Nvidia Stock Drops 6% as Cryptocurrency Miner-Related GPU Demand Dries Up

Jensen Huang CEO and founder Nvidia speaking at GTC Summit 2018

Yevgeniy Sverdlik

"We now expect a negligible contribution going forward", Kress added.

When it comes to specific departments, Jensen was quite proud to say that the company grew across every platform, and Datacenter was the clear victor with a revenue increase of 83 percent compared to the past year.

"Our revenue outlook had anticipated cryptocurrency-specific products declining to approximately $100 million, while actual crypto-specific product revenue was $18 million", she said in the report.

Nvidia's largest and oldest business of selling graphical processing units, or GPUs, for video game players beat analyst estimates, bringing in $1.8 billion compared with estimates of $1.75 billion, according to data from FactSet.

Nvidia (NASDAQ:NVDA) is warming up to post its second quarter results this afternoon, and one analyst sees a favorable setup as he expects well-documented choppiness in the gaming channel to be offset by continued robust datacenter demand and backlog. Nvidia CEO Jen-Hsun Huang said in March that the company needed to ramp up its production to ensure that both miners and gamers had sufficient graphics cards.

Ether's value has fallen from a high around $1,400 in January to around $300 today-a decline of nearly 80 percent.

Analysts were troubled by Nvidia's gross margin forecast of 62.8 percent, slightly below expectations of 62.9 percent and possibly a result of putting more memory modules on its chips. Data-center revenue increased 83 percent to $760 million.

American tech company Nvidia has reported a "substantial" decline in revenue as the cryptocurrency mining industry slows. This pattern was also observed across the board, with revenue beating analysts' prediction across markets of data centers, visualization, and auto-related revenue.

In an announcement of its second quarter earnings Thursday afternoon, the graphics card maker's CFO, Colette Kress, stated that while "GPU business revenue was $2.66 billion, up 40 percent from a year earlier", it was "down 4 percent sequentially".

The Santa Clara, Calif. -based company delivered a Q2 net income of $1.1 billion, or $1.76 per share.

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