How is it that all these tech companies are posting record quarterly results? It seems like every one of them is like that for every quarter. Even AMD has jumped on the bandwagon! Maybe it's inflation finally coming to haunt us...
Inflation has been low. The goods and services provided by the tech companies have increased the productivity of the economy. Also, consumers are spending a greater percentage of their disposable income on entertainment that's supported by technology (such as games, movies with CGI, internet streaming, etc).
Oh, there's also cryptocurrency, which probably hasn't provided much of value at this point, but has attracted speculative investments, leading to a swell in mining operations that require an investment in technology.
Prices rising across the market due to multiple factors including increased costs/ reduced gains associated with transistor size shrinks, and cryptocurrency mining. Simultaneuosly demand from the traditional gaming market has not shrunk in the face of gpu price increases. The computer market in general is seeing the results of aging generations that grew up with gaming. They now have more income and are willing to spend a large portion of it on gaming hardware. Manufacturers are realizing a new confidence in demand. Some areas even seem to be abusing it like memory manufacturers. Unfortunately it looks like gaming may face much more price inflation due to hitting extreme limitations in transistor size reduction along with manufacturers reassesing their understanding of demand in the gaming market along with other sectors taking up priority over gaming along with the increasing monderization nd growth of global markets along with resource limitations.
Ah if only I were a stock trader..3 years ago I was looking at the trends and thought, there's just no way Nvidia will not grow like crazy in the upcoming years..and I still don't see the end. Graphics processing market is actually only about to explode, and not because of the games.
"this quarter gaming revenue was up 67.7% from a year ago to $1.723 billion. Some of that growth was certainly attributed to cryptocurrency," I think the majority of that growth came from crypto, none of my gaming buddies have bought a new GPU in close to 2 years due to the insane pricing. I have a few still stuck on 290's & 780's waiting for prices to come down to MSRP. I know Nvidia had a few for sale yesterday, but by the time we got off work, they were all gone!
Not sure why it was placed there, but the very last sentence of the article states "NVIDIA is including $289 million in revenue related to GPUs for cryptocurrency mining."
Based on the numbers provided (here and elsewhere): 2019 Q1 Total Revenue = $3,210,000,000 2019 Q1 Gaming Revenue = $1,723,000,000 2019 Q1 Crypto Revenue = $289,000,000 2019 Q1 Crypto Growth YoY = 148% 2019 Q2 Total Revenue Projection = $3,100,000
We can calculate the following: 2018 Q1 Crypto Sales = $116.5m (289m / 2.48) <- 148% growth 2019 Q1 Gaming Revenue as a percentage of Total Sales = 53.676% 2019 Q1 Crypto Sales as a percentage of Total Sales = 9.00% 2019 Q1 Crypto Sales as a percentage of Gaming Sales = 16.77%
To bring this all together: Q1 2018 to Q1 2019 GPU sales growth = $695,570,000 Q1 2018 to Q1 2019 Crypto sales growth = $172,467,000 Percentage of GPU sales growth attributed to Crypto sales growth = 24.79%.
They also predicted Crypto sales in the current quarter (2019 Q2) will drop by 2/3. Given the Q2 Total Revenue projection of 3.1B (a 3.42% drop from Q1), we can calculate the following figures: 2019 Q2 Crypto Sales = $96,333,333 (Q1 crypto sales * (1/3)) 2019 Q2 Crypto Sales as a percentage of Total Sales = 3.1075% (96.3m / 3.1b)
Basically Crypto sales as a percentage of total sales will drop from 9% in Q1 to 3% in Q2. Interested to see how that drop affects both GPU sales figures and total revenue figures going forward, particularly in Q3 and Q4. Looks like NV at least thinks it's going to drop pretty steeply.
Nice analysis. I suspect the crypto percentage of gaming sales is somewhat understated since many crypto GPUs are purchased at retail, making them indistinguishable from gaming.
Nope, the post is correct - NVDA just announced their 2019 Q1 fiscal year results yesterday.
Their fiscal calendar ends January 28, so the 2019 Fiscal Q1 was 1/29/2018 - 4/28/2018. The 2019 Q4 will end 1/28/2019. **Note these dates might be off by a day...check with your advisor for confirmation.
Unless I remember wrong, there is some SEC regulation that puts some limits on how muh financial calendar can be misaligned from real calendar and Nvidia is at the very edge.
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Farfolomew - Friday, May 11, 2018 - link
How is it that all these tech companies are posting record quarterly results? It seems like every one of them is like that for every quarter. Even AMD has jumped on the bandwagon! Maybe it's inflation finally coming to haunt us...Yojimbo - Friday, May 11, 2018 - link
Inflation has been low. The goods and services provided by the tech companies have increased the productivity of the economy. Also, consumers are spending a greater percentage of their disposable income on entertainment that's supported by technology (such as games, movies with CGI, internet streaming, etc).Yojimbo - Friday, May 11, 2018 - link
Oh, there's also cryptocurrency, which probably hasn't provided much of value at this point, but has attracted speculative investments, leading to a swell in mining operations that require an investment in technology.edzieba - Friday, May 11, 2018 - link
Huge demand, supply is constrained (building DRAM fabs takes time, and everyone is hitting process scaling problems).shabby - Friday, May 11, 2018 - link
If by everybody you mean intel then yes.MrSpadge - Friday, May 11, 2018 - link
"The winner takes it all", rule nr. 1 of the internet.Opencg - Friday, May 11, 2018 - link
Prices rising across the market due to multiple factors including increased costs/ reduced gains associated with transistor size shrinks, and cryptocurrency mining. Simultaneuosly demand from the traditional gaming market has not shrunk in the face of gpu price increases. The computer market in general is seeing the results of aging generations that grew up with gaming. They now have more income and are willing to spend a large portion of it on gaming hardware. Manufacturers are realizing a new confidence in demand. Some areas even seem to be abusing it like memory manufacturers. Unfortunately it looks like gaming may face much more price inflation due to hitting extreme limitations in transistor size reduction along with manufacturers reassesing their understanding of demand in the gaming market along with other sectors taking up priority over gaming along with the increasing monderization nd growth of global markets along with resource limitations.darkich - Friday, May 11, 2018 - link
Ah if only I were a stock trader..3 years ago I was looking at the trends and thought, there's just no way Nvidia will not grow like crazy in the upcoming years..and I still don't see the end.Graphics processing market is actually only about to explode, and not because of the games.
Pneumothorax - Friday, May 11, 2018 - link
"this quarter gaming revenue was up 67.7% from a year ago to $1.723 billion. Some of that growth was certainly attributed to cryptocurrency,"I think the majority of that growth came from crypto, none of my gaming buddies have bought a new GPU in close to 2 years due to the insane pricing. I have a few still stuck on 290's & 780's waiting for prices to come down to MSRP. I know Nvidia had a few for sale yesterday, but by the time we got off work, they were all gone!
Kakti - Friday, May 11, 2018 - link
Not sure why it was placed there, but the very last sentence of the article states "NVIDIA is including $289 million in revenue related to GPUs for cryptocurrency mining."Based on the numbers provided (here and elsewhere):
2019 Q1 Total Revenue = $3,210,000,000
2019 Q1 Gaming Revenue = $1,723,000,000
2019 Q1 Crypto Revenue = $289,000,000
2019 Q1 Crypto Growth YoY = 148%
2019 Q2 Total Revenue Projection = $3,100,000
We can calculate the following:
2018 Q1 Crypto Sales = $116.5m (289m / 2.48) <- 148% growth
2019 Q1 Gaming Revenue as a percentage of Total Sales = 53.676%
2019 Q1 Crypto Sales as a percentage of Total Sales = 9.00%
2019 Q1 Crypto Sales as a percentage of Gaming Sales = 16.77%
To bring this all together:
Q1 2018 to Q1 2019 GPU sales growth = $695,570,000
Q1 2018 to Q1 2019 Crypto sales growth = $172,467,000
Percentage of GPU sales growth attributed to Crypto sales growth = 24.79%.
They also predicted Crypto sales in the current quarter (2019 Q2) will drop by 2/3. Given the Q2 Total Revenue projection of 3.1B (a 3.42% drop from Q1), we can calculate the following figures:
2019 Q2 Crypto Sales = $96,333,333 (Q1 crypto sales * (1/3))
2019 Q2 Crypto Sales as a percentage of Total Sales = 3.1075% (96.3m / 3.1b)
Basically Crypto sales as a percentage of total sales will drop from 9% in Q1 to 3% in Q2. Interested to see how that drop affects both GPU sales figures and total revenue figures going forward, particularly in Q3 and Q4. Looks like NV at least thinks it's going to drop pretty steeply.
Disclosure – I own NVDA stock.
voicequal - Friday, May 11, 2018 - link
Nice analysis. I suspect the crypto percentage of gaming sales is somewhat understated since many crypto GPUs are purchased at retail, making them indistinguishable from gaming.RedGreenBlue - Friday, May 11, 2018 - link
2019? I know fiscal calendars don’t often don’t line up with the chronological calendar, but I can’t think of how they would be a year difference.Typo?
Kakti - Friday, May 11, 2018 - link
Nope, the post is correct - NVDA just announced their 2019 Q1 fiscal year results yesterday.Their fiscal calendar ends January 28, so the 2019 Fiscal Q1 was 1/29/2018 - 4/28/2018. The 2019 Q4 will end 1/28/2019. **Note these dates might be off by a day...check with your advisor for confirmation.
zepi - Friday, May 11, 2018 - link
Unless I remember wrong, there is some SEC regulation that puts some limits on how muh financial calendar can be misaligned from real calendar and Nvidia is at the very edge.Quilleneva - Tuesday, May 15, 2018 - link
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