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Cryptocurrency and data centre drops hit Nvidia results

(Image credit: Image source: Shutterstock/MaximP)

Nvidia has seen great success selling chips for data centres, as well as hardware for cryptocurrency miners, however this has not translated into expected levels of financial results.

The company has revealed that earnings from its data centre business missed the analysts’ mark by a few million, and earnings from cryptocurrency mining is expected to drop, significantly.

According to a Reuters report, Nvidia’s data centre business rose 71 per cent to $701 million. Analysts were expecting $703 million.

When it comes to sales from chips for cryptocurrency miners – Nvidia earned $289 million, which is about nine per cent of the company’s overall $3.2 billion revenue.

Analysts had predicted somewhat lesser earnings, $200 million, but extra earnings didn’t translate to a better position for the company. Quite the contrary. Greater reliance on this business resulted in a 3.3 per cent drop in share value, due to the fact that the cryptocurrency industry is highly volatile.

Chief Financial Officer Colette Kress said that Nvidia expects earnings from cryptocurrency-related sales to drop 65 per cent in the next quarter, down to roughly $100 million.

“While supply was tight earlier in the quarter, the situation is now easing,” Kress told investors on a conference call. “Gamers who had been priced out of the market last quarter” were able to get their hands on new chips a reasonable price, she said.

Image source: Shutterstock/MaximP