Lower Demand on GPUs to Affect AMD

March 3, 2018

According to the annual Form 10-K report filled to SEC, AMD has became one of the few firms that managed to increase their profit on the sharply boosted demand on graphic processing units (GPUs) in 2017.

The filling states:

"We believe that the rise of cryptocurrency prices and introduction of new cryptocurrencies created a demand for our GPUs in 2017. The cryptocurrency market has existed for several years and their prices and popularity increased in 2017.  The mining operation of cryptocurrencies are typically performed using specifically designed application-specific integrated circuits (ASICs); however, the introduction of new cryptocurrencies (e.g. Ethereum) have made mining on GPUs more efficient, providing a higher rate of return for the end user."

However, the company understands that this state of the market will not last forever, and that the demand on GPUs will eventually decrease. AMD believes that the level of demand may also be affected by several kinds of restrictions, such as legislation restrictions in South Korea and China. However, the company claims to understand the importance of these issues and that it should cope with the rising risks, otherwise it's main competitor, Nvidia, may benefit on it and expand their market share.

Earlier in February, Nvidia CFO Colette Kress refused to reveal the exact share of the company's income in Q4 that came from cryptocurrency market and expressed her belief that cryptocurrencies will likely to remain volatile.

It is also worthy to recall, that earlier this month it was reported that cryptocurrency miners spent $776 million on GPUs in 2017.

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