Crypto Market Not in Good Shape Following Nvidia Earnings Report

The AI ​​and semiconductor giant reported its second-quarter results on August 28, reporting an increase in net profit to $16.6 billion.

The tech giant reported revenue of $30 billion, up 122% from the same period last year and up 15% from the previous quarter.

The strong earnings report could boost the fast-growing artificial intelligence sector and have a knock-on effect on crypto assets, though there are no signs of this happening yet.

Nvidia profit beats expectations

The company beat Wall Street expectations with a sharp increase in profits, but investors were not impressed as the company's shares plunged about 8% in after-hours trading, dropping NVDA to around $117.

Despite the revenue growth, “it seems like the bar was set a little too high this quarter,” Ryan Detrick, chief market strategist at Carson Group, told The Associated Press.

“This time around, the overshoot is much smaller than we've seen in the past. Future guidance was also raised, but again, less than in the previous quarter.”

On an earnings call with investors, Nvidia founder and CEO Jensen Huang said, “People who invest in Nvidia infrastructure are seeing immediate benefits,” adding, “This is the highest ROI infrastructure, computing infrastructure investment you can make today.”

The company's Chief Financial Officer, Colette Kress, attributed the growth to GPU sales and expectations for the company's new Blackwell chips.

Nvidia has become the market leader in AI and is now valued at more than $3 trillion as demand for generative AI products has boosted sales of the company's specialized processors.

Crypto is acting as if someone leaked NVIDIA's revenues.

— Adam Cochran (adamscochran.eth) (@adamscochran) August 27, 2024

Cryptocurrency Market Outlook

The artificial intelligence-based token has been on a strong run recently, leading to a much-anticipated earnings report.

AI tokens such as Near Protocol (NEAR), Alliance for Artificial Superintelligence (FET), Bittensor (TAO), and RENDER (RENDER) have outperformed the overall cryptocurrency market over the past week or so.

Despite this, the cryptocurrency market has crashed hard this week, shedding roughly $200 billion in total market capitalization since the weekend.

Bitcoin led the decline, dropping to $58,000 on Aug. 27. As the market cooled, AI-based altcoins followed suit.

With Nvidia’s earnings report behind us, investors are now looking to September and a cut in U.S. interest rates as a possible catalyst for the cryptocurrency market.