An analyst at RBC Capital Markets claims Nvidia made $1.95 billion in total revenue related to Bitcoin and crypto mining,” significantly more than Nvidia’s reported $602 million.
Mitch Stevens of RBC says from April 2017 to July 2018 Nvidia should have generated around $2.75 billion in revenue according to hashrate data for ethereum and other gpu mineable cryptos.
Another interesting fact that Stevens pointed out was that Nvidia accounts for 75% of the gpu mining market while AMD accounts for the remaining 25%. AMD is another popular stock that’s been doing well due to their Bitcoin and crypto revenues.
These are estimates based on his analysis of the company’s earnings reports according the Business Insider which says:
“AMD’s guidance implied it had crypto exposure of $234 million in the first quarter of 2018, which roughly matches the 25% of the total crypto revenue” Steves added.
It is not known what proportion of ethereum’s hashrate is asics, with some suggesting it is as low as 10% while some say it is as high as 60%.
There is however a potential correlation between ethereum’s hashrate and Nvidia’s stock price, although it is perhaps too early to determine the extent of it.
Below is an image of Ethereum’s hashrate mining over time.
We can see Nvidia’s price was up and up starting in 2016 with that little bump there in the 20s being somewhat similar to the little bump of eth’s hashrate (and price) in the same year.
Refer to the picture below to take a quick glance at NVidia’s stock price
Now of course there were a lot of things happening in October in the stock market. There was a mini-bear run throughout stock indices, so correlation doesn’t imply causation.
Yet the correlation is quite fine for it to be a mere coincidence, so there may have been some causation.
In 2017, the explosion of ethereum’s price sent gpus out of stock as people rushed to mine eth to mint new coins. Stock investors may have then allocated some of their funds to the manufacturers of gpus: Nvidia and AMD. Some correlation, therefore, is to be expected.
If gpu sales to miners is indeed close to $3 billion, then they may have quite a significant exposure to crypto prices and to industrial crypto mining.
Overall, we have been seeing companies shift away from the mining model due to the bear market we’re experiencing right now with crypto.