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On Monday, Nvidia made the unusual decision to offer a revised financial estimate for the fourth quarter of 2019 before its planned release on February 14. The reason: Nvidia had already forecast low revenues, and the hardware maker is already convinced that its low estimate was again too high.
The initial estimate of quarterly revenues of $ 2.7 billion fell to $ 2.2 billion, a variation of about 19%. Some new data points are taken into account in this revision. According to Nvidia, the main problem faced by consumers is the "lower than expected" sales of its range of new RTX graphics cards. This series, which abounds with proprietary technologies, such as a dedicated ray tracing processor, was launched in September 2018 with the RTX 2080 Ti at $ 1,199 and the RTX 2080 at $ 799.
"These products offer a breakthrough in terms of performance and innovation with ray tracing and AI in real time, but some customers may have delayed their purchase while waiting for lower prices and more. Other demonstrations of RTX technology in real games, "said Nvidia in a statement. At the time of the press, only one retail game, Battlefield V, has tapped into the RTX ray casting system only.
Nvidia's work on server-side and data-center technologies also seems to be part of the revised estimate. In a letter to shareholders, Nvidia's chairman, Jensen Huang, highlighted the "economic uncertainties" and "a number of transactions [that] It did not close in the last month of the quarter, as it believes that the reduced estimates in a sector it admits are already unpredictable by default. Huang cited a "slowing down" global economy, especially in China.
These pitfalls added to a factor already recognized by Nvidia as a factor in reducing revenues: a dip in the demand for cryptocurrency and, as a result, a drop in sales of mining companies eager for cryptocurrency. This "surplus mid-range channel inventory" was in line with Nvidia's expectations, the statement said.
Huang went so far as to qualify the Q4 2019 as "extraordinary, unusually turbulent and disappointing quarter," although he did so after listing a number of initiatives that, at his notice, will generate additional revenue, including: the launch of the $ 349 RTX 2060 graphics card; a new wave of RTX – powered notebooks, which combine more and more user – friendly products for corporate mobiles with more RTX benefits; and enhanced features for its data center products, including "In-depth learning inference, data badysis, and machine learning," to satisfy more customers and more. Company eager for AI.
This revision comes before the launch by the AMD competition of the general public RGP, the Radeon VII, a 7nm graphics card that will be available in stores on February 7 at a price of $ 699.
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