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Nvidia initially expects game sales to drop due to switch to new architecture

Nvidia initially expects game sales to drop due to switch to new architecture

of Maximilian Hohm
Despite record sales in the last quarter, Nvidia expects sales to fall in the next quarter. The company cites the current Ukraine crisis, lockdowns in China, and uncertainties in selling to miners and gamers shortly before the new generation as reasons. Read more about this below.

Nvidia presented the key business figures for the first quarter of 2022 in its latest earnings call. The California company has made a record turnover of 8.29 billion US dollars. This represents an increase of 46% compared to 2021 and 8% compared to the previous quarter. For the first time in company history, data center revenue exceeded revenue from the sale of gaming graphics cards.

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Nvidia reduced profit to approximately $1.6 billion from prior quarters, reflecting a high spending of $3.5 billion in the latest quarter. However, since $2.1 billion was used to buy back shares and pay dividends to shareholders, there is no need to worry. For the upcoming quarter, the company anticipates lower sales of approximately $8.1 billion. The reasons for this are the blockades in China, which restrict or make production more expensive, and the cessation of commercial relations with Russia. Combined, these problems are said to be responsible for $500 million less in sales than originally anticipated.

Also, there is less demand from the EU, China, and the US, which could be partly due to crypto miners and partly due to the upcoming new generation of graphics cards. According to his own statement, Nvidia is currently unable to estimate the respective effects of this, but is still expecting a good second quarter. In the third quarter, however, the tide should turn again due to new graphics cards and a new sales and earnings record seems possible.

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