Crypto bust but video card makers still trying to keep gross margins high

Posted on Wednesday, June 20 2018 @ 11:17 CEST by Thomas De Maesschalck
The collapse of the cryptocurrency market as well as the arrival of new ASIC mining solutions resulted in a doubly whammy for the video card mining market. Mining farms are no longer ordering video cards in massive volumes and this is resulting in a lot less shipments. This is good for gamers of course, as it's once again possible to buy a video card at a more normal price, but the situation still hasn't fully normalized.

DigiTimes points out that Asustek, MSI, Gigabyte and TUL have seen their inventories spike significantly due to the lower demand from the mining segment. However, the video card makers are still refusing to cut prices to normal levels. Their gross margins are currently around 20 percent, which is lower than the previous high of 40-50 percent, but it's still a lot higher than the level of 8-10 percent seen in early 2017.

Industry sources believe cryptocurrency mining will have dim prospects in the second half of this year. It's going to be interesting how this will affect the financial figures of both AMD and NVIDIA. Both companies tried to downplay the importance of crypto mining but we're soon going to learn how large the impact really is or was.

About the Author

Thomas De Maesschalck

Thomas has been messing with computer since early childhood and firmly believes the Internet is the best thing since sliced bread. Enjoys playing with new tech, is fascinated by science, and passionate about financial markets. When not behind a computer, he can be found with running shoes on or lifting heavy weights in the weight room.

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