Nvidia wants to use up stocks of GeForce cards and expects sales decline as a result

By admin On Nov 16, 2018

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Nvidia expects a revenue decline of at least 30 percent for its GeForce GPU division in the coming quarter compared to the current quarter. The market has to eliminate stocks of cards with Pascal GPUs due to contraction in the crypto mining market.

Nvidia CEO Jen-Hsun Huang speaks of a crypto hangover in the explanation of the figures for the third quarter. Crypto mining caused a shortage in the video card market last year and early this year, causing prices to rise. “We expected prices to fall and sales to increase, but it took longer than we thought,” said the CEO. This mainly concerns midrange video cards with the Pascal GPU.

Inventories will also remain large in the fourth quarter and possibly the following quarter, which means less money is coming in to the company. That turnover decreases from quarter to quarter by at least 30 percent, confirms Nvidia in questions about the explanation of the quarterly figures. It’s been a long time since GeForce quarter-over-quarter sales had such a decline. In the fourth quarter of last year, Nvidia’s revenue rose sharply compared to the previous quarter. Nvidia will no longer supply the popular GTX 1060 with Pascal GPU to partners in the coming quarter, in order to eliminate the existing stocks that are already in the market.

Gaming revenue was $1.76 billion in the quarter. That was 13 percent higher than last year but 2.3 percent lower than the quarter before, despite the arrival of the RTX video cards for the high-end. They appeared at the end of September and the sale of these was therefore partly part of the turnover of the past quarter. It was mainly those cards and strong sales of gaming laptops that drove the revenue growth compared to last year, according to Nvidia.

Nvidia’s total revenue was $3.18 billion, which was 2 percent higher than last quarter and 21 percent higher than a year ago. The Datacenter division, in particular, performed well, with sales up 58 percent year-on-year to $792 million.