Over the last year, Nvidia has always told investors to desist from relying on revenue generated from selling Graphics processing units (GPUs). These tools have proven essential for most cryptocurrency miners and the company is renowned as the biggest manufacturer of these devices worldwide.
However, regardless of the high demand arising from the crypto boom in recent years, the company has insisted that investors should not anticipate significant revenue from that business. CEO Jensen Huang believes that cryptos will be around for years to come. He also asserted that the company will always aim to ensure that crypto takes up a significantly small part of the company’s business.
On the contrary, after the company reported earnings on November 15, 2018, Wall Street discovered that Nvidia deeply relies on digital money for their growth. In the earnings report, the company forecasted around $1 billion less revenue for the forthcoming quarter than markets expected .
The reason for this downward revision of expected revenue comes as a result of the company expecting cryptocurrency revenue to dwindle. Also, a large amount of unsold inventory of older products caused the company to project their earnings downwards. After the recent Bitcoin plunge, Nvidia’s stock dropped over 15% in the aftermath currently pegged around $170 (Pre-market).
www.marketwatch.com data chart.
The CEO stated in a press release that their short-term results and projections reflect excess channel inventory after the decline in the crypto-currency boom. The stock had earlier lost over 5% in the last quarter when the company admitted that its crypto revenue was taking a downward trend .
The company’s management also told investors at that time that they would not include any contribution from the crypto market in their earnings outlook. The more Nvidia tries to take a stance away from the crypto market, the more they get entangled into it.
For now, as investors watch and wait to see where the crypto markets are headed to, Nvidia tries to collect the ‘rubbles’ that remain after the markets dwindled.
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The post Nvidia Tumbles over Crypto Woes, Reaches 12 Month Low appeared first on Cryptovibes.com – Daily Cryptocurrency News .
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