The popularity of Nvidia’s chips made the US group a stock market darling. But currently its business with graphics cards is hit by a sharp downturn.

The chip group Nvidia does not expect a speedy recovery after failed sales expectations. For the current quarter, Nvidia forecast sales of around 5.9 billion dollars (around 5.9 billion euros) on Wednesday.

That would be over a billion dollars less than in the same quarter last year – and also significantly less than analysts expected. Revenue for the second quarter ended July was in line with the preliminary figures presented, up 3 percent to $6.7 billion. Nvidia itself originally expected more than eight billion dollars. The trigger for the development was a gaming business that was even weaker than expected. Nvidia’s graphics cards are not only used in PCs, whose sales are currently weakening, but also for the production of cryptocurrencies, which have become less lucrative as prices have fallen.

Gaming revenue of $2.04 billion fell a third year over year as announced. In the data center business, on the other hand, sales rose to 3.81 billion dollars – an increase of 61 percent. Among other things, technology from Nvidia is used across the board for applications based on artificial intelligence – and the US group also relies heavily on the car business as a supplier of computers for Mercedes, among others.

Bottom line, quarterly profit fell to $656 million from a good $2.37 billion a year earlier. In a telephone conference with analysts, company boss Jensen Huang said, among other things, that Nvidia was supplying significantly fewer graphics cards to the sales channels so that the traffic jam in the dealers’ warehouses would be reduced. This could go on for “a few quarters”. Nvidia posted a $1.22 billion inventory write-down amid reduced demand expectations.

At the same time, Nvidia must meet commitments to suppliers with which it has long-term agreements amid supply shortages in the early days of the coronavirus pandemic.

Investors dropped the stock by around 4.6 percent in after-hours trading. The course rose sharply last year to as much as $330 in November. After that, a downturn set in and most recently it was at a good $ 160 at the level of May 2021.