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Nvidia misses on revenue in Q3, dragging the rest of the chip sector down with it

The chipmaker continued to combat the decline in the sales of cryptocurrency mining products

Nvidia chip
Shares of Intel, Micron, Applied Materials and Advanced Micro Devices also fell

Chipmaker Nvidia Corp (NASDAQ:NVDA) missed on revenue in its third quarter, offering weak guidance for the fourth quarter as sales of its cryptocurrency mining products continue to struggle.

The semiconductor company reported earnings of $1.84 per share, ahead of analysts' estimates of $1.71 per share. Revenue came in at $3.18 billion, falling below expectations of $3.24 billion.

Shares slipped more than 18% to $165.68 in Friday pre-market trading.

"Our near-term results reflect excess channel inventory post the crypto-currency boom, which will be corrected," said CEO Jensen Huang in the company’s press release.

READ: Super Micro Computer reports higher 1Q fiscal revenue and earnings amid Chinese spying controversy

The company is expecting fourth-quarter revenue of $2.7 billion, lower than the $3.4 billion analysts had hoped to see.

Oppenheimer analysts noted that the crypto “hangover” may be pushing the debut of Nvidia’s Turing RTX cards to the sidelines.

The Turing RTX is Nvidia’s latest graphics processing unit, which can process graphics six times faster than its previous Pascal version.

Gaming business revenue totaled $1.76 billion, below the $1.89 billion consensus estimate.

“As the pipeline of games utilizing ray-tracing ramps beginning this quarter, we expect performance improvements greater than 2x. We see the performance PC gaming and visual effects TAM at $250B,” wrote Oppenheimer analysts.

As Nvidia’s shares plunged, it took the rest of the chip sector down with it.

Applied Materials Inc (NASDAQ:AMAT) shares sank about 10% to $31.68.

Micron Technology Inc shares were down nearly 4% to $38.44.

Shares of Advanced Micro Devices Inc (NASDAQ:AMD) fell 7% to $20.

Intel Corp (NASDAQ:INTC) shares dipped about 1.5% to $47.40.


Contact Lenore Fedow at [email protected]

Follow her on Twitter@LenoreMariee

Quick facts: NVIDIA Corporation

Price: 449.11 USD

Market: NASDAQ
Market Cap: $276.2 billion

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