Nvidia presents record quarter - rejects financial effects of cryptocurrency mining

The year 2020 was a record year for large parts of the semiconductor industry due to high demand. This high demand, in turn, led to market participants who could produce circuits at all being able to cut gold with a paring knife, and one in a line of these companies was Nvidia. When the company now reports on the final quarter of 2020, it appears to be the company’s best ever – despite the lack of products on store shelves.

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1 Nvidia’s quarterly report

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Nvidia’s quarterly report

	Q4 FY21	Q3 FY21	Q4 FY20	Quarterly basis	Annual basis
Revenue	$5 003	$4 726	$3 105	+6%	+61%
Gross margin	63,1 %	62,6 %	64,9%	+50 bps	-180 bps
Operating costs	$1 650	$1 562	$1 025	+6%	+61%
Operating profit	$1 507	$1,398	$990	+8 %	+52 %
Net profit	$1 457	$1,336	$950	+ 9%	+ 53%
Earnings per share	$2,31	$2,12	$1,53	+ 9%	+ 51%

All figures, excluding earnings per share, are in millions of USD

According to Tom’s Hardware, Nvidia blames the lack of assets on the mining of cryptocurrencies, which were popularized again during the winter. During the fourth quarter of 2020, the company reached a record turnover of USD 5 billion, of which SEK 2.5 billion was in the gaming segment, to which graphics cards for consumers belong. Of this 2.5 billion, cards for crypto breakers are said to account for 100-300 million USD.

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Nvidia themselves admit, however, that the company’s estimate regarding crypto mining is something that cannot be ensured, as partners are free to sell graphics cards to whichever players they want. At the same time, Tom’s Hardware points out that the company’s investors are not happy to be associated with mining cryptocurrencies – something that may have motivated Nvidia to fine – tune the figure and claim ignorance.

We suspect that the significant increase in the Ethereum hash rate observed over the past few months was driven by a combination of previously-installed mining capacity that was reactivated, as well as news sales of GPUs and ASICs. – Collette Kress, ekonomichef hos Nvidia

To allay investor concerns, Nvidia’s CFO Collette Kress is speaking with caution about the company’s impact on the winter crypto boom. She believes that finished farms for mining cryptocurrency have been reactivated, while new sales of graphics cards have not been a driving force in the new wave of winter. At the same time, both Kress and the company’s founder Jen-hsun Huang expect that the interest in cryptocurrencies will continue within the foreseeable future.

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Regarding the company’s new calculation card for cryptocurrency in the CMP series, Nvidia expects to sell cards for USD 50 million during the first quarter of 2021. This is despite the fact that the cards were not announced until mid-February. At the same time, the company promises to report the CMP cards separately in future financial reports, which in the long run will lead to interesting statistics regarding the mining of cryptocurrencies.

Finally, Nvidia announces that the financial year 2022, the first quarter, or the initial quarter of 2021, is expected to touch the record quarter that has just been reported. Sales are once again expected to crack the five billion barrier calculated in USD – graphics cards intended for gaming are again expected to be cash cones.