Nvidia Calls Off Cryptocurrency Mining Production Amid Low Earnings

Nvidia Calls Off Cryptocurrency Mining Production Amid Low Earnings

Graphics chip manufacturing giant Nvidia saw huge growth in late 2017 and throughout most of 2018 as demand for its high-end Graphics Processing Units (GPUs), used for cryptocurrency mining, skyrocketed. The recent bear market has caused demand for GPUs to dwindle, leaving Nvidia to readjust its strategy.


Nvidia In Its Heyday

It seems Nvidia is throwing in the towel on the development and production of its cryptocurrency mining focused graphics cards and chips.

Nvidia has seen some explosive growth over the last few years and is currently seeing a 68% increase in value in the past year alone (indicated below in yellow), although this week the stock price has slipped almost eight percent (indicated below in red).

Nvidias biggest rival, Advanced Micro Devices (AMD), also saw record highs recently, gaining more than 100% in just the past quarter.

Nvidia was especially successful riding the waves of the huge cryptocurrency boom of November and December, gaining an impressive 42% from November 2017 to its all-time high of $267 per share in June 2018 (indicated below in blue).


Demand for its highest-end GeForce series GPUs surged as the price of Bitcoin 00 shot from $5,800 to almost $20,000 in the span of 1 month creating a buying frenzy from miners and resellers looking to cash in on the crypto-craze.

The recent market downturn, however, has left Nvidia with a lot of unexpected extra stock due to fading interest and market sentiment. Nvidia and AMD must be prepared to adapt their business models and plans to suit a prolonged cryptocurrency bear market.

Bloomberg writes inMy Broadband:

Nvidia said it had expected about $100 million in sales of chips bought by currency miners in the fiscal second quarter. Instead, the total was $18 million in the period, and that revenue is likely to disappear entirely going forward.


Planning For The Future

Nvidia CEO Jensen Huang plans to trim cryptocurrency mining production out of the budget.

In a conference call yesterday, Huang spoke about moving down new avenues and focusing on Nvidias strengths for the remainder of the year.

Our core platforms exceeded our expectations, even as crypto largely disappeared. Were projecting no crypto mining going forward, he said.


Although cryptocurrency mining helped give Nvidia a short-term boost in revenue and market value, the company cannot continue to keep up in competition with mining goliaths, like the Chinese-owned Bitmain. Bitmain produces and uses ASIC miners that are able to mine much more efficiently than the best Nvidia cards.

Nvidia will instead build upon their strengths, particularly in the computer gaming, artificial intelligence, and data processing sectors.

Graphics card junkies are on the edge of their seats for the upcoming Geforce 20 series chips, with new Turing chip architecture. First looks at the chips are claiming the top of the line Geforce RTX Titan can outperform Nvidias current top card, the 1080 Ti, by 50 percent.

Despite a small tumble this quarter, the future still seems bright for Nvidia.

What do you think about Nvidias exit from cryptocurrency mining production? Will the company still continue to gain value in 2018? Let us know your thoughts in the comments below!

Images courtesy of Tradingview, Shutterstock

The post Nvidia Calls Off Cryptocurrency Mining Production Amid Low Earnings appeared first on Bitcoinist.com.

18.08.2018 / 00:05 96
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