Nvidia made more from crypto mining than AMD, but expects a bigger drop

Nvidia is optimistic about the use of its products for cryptocurrency mining. - MarketWatch photo illustration/iStockphoto

CEO Jensen Huang expects the nearly $300 million in crypto revenue to decline by two-thirds this quarter

By Max A. Cherney – Tech reporter

Nvidia Corp. received a bigger bump from crypto mining than rival Advanced Micro Devices Inc. in the most recent quarter, but Chief Executive Jensen Huang predicts a larger drop-off is on the way.

Nvidia NVDA, -2.54%  reported $289 million in sales of cards built by third-party manufacturers specifically for mining cryptocurrencies in its first-quarter results Thursday afternoon, which caused the revenue segment that includes those cards to jump nearly 150% year over year. In an interview with MarketWatch, Huang said that some of its gaming cards—which produced revenue of $1.72 billion, up almost 68%—could be used for mining as well, but are not usually purchased solely for that purpose.

“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.”

Nvidia and AMD AMD, -1.57%  have received a lot of investor attention as a potential play on the cryptocurrency market, as miners are known to use the chip makers’ graphics-processing units, or GPUs, to mine digital coins like ether ETHUSD, -8.39%  and monero XMRUSD, -10.22%  . Graphics cards used for gaming have been scarce in the past year, and many blame crypto miners and believe that they have helped push demand and prices for the equipment higher.

AMD said last month in its earnings discussion that crypto mining was about 10% of its overall business, which collected $1.65 billion in total revenue in the quarter, suggesting about $165 million in crypto sales. Chief Executive Lisa Su made similar comments to Huang about gamers also using the cards for mining, and said that the gains from crypto sales are more sustainable than a previous boom that petered out and led to a flood of cards on the secondary market.

‘The reason why they bought [Nvidia cards] 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…’

– Chief Executive Jensen Huang tells MarketWatch

Both companies admitted that they have put in work to try to track crypto sales and interact with the mining community for more insight into crypto-related sales amid interest from investors and analysts. However, they have different thoughts about where it is headed in the near term — AMD executives said they expect a “modest decline” in crypto-related sales this quarter, while Huang predicted a more extreme drop.

“We did almost $300 million in crypto, and next quarter we expect it to be down by two-thirds of that,” Huang said.

TimeNVIDIA Corp.Jul 17Sep 17Nov 17Jan 18Mar 18May 18


Nvidia stock fell about 3% in after-hours trading Thursday following the results, after reaching record highs each of the previous two sessions. AMD stock fell about 1.5% in late trading. Nvidia shares have increased 114.5% in the past year, as AMD has added 12.4% and the S&P 500 index SPX, +0.94%  has gained 13.4%.