Nvidia’s GPU Sale Substantially Declines In the Second Quarter Of 2018

Crypto mining has become less lucrative as evident from declining sales of crypto miners. Mining equipment manufacturers like Nvidia and Bitmain are watching this happen first hand as profits declines.

The recently released Q2 earnings report shows that GPU business revenue was $2.66 billion, up 40 percent from a year earlier, it was down 4 percent sequentially. The graphics card maker’s CFO, 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.”

She said that record performance in gaming, professional visualization, and datacenter services “offset” a substantial decline in the sale of cryptocurrency GPUs. Nvidia's CEO, Jensen Huang, put it another way, saying that currently, executives think cryptocurrency won't be material to the company for the second half of the fiscal year.

While the cryptocurrency impact will drag down the OEM and IP business and bring year-over-year declines in the fiscal third quarter, Kress said executives are hoping that “absolutely” Nvidia's data center business will grow, and they think the gaming business will grow as well.

Nvidia has been pretty accurate with their predictions. Back in July, they were proven right again when their GPUs declined in price. Advanced Micro Devices (AMD), the main competition of Nvidia, provided reports that their company’s interaction with blockchain or mining was about 10% of the total profit they would make. However, CEO Lisa Su held a different sentiment, calling blockchain technology “a bit of a distraction in the short term.”

Bitmain, the leading mining chip manufacturers are reportedly going public with an IPO. Part of the reason of them doing so is that their profits from previous quarters have been off the charts and there are few reasons to believe that Bitmain will be able to deliver that kind of profits in the future.

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