Nvidia and AMD Might Not Be Riding the Cryptocurrency Mining Wave for Much Longer Chipmakers Nvidia Corp. (NVDA) and Advanced Micro Devices Inc. (AMD) benefited from a cryptocurrency boom in June, but Wall Street is warning that the mining wave could run out of steam soon. Since the beginning of June, shares of AMD have gained 23.5%, while Nvidia has risen almost 14%, on the back of a surge in demand for GPUs used to mine an alternative cryptocurrency called Ethereum (the units are known as Ether). A wave of bullish reports have come out since then saying that the boost in cryptocurrency mining demand could help Nvidia and AMD rise above a seasonally weaker fiscal second quarter, among other benefits. But thanks to a steep drop in the prices of cryptocurrencies, the benefits may already be priced into the current quarter, with little left to gain thereafter, according to analysts. Nvidia's stock was up 0.1% to $164.44 on Tuesday, while AMD shares fell 3.9% to $13.27. Some analysts are beginning to question the sustainability of the cryptocurrency mining boom. In a note to clients on Tuesday, BMO Capital Markets analyst Ambrish Srivastava wrote that he's "not at all bullish" on the sudden surge in demand for GPU cards from cryptocurrency mining. Additionally, Barclays analyst Blayne Curtis downgraded AMD's stock to Underweight from Equal Weight, saying he's"unconvinced" AMD will generate enough revenue to support its lofty valuation. "Bottom line, we are not at all bullish on the sudden surge on demand for GPU cards from cryptocurrency mining," Srivastava said. "We see a fair bit of similarities to what happened in 2013/2014, which was a more than one-quarter bust for AMD, after the boom in cryptocurrency mining." Srivastava was referring to 2013 when a steep run-up in Bitcoin prices led to a shortage of AMD GPUs, only for bitcoin to shed 80% of its value in just 13 months. The price of Ether exploded last month, hitting an all-time high of more than $400 on June 12. Since then, it has crashed 65% to a low of roughly $130 on Sunday, before rebounding 24% higher to $170 on Monday. AMD and Nvidia are tied to Ether because they manufacture the graphics processors used to mine the cryptocurrency. The chip giants aren't connected to Ether's more popular crypto cousin, Bitcoin, however. That's because the algorithm for mining Bitcoins has become too complicated for desktop graphics chips, causing miners to switch to custom designed ASICs (application-specific integrated circuit) chips that are powerful enough to run the mining programs.
Interesting article about how Fujitsu is making a chip 10X faster than AMD's cash cow. https://seekingalpha.com/article/4096027-amd-revenue-expectations-diminish If this is true, AMD is going to the $11's. Tough biz.
Not 11 yet... but it's creeping down there... it looks like it's at a support line now though. Buy some now and if it drops, buy until 10... then load up... all-in... put your balls on the block baby....
The emerging Intel bug is a huge deal. http://www.techradar.com/news/patch...ntel-cpus-could-potentially-slow-down-your-pc
just my $0.02. Crypto mining is factor for their stock. But i don't think it's that much of a deal. The bigger thing will be announcements for the next video games consoles contracts. Remember that their stock got big spikes up when they became exclusive silicone vendor for sony and microsoft. And right now those two companies are pushing their RnD with AMD's technicians. It will be like a year from now one when we will get public announcement. Then we will see if they secure deals. Their stock will sky rocket. I think i can hold on their stock.
A close below 9.70 will get me to short it. That is a significant price floor, and it can plummet to the low 8's from there in a relatively speedy fashion.
Any thoughts if it's worth holding or not? If AMD can prove that they can really steal market share from its competitors (Intel..) there's still room to go up, I guess. Once (IF?) they become a real alternative when it comes to PCs, servers or notebooks who knows how far it may go up. Thanks.
Don't know if I'll hold through next earnings... Their processor lineup is the bees 's knees right now, but crypto is done for on GPUs in the mean time. AMD did not seem to be affected as much by crypto so feels like their rally must be processor sales. In any case XILINX and Intel will dominate crypto FPGA mining in the foreseeable, and they'll need memory regardless (think micron, Samsung, hynix, elpidia)..... Until bitmain goes public.