LAST UPDATE: 23.44
Chip maker Nvidia forecast lower-than-expected second-quarter revenue on Wednesday as the company expects problems with supply chain disruptions and a slowdown in demand for graphics chips used in gaming devices, according to Reuters.
The company’s share fell as much as 10% in online trading after Wall Street closed, having fallen about 40% this year, amid a sell-off in growth shares amid concerns about aggressive interest rate hikes.
The forecast includes an estimated $ 500 million reduction for Russia and coronavirus lockdowns in China, the company said.
Weaker graphics chip prices and lower spending on non-essential goods amid high inflation are likely to put pressure on Nvidia’s gaming business, experts say.
A drop in the cryptocurrency market could also hit the demand for graphics cards. Nvidia said it had a limited estimate of how much this would affect demand.
However, the demand from data center customers remains strong, as more and more companies are turning to the cloud and integrating artificial intelligence into their operations.
The company forecast second-quarter revenue of $ 8.10 billion, plus -2%. Analysts were expecting an average of $ 8.45 billion, according to Refinitiv.
Revenue for the first quarter, which ended May 1, rose 46 percent to $ 8.29 billion.
Source: Capital
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