Nvidia reported another blow out quarter on Thursday, and that included extremely healthy revenues from crypto miners.
The chip maker reported earnings for Q1 2019, and like the previous quarter, its executives discussed how the demand from crypto miners were helping its business.
Here, we’ll go over the results.
Keeps getting better
When we reported Nvidia’s Q4 2018 results, we noted that Nvidia’s executives were surprised at the strong demand from the cryptocurrency market. Seems like they need to get used to that demand.
For the quarter ending April 29, the company reported selling $289 million worth of the cards that crypto miners thrive on using to do create their coins.
Keep in mind that Nvidia’s chips are not just appealing to miners, but to gamers as well.
For the last quarter’s reporting, Colette Kress, executive vice president and chief financial officer, said the company wanted to “concentrate on our miners separately.” That way, observers could get a better picture of what the company did in terms of the first quarter in terms of miners.
During the call, Kress said the following about the effect of crypto mining on its business.
“Cryptocurrency demand was again stronger than expected, but we were able to fulfill most of it with crypto-specific GPUs, which are included in our OEM business at $289 million. As a result, we could protect the vast majority of our limited gaming GPU supply for use by gamers. Looking into Q2, we expect crypto-specific revenue to be about one-third of its Q1 level.”
When they’re not gaming, they’re mining
Jen-Hsun Huang, Nvidia’s founder and chief executive officer, said crypto miners bought a lot of the company’s GPUs during the quarter and that drove prices up. While the company has enjoyed climbing sales for its cards, Huang said he expects that to slow in an interview with MarketWatch following the conference call.
He also pointed out something interesting about what gamers do when they’re bored with that.
“There is no way to tell [if some crypto sales were included in gaming] because a lot of gamers when they aren’t playing games, they’re doing a little mining,”
Huang said in a conversation after Nvidia’s conference call. “The reason why they bought it is for gaming, but while they’re not gaming — while they’re at school, at work, or in bed — they’ll turn it on and do a little mining. There’s nothing wrong with that, I think that’s fine, but the real reason why they bought it is for gaming.”
Competiton
One of the analysts on the call asked about Nvidia’s competition, AMD.
“So your competitor thinks that just 10% of their sales were from crypto or like $150 million, $160 million. And you guys did almost $300 million there. And perhaps I think there could actually be some in gaming as well, which would imply that you guys have two-thirds or more of that market?”
Huang replied as follows:
“Well, we try to as transparently review our numbers as best we can. Our strategy is to create a SKU that allows the crypto miners to fulfill their needs and we call it CMP. And to be – as much as possible, fulfill their demand that way.
Sometimes, it's just not possible because the demand is too great but we try to do so. And we try to keep the miners on the CMP SKUs as much as we can. And so I'm not exactly sure how other people do it, but that's the way we do it.”
This article appeared first on Cryptovest
