Nvidia Will Focus on Gaming Because Cryptocurrencies Are 'Volatile' (vice.com)

Graphics card manufacturer Nvidia made almost $10 billion dollars in the last fiscal year, that's up 41 percent from the previous period. The GPU company broke the news to its investors in a conference call on Thursday, and said that video games such as Star Wars: Battlefront II and Playerunknown's Battlegrounds as well as the unprecedented success of the Nintendo Switch led to the record profits. That and cryptocurrency. From a report: Graphics cards are the preferred engine of today's cryptocurrency miners. It's led to a shortage of the GPUs, a spike in their prices, and record profits for the company that manufactures them. "Strong demand in the cryptocurrency market exceeded our expectations," Nvidia chief financial officer Colette Kress told investors during its earnings call yesterday. "We met some of this demand with a dedicated board in our OEM business and some was met with our gaming GPUs." But Nvidia is having trouble keeping up with the demand and it's recommended retailers put gamers ahead of cryptocurrency miners while supply is limited. Kress acknowledged the shortage on the call and reaffirmed Nvidia's commitment to gamers. "While the overall contribution of cryptocurrency to our business remains hard to quantify, we believe it was a higher percentage of revenue than the prior quarter," she said. "That said, our main focus remains on our core gaming market as cryptocurrency trends will likely remain volatile." When Kress finished her statement and opened up the line to questions, the first question was about cryptocurrency. "Is crypto being modeled more conservatively?" An investor from Evercore asked. "We model crypto approximately flat," said Jensen Huang, Nvidia's chief executive officer.

Comments

Re:Dumb

[Anonymous Coward]

except everything points to big budget gaming is rising and fake money is falling

might want to get more up to date than 2 years ago

It's sensible for nVidia to put gamers first

[Opportunist]

Let's be honest here, crypto-mining seems to be on the way out now that the bubble has deflated. But even if it was still soaring, it's nothing to bet your company's future on.

nVidia has a competitor. AMD/Radeon. Right now, nVidia is what game makers optimize and tweak their engines for, so nVidia can sell their cards at a premium to gamers, knowing that gamers want their cards rather than buying from the competition, because, well, let's face it, the compatibility is simply higher. Since nVidia cannot deliver enough units to satisfy both demands, miners and gamers alike, one of them will have to look for alternatives.

If they go for the low hanging fruit and simply crank out mining rigs that will probably still sell like hotcakes (and you can make a pretty penny with it right now because miners can easily afford turning the profits they make back into mining systems, that system keeps itself running), gamers will not be able to buy an nVidia card, even though they would want one, and will look for alternatives. And at some point, it will actually make sense for studios to stop optimizing for nVidia and start looking at how to tweak their games for AMD because now suddenly the majority of their customers, i.e. gamers, is using AMD hardware.

This would be devastating for nVidia. And pretty much the very LAST thing they could possibly want.

Because at some point, mining is saturated. We probably have already reached that point, but I don't want to discuss whether BTC will rise again or whether it's plummeting back to penny stock quality, because it does not matter. What matters is that it's a risk. It may work out, it may not.

Gamers have been here, are here and will be here. And they needed, need and will need fast GPUs. Yes, they need fewer GPUs than the miners do. But if you can't satisfy the market demand anyway, why risk anything?

Should they care?

[Espectr0]

This is just public speaking to make them look good. In reality, they don't care who is buying their products as long as they get sold. In fact i would say they like crypto miners even more since they will tend to fry their hardware from extended use and they get an additional sale.