(Bloomberg) -- Nvidia Corp. said chip inventory built up in anticipation of cryptocurrency mining demand that fizzled is expected to be cleared out in the current quarter. The company also maintained its optimistic forecast for fiscal 2020.
Nvidia is still working through the stockpile of unsold parts, but remains confident it's on track to complete that effort as previously predicted, Chief Financial Officer Colette Kress told analysts and investors Tuesday at a company event in San Jose, California. The chipmaker is sticking by an outlook of revenue that will be flat or slightly down from last year for fiscal 2020. That forecast compares with an average analyst estimate of a 4 percent decline.
Chief Executive Officer Jensen Huang is trying to convince Wall Street that his company's revenue will quickly improve upon a three-year surge once built-up inventory is used by its customers. Nvidia is the largest maker of semiconductors that generate the realistic images sought by computer gamers.
Sales of chips to cryptocurrency miners crashed last year when the digital-coin market plunged, hurting the company's performance. The resulting excess inventory has been compounded by weaker demand from consumers and data-center operators, who had been using the chips for artificial intelligence computing.
Nvidia's shares gained 4.8 percent to $177.02 at 2:30 p.m. in New York and had increased 27 percent this year through Monday's close.
To contact the reporter on this story: Ian King in San Francisco at ianking@bloomberg.net
To contact the editors responsible for this story: Jillian Ward at jward56@bloomberg.net, Andrew Pollack, Molly Schuetz
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