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A sign is posted in front of the Nvidia headquarters
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Nvidia has a complicated relationship with cryptocurrency miners. They buy lots and lots of chips—so many that gamers, who the cards were designed for, have had trouble finding them.
When the company reported earnings late Wednesday, its numbers were far better than expected, in large part because of its videogame segment. As in the past,
Nvidia’s
(ticker: NVDA) new line of RTX 3000 cards has been popular among cryptocurrency miners interested in Ethereum.
Nvidia logged videogame sales of $2.7 billion for its fiscal third quarter, well above the consensus estimate of $2.1 billion. Sales of videogame chips, which include those made for
Nintendo’s
Switch system, helped results. The segment also got a lift from Nvidia’s launch of its Ampere-based game cards in September.
Sales to miners generated at least $175 million in the third quarter, accounting for much of the outperformance, according to a Thursday note from RBC Capital Markets analysts Mitch Steves. Before the results came out, he had estimated sales to miners would be $150 million.
The Ampere graphics processing units, or GPUs, are popular among Ethereum crypto miners, as it is one of the primary currencies to use GPUs for mining. Technical changes to Ethereum that will take effect around Dec. 16 mean that much of the older hardware Ethereum miners currently use won’t work anymore. As a result, Steves wrote, they are buying GPUs and Nvidia’s look pretty good.
According to an estimate Steves made in September, it would take an Ethereum miner 233 days to achieve profitability with an unmodified RTX 3080 card. Steves wrote then that the RTX 3080 nets Ethereum miners about $3 per day. The RTX 3080 is supposed to retail for $699, but suffered from shortages at launch.
Nvidia said Wednesday that it continues to face supply constraints for its chips and cards in the fiscal fourth quarter, which ends in January.
Nvidia shares were flat in Thursday trading at about $537. The stock has risen 128% so far this year, as the
PHLX Semiconductor
index rose 39%.