Robert W. Baird & Co的分析师Tristan Gerra表示，“消费者不想购买GPU，因为他们知道目前这批GPU可能会在两个季度内被淘汰（新系列显卡或在一年内推出）。与此同时，我们相信加密相关的购买已经稳步下降。”
Although Nvidia has tried to limit its exposure to the industry, the rise in the cryptocurrency has pushed up the price of its products in secondary markets such as EBay.
As the cryptocurrency depreciated, miners’ demand for expensive computer hardware decreased. As the popular Ethernet block chain network shifts to a new acquisition method called “proof of interest”, as this method does not require the same heavy computer processing, miners’ demand for GPU is expected to be further reduced.
It is estimated that more than 1/3 of the consumer graphics card market may disappear as encryption enthusiasts give up their demand for GPU. These products are piling up on EBay and other markets. Although Nvidia’s recommended retail prices have not changed, their prices in the secondary market are down 50% from recent months.
Tristan Gerra, an analyst at Robert W. Baird & Co, said, “consumers do not want to buy GPU because they know that the current batch of GPU may be phased out within two quarters (a new series of graphics cards may be launched within a year). At the same time, we believe that encryption-related purchases have declined steadily. “
The price trend of Nvidia GPU in the secondary market is consistent with that of cryptocurrency.
The graphics card is a core hardware suitable for PC, which can convert the code into an image that can be displayed on the monitor. It is equipped with a chip called graphics processing unit (GPU), which can improve the way computers render games.
Encryption miners have found that gaming devices designed to play “Assassin Creed” or “Wild Dart” at high resolution can also be used to produce new encrypted tokens, sparking a rush to buy equipment.
An Nvidia GPU, which sells for $1499, is paid twice as much by crazy buyers. Pierre Ferragu, an analyst at New Street Research, reports that miners have bought $3 billion worth of GPU since the beginning of 2021, and now the GPU is “pouring into the secondary market”.
The question is how this shift will affect Nvidia. Nvidia is the largest GPU supplier and the most valuable chipmaker in the United States. The company acknowledges that the slowdown in demand from encryption miners has affected demand for some products. Nvidia is not the only company facing potential impact. AMD (AMD.US), known for its personal computer processors, has also been affected.
Colette Kress, Nvidia’s chief financial officer, said on a quarterly conference call last month: “the slowdown in the growth rate of the ethernet cash rate may reflect a decline in mining activity on GPU.” “We expect the contribution [to encrypt miners’ demand] to gradually decrease in the future.”
Nvidia has struggled for years over how to deal with the encryption industry. While demand from miners has boosted sales, the vagaries of the market have suddenly made performance harder to predict. The situation peaked at the end of 2018 when the company blamed the weak forecast on the collapse of the cryptocurrency. Nvidia warned that revenue would be hundreds of millions of dollars lower than Wall Street had expected, causing its shares to fall 20 per cent in just two days.
The company doesn’t want this to happen again, so it reduces mining efficiency for gamers like GPU (the GeForce brand). The company also released a GPU designed for the encryption market, which cannot be used in games because of the lack of hardware to connect to the monitor.
Even so, the Securities and Exchange Commission (SEC) criticized Nvidia for not fully explaining its source of income to investors in previous quarters. In May, SEC fined Nvidia $5.5 million for failing to fully disclose the impact of reduced cryptocurrency mining activity on its GPU sales.
At the same time, sales of Nvidia’s more targeted new encryption products have fallen. In February, Nvidia said it sold only $24 million of related products in the fourth quarter, less than about 1 per cent of total game-related sales in that quarter.
This shows that Nvidia’s days as a supplier of cryptocurrency are getting shorter and shorter. Huang Renxun, Nvidia CEO, said demand from gaming and data center customers, who use the company’s chips to power artificial intelligence, remains strong. Nvidia’s total revenue has grown by more than 50% in each of the past two years.
“the underlying momentum in the gaming industry is really solid,” Huang Renxun said on the company’s latest quarterly conference call last month. “
As a result, the company will still be affected by the cryptocurrency boom. Baird’s Gerra estimates that up to 35 per cent of consumer graphics cards were purchased by miners during a period of rising cryptocurrency prices. Many of these products are going to the secondary market and could erode Nvidia’s sales.
The price of Nvidia’s GeForce 3080 on EBay has fallen to $793 in the past two months from $1100 at the end of April, according to MarkSight. This is good news for gamers, who can now buy hardware without spending a lot of money.
Jon Peddie, an industry researcher, said: “as the demand for encryption decreases, speculators have also withdrawn from the market.”
And the cryptocurrency miner market is unlikely to make a comeback any time soon. The new technology no longer uses computers to generate Ethernet tokens, but turns to the bidding process. Companies that use existing assets as collateral will receive new quotas.
On the plus side, the loss of encryption customers will make it easier to measure the needs of Nvidia’s traditional buyers, says Baird’s Gerra.