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Nvidia has created new, unique cards for use by cryptocurrencies miners.
Images of Justin Sullivan / Getty
Nvidia
ready to release its latest quarterly report at a difficult time in the semiconductor industry. There are not enough chips for products from cars to the graphics cards made by Nvidia, and too many customers.
Among the Covid-19 pandemic, the demand for Nvidia videogame chips (ticker: NVDA) has far outweighed the number of users seeking the cards they carry. into. Prices remain high in high-end markets, according to a report twice the company’s recommendation, more than a quarter after the Ampere-based chips became available.
As gamers – or cryptocurrency miners, another group of buyers – may have believed there may be a lack of supply, rising demand has raised forecasts for fiscal fourth-quarter sales in Nvidia videogame share to $ 2.39 billion. That’s nearly half of the total revenue of $ 4.82 billion Wall Street expects. This was the largest dollar amount the videogame segment has generated in Nvidia history
The consensus estimate for adjusted earnings per share is $ 2.81 per share.
The figures are due after the close of trading on Wednesday. To keep investors happy, it looks like the company needs to both meet these expectations and raise its financial projections for this quarter. Large-scale demand has put semiconductor manufacturers in a position to either meet expectations, or face a share price penalty.
“We see Nvidia’s gaming industry as particularly strong,” BMO Capital Markets analyst Ambrish Srivastava wrote in a note to messengers over the weekend. “While the company’s core gaming franchise is the main source of strength, we are also seeing crypto grow in demand. ”
Raymond James analyst Chris Caso wrote in a note to clients Tuesday that the company is likely to deal with an unfulfilled demand long into the current quarter, which ends in April .
Beyond videogame-driven application, cryptocurrency miners have also taken an interest in the latest Ampere-based graphics processing units, or GPUs. Cryptocurrency-related sales boosted Nvidia’s third-quarter fiscal performance, and have encouraged Nvidia to release exclusive crypto-mining cards and slow down the mining capabilities of upcoming budget videogame cards.
In 2018, a sharp drop in cryptocurrency prices left Nvidia with a significant amount of graphics card investment. That is a situation that seems to be trying to avoid repetition.
“Nvidia released more older GPUs as well as special cryptocurrencies [products]could / should allow it to take advantage of higher demand, despite suppliers’ ability to ramp up its ability to ramp up mainstream GPU production, ”wrote Wedbush analyst Matt Bryson, in a messenger note Tuesday.
RBC Capital Markets analyst Mitch Steves wrote in a note that his team forecasts cryptocurrency-related quarterly revenues of between $ 125 million and $ 200 million. Steves has a negative view of the company’s crypto-focused chips, arguing that miners are unlikely to buy specific products due to the high resale value of videogame cards.
Nvidia ‘s stock has gained 92% in the past year, and the
S&P 500
positive index 16%.
Of the analysts covering the stock, 32 are rated Nvidia at Buy, seven are at Hold ratings, and two are rated at Sell. The average target price is $ 602.15, which means an upside of around 6%.
Write to Max A. Cherney at [email protected]