![]() So, any weakness on this front could derail the company's impressive growth momentum and cause the stock to lose more ground considering its rich valuation. The company generated $12.5 billion in revenue from its gaming business in fiscal 2022, up 61% from the prior year. ![]() All of this indicates that Nvidia's video gaming business may be headed for a near-term slowdown. Declining PC sales would further restrict sales of graphics cards as Nvidia will have a smaller pool of customers to whom it could sell its GPUs. Market research company IDC estimates sales of PCs were down 5.1% in the first quarter of 2022 following two years of solid growth. Throw in the fact that sales of personal computers are slowing down, and it is easy to see why Nvidia is heading into its quarterly report in a challenging environment. Such a scenario means a nice chunk of GPU sales could disappear and shrink Nvidia's addressable market. Additionally, it won't be surprising to see preowned graphics cards used by cryptocurrency miners flood the market. Jon Peddie Research estimates miners accounted for a quarter of GPU sales in the first half of 2021. Though the company believes that the demand for gaming GPUs continues to remain strong, Nvidia investors should be a worried lot as the chip giant has been hurt badly in the past thanks to weak cryptocurrency GPU demand. Reasons to sell Nvidia stockĬonsumer electronics company Asus recently pointed out that the demand for graphics cards used by cryptocurrency miners is cooling down.
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