Chipmakers and GPU manufacturers noticed a major spike in their profits over the past couple of years as cryptocurrency mining peaked. However, over the course of 2018, as the mining-frenzy is fizzling out, a dip in these earnings has been noticed. AMD has become the latest name to be affected by this decline in the consumer interest. AMD has stated in their earnings call that the revenue from blockchain-related GPU sales was almost ‘negligible’. 

AMD’s shares fell by 25% over the past 24 hours as the company didn’t perform as per the market expectations. Moreover, following the Q3 results, the company has lowered their expectations for Q4 as well. However, the picture isn’t as bad as it seems to be because AMD’s Q3 2018 revenues have shown an improvement of 4% as compared to the same quarter last year. 

AMD CEO Lisa Su commented during the company's earnings release:

"We delivered our fifth straight quarter of year-over-year revenue and net income growth driven largely by the accelerated adoption of our Ryzen, EPYC and datacenter graphics products. Client and server processor sales increased significantly although graphics channel sales were lower in the quarter."

The company’s revenues from computing and graphics division stood at $938 million, which is a 13% decline compared to Q2 2018. The forecast for the rest of the year is weaker than expected, as AMD has predicted a revenue of $1.45 Billion, as opposed to the market expectations of $1.6 Billion. However, despite the ups and downs of this quarter, the company has shown a 120% rise in profits over the course of the year. 

However, this decline in the sale of cryptocurrency-related hardware devices should worry AMD and other similar firms such as nvidia. One of the biggest reasons why the profits had been surging for these firms is because of the rise in demands for GPUs due to the rise in popularity of cryptocurrency mining using GPUs. However, with the profits in cryptocurrency mining declining, miners have stopped buying new GPUs and some of them have stopped mining altogether. 

In addition to mining not being so lucrative anymore, another reason for the fall of GPU sales could be attributed to the fact that the likes of Ethereum and ZCash can now be mined using ASIC devices - a possibility which didn’t exist till recently. Bitmain has managed to break through the Ethash algorithm, following which it is now possible to mine for Ethereum using ASIC devices - which are much more powerful and faster than compared to GPUs. 

This decline in earning doesn’t really come as a surprise for anyone who was following the markets. The company had stated during an earnings call in July this year that they do not expect much from the blockchain sales in the second half of the year. AMD had apprehended this earlier in the year that their earnings might be affected due to instability in the cryptocurrency markets. 

Stay tuned with us at Cryptoground for the latest updates from the world of cryptocurrencies and the blockchain technology!