Graphics card giant Nvidia has seen its revenue take a dive year-on-year due to "challenging market conditions".
Speaking on the company's Q2 shareholder call - transcribed by Motley Fool - chief financial officer and EVP Colette Kress said that the company had seen a 19 per cent decline in revenue quarter-to-quarter. That clocks in at $6.7 billion, well below the $8.1 billion that Nvidia had forecast, though it is still a three per cent increase year-on-year.
Kress says that this is largely driven by the company's games business which was softer than usual. This arm of Nvidia brought in $2.04 billion for the quarter, a 44 per cent increase on Q1, and a 33 per cent decline year-on-year.
This decrease is something that Nvidia had predicted due to the war in Ukraine and China's continued COVID lockdowns.
"The decline in Gaming GPU revenue was sharper than anticipated driven by both lower units and lower ASPs," Kress said.
"Macroeconomic headwinds across the world drove a sudden slowdown in consumer demand. We implemented programs with our Gaming channel partners to adjust pricing in the channel and to price-position current high-end desktop GPUs as we prepare for a new architecture launch."
The decline in graphics card sales could be due to the decline of the crypto market. The bubble had already somewhat burst for this sector, but this has accelerated due to rising energy costs making crypto mining much more expensive.
"As noted last quarter, we had expected cryptocurrency money to make a diminishing contribution to Gaming demand," Kress continued.
"We are unable to accurately quantify the extent to which reduced crypto money contributed to the decline in Gaming demand. While Gaming navigates significant short-term macroeconomic challenges, we believe the long-term fundamentals in Gaming remain strong. NVIDIA RTX has redefined computer graphics and is now supported by almost 300 games and applications. NVIDIA's GeForce GPUs are the most coveted brand by gamers, representing 15 of the top 15 most popular GPUs on Steam."