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The value of the Nvidia share has fallen over the last few days, with a drop of 18% since Team Green published its latest financial results.
The overall results for Nvidia were really impressive despite the precipitous drop in the value of the stock. Record sales were attributed to Nvidia's sales of motor vehicles, data centers and workstations; enough for Nvidia to tell the shareholders that the dividends distributed would actually be 7% higher than the previous forecasts.
"Artificial intelligence is growing at an incredible pace around the world, generating record revenue for our data center platforms," he said. said Jensen Huang, CEO of Nvidia. "Our introduction of Turing GPUs is a giant leap in computer graphics and artificial intelligence, bringing the magic of real-time ray tracing to games and the greatest generational performance improvements ever made."
So why the big drop? Well, despite the good performances in various divisions, Huang said that this is the result of a correction that took place after the boom in cryptocurrency. The craze for crypto-mining has slowed down considerably and Nvidia is now sitting on a surplus stock of graphic material. Nvidia increased its holding inventory five times during this quarter.
Our short-term results reflect the surplus stocks of channels after the cryptocurrency boom, which will be corrected, " Huang said.
There are two kinds of damage on Nvidia. First, old stocks are still filling stores and stores and need to be moved. If we add to that, sales are expected to decline in the next quarter. Retailers do not need to order more inventory because they have already backed up enough after having ordered too much to meet cryptography demand.
Although this is a hypothesis, for now, it would not be too surprising that the demand for the GeForce RTX 20 series is not as important as for previous generation launches. The new graphics cards are prohibitively expensive, while reports point to defective RTX 2080 Ti and widespread disappointment with RTX ray tracing capabilities of GPUs, even in 1080p.
The end result is an Nvidia that looks worse than it has been for a while. While nothing approaches disastrous, but the value of shares fell 18.76% Friday, from $ 202 to $ 163. The value of Nvidia shares is now almost half of what it was at its peak of $ 289 in late September, just before the launch of the RTX 20 Series graphics card.
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