% for the US-based GPU manufacturer. The loss comes amid reports that Nvidia’s cryptocurrency-related sales were significantly lower than expected in Q2 2018. Furthermore, according to Marketwatch, the company isn’t counting on any such sales for the remainder of the year.
Nvidia’s Chief Financial Officer, Colette Kress, stated:
Our revenue outlook had anticipated cryptocurrency-specific products declining to approximately $100 million, while actual crypto-specific product revenue was $18 million.
Whereas we had previously anticipated cryptocurrency to be meaningful for the year, we are now projecting no contributions going forward.
This is in stark contrast to a year ago, when Chief Executive Jensen Huang spoke enthusiastically about cryptocurrencies and the crypto mining market:
Crypto is here to stay, and the market will grow to be quite large. […] It’s not likely to go away any time soon. There will be more currencies to come, they will come from different nations…We stay very close to the market, and understand the dynamics very well.
Nvidia Down But Not Out
Despite the fact that Nvidia’s PC and mobile OEM revenue, in which cryptocurrency related sales are included, fell by 54% to $116 million, the company realized significant gains in other areas:
- Gaming revenue up 52% to $1.81 billion
- Data center revenue up 83% to $760 million
- Visualization revenue up 20% to $281 million
- Auto-related revenue up 13% to $161 million
In total, Nvidia reported total second-quarter earnings of $1.1 billion – an increase of more than 50 percent from Q2 2017 earnings of $583 million.
Do you think that Nvidia will see a resurgence in cryptocurrency related earnings once the market recovers? Let us know in the comments below.
Images courtesy of ShutterStock
Check out the original article here.
Author: Devashish Bhuyan