The Demand for Cryptocurrency Mining May be Slowing Down

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The large graphics card manufacturer AMD has reported a large jump in sales over the course of 2017 due to a large amount of demand.

On Tuesday, the 24th of October, the company reported that they earned upwards of $819 million in revenues from their computing and graphics division alone. This represents a large increase of 74{7b1a8a58d3ffe2d8e535e80e794d8bc0bf06a3ecc0c2050b83ca37784c6fddca} for the prior years third quarter.

The company attributes the increase partly to the rise in cryptocurrency mining. AMD manufactures graphics processing units or GPU’s that are used in high-powered computers for mining cryptocurrency. AMD stated that the gain in revenue is “primarily driven,” by a large amount of sales of the Radeon GPU as well as the Ryzen desktop processors. These two units are employed in the mining of cryptocurrency. The products that they manufacture have shot up in sales over the past few months, partly due to their advancement over other manufacturers of similar products.

Although the company has slow growth in other sectors of their business, the GPU sector has been responsible for 26{7b1a8a58d3ffe2d8e535e80e794d8bc0bf06a3ecc0c2050b83ca37784c6fddca} year-on-year increase in revenue to a high amount of $1.64 billion. This means that this current quarter is the highest-grossing one since 2011.

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The numbers are quite staggering, but majority shareholders in the company are not fully impressed by the third quarter results. After this release, AMD shares dipped by 12{7b1a8a58d3ffe2d8e535e80e794d8bc0bf06a3ecc0c2050b83ca37784c6fddca} from $14.25 on Tuesday, October 24th, to a low of $12.43 during after hours trading.

The CEO of the company, Lisa Su recently released a statement that “in terms of the headwinds… we’re also predicting that there will be some leveling-off of some of the cryptocurrency demand.”

The demand for cryptocurrency is continuously rising which will likely be linked to an increase in stock price as time goes on.

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