AMD and Nvidia Disagree on Future Impact of Crypto-Mining

Investing.com - AMD and Nvidia both manufacture chips that help power the data centers mining Bitcoin, Ethereum, and other cryptocurrencies. However, they differ in their visions for the future. AMD seems to think that despite a year in which Bitcoin prices have grown more than 800% and Ethereum has gained 3,500%, demand for crypto-mining will fade. During the Q2 earnings call back in July, AMD CEO Lisa Su said they weren’t looking at cryptocurrency as a long term growth driver. She continued that train of thought after Q3 earnings last week, saying, “there will be some leveling off of some of the cryptocurrency demand.” Meanwhile, Nvidia, whose shares have risen during this time are up close to 95% year-to-date , has sounded more positive. In August, Nvidia CEO Jensen Huang said the market for graphics cards in cryptocurrency would grow quite large and that they “have the ability to rock and roll with this market as it goes.” This week, Morgan Stanley (NYSE:MS) downgraded AMD to underweight, and said that they expect sales of crypto-mining chips to “meaningfully decelerate next year.” AMD shares have tumbled about 25% in recent days. It will be interesting to see if Nvidia will stay as optimistic about crypto-mining when they report earnings on November 9th. A bleak outlook could pull Nvidia down from its newly reached all time high.