Nvidia profit forecast drops as customers wait ‘for lower price points,’ says CEO

Nvidia‘s profit forecast for the fourth quarter of its financial year has been reduced pretty significantly as the company looks set to lose out on new tech. The Nvidia profit forecast has dropped from a projected earning of $2.7 billion down to $2.2 billion, which might not seem like much, but it could mark the first signpost for the drop in the games industry revenue that Pelham Smithers predicted last week.

Much like Smithers suggested, Nvidia has put some of the reason its projections have dropped down to the recent activities in China. While Smithers argued that the freeze on new games in China would force a revenue drop, Nvidia says that “deteriorating economic conditioning in China” have affected the sales expectations for its range of gaming GPUs.

The revised number is also a consequence of Nvidia’s new tech lineup, specifically the systems using Nvidia’s new Turing setup. Company CEO Jensen Huang said that consumers were “waiting for lower price points and further demonstrations of RTX technology in actual games.” The sentiment is close to echoing Smithers’ analysis of the industry, where he claimed that the gap in next-gen consoles could mean that we don’t see a rise in the games industry until 2021. Huang’s estimation isn’t quite so dire (you’d expect that from a CEO though), but it’s a conclusion that’s had a pretty major impact on Nvidia’s earnings, and with a major price cut to the top-range tech they have in stock seeming pretty unlikely, it’s something that Nvidia may have to deal with beyond this financial year.

Huang remains optimistic for the company though, saying that looking “forward, we are confident in our strategies and growth drivers.” Though it could be something that’s out of the company’s control, Apple reportedly revised their financial expectations for the final quarter of the financial year as well, meaning it could very well be a natural dip we’re seeing in the tech industry.

(Via Tom’s Hardware)