Graphics card specialist Nvidia has made changes to its performance guidance for this financial year.
The hardware firm says that it is expecting Q4 revenue to be $50m lower than originally anticipated, dropping from $2.7bn to $2.2bn. This is partly due to a weaker-than-predicated performance from its games division.
Nvidia says that there is too much "mid-range" stock in the retail channel, - meaning not its top-of-the-line RTX cards featuring the new Turing architecture - in the aftermath of the cryptocurrency boom. Stores and people who bought up large amounts of GPUs during the bitcoin-induced frenzy are now trying to flog stock after that craze came to an end.
China has played a part, too, with Nvidia saying that deteriorating economic conditions in this region, in particular, hitting it hard.
The firm's Datacenter business has also been weaker than anticipated.
“Q4 was an extraordinary, unusually turbulent, and disappointing quarter,” CEO and founder Jensen Huang (pictured) said.
“Looking forward, we are confident in our strategies and growth drivers.
“The foundation of our business is strong and more evident than ever – the accelerated computing model NVIDIA pioneered is the best path forward to serve the world’s insatiable computing needs. The markets we are creating – gaming, design, HPC, AI and autonomous vehicles – are important, growing and will be very large. We have excellent strategic positions in all of them."
Having too much old stock in the market is certainly a change - in March of last year, Huang bemoaned the fact that the GPU market wasn't close to meeting demand, in part thanks to the cryptocurrency boom, as well as people snapping up cards for machine learning.
In August 2018, the exec said that cryptocurrency would be "immaterial" to GPU revenue for the remainder of 2018. The end of the crypto boom - as well as excess stock in the pipeline - led Nvidia to miss its Q3 targets.
The firm has even partnered with Epic Games with the hope of free V-Bucks currency from Fortnite to help shift old cards. Given that Nvidia is still facing issues with excess stock, we'd presume this hasn't been as successful as the hardware specialist had hoped for.
This is likely an adjustment period for Nvidia as it comes down from the dizzying heights it experienced when people were snapping up powerful GPUs left and right to mine cryptocurrency but its next financial year will likely give a more balanced outlook now it's returning to business as usual.