Nvidia’s earnings for the second quarter of 2024 exceeded expectations but failed to impress investors, leading to a decline in AI-related cryptocurrencies. Artificial Superintelligence Alliance (FET) dropped by approximately 7.8% to $1.1663 just hours after Nvidia’s earnings announcement. According to CoinMarketCap data, Bittensor (TAO) fell by 4.5% to $295.22, and Render (RNDR) decreased by 6.8% to $5.47.
Nvidia and AI Tokens
Nvidia’s revenue for the second quarter of 2024 reached $30 billion, a 15% increase from the first quarter and about $1.32 billion above previous forecasts. However, this was not enough. Market commentator Lisa Abramowicz shared the following in an X post on August 28:
“Being better than expected is not enough for Nvidia. Clearly, investors expect this company to exceed expectations.”
Some analysts predicted this would be at least 10% of Wall Street estimates. According to Google Finance data, Nvidia’s (NVDA) stock price closed at $125.61 on August 28 and has since fallen by an additional 6.89% in after-hours trading to $116.95.
The performance of AI crypto tokens has been closely linked to Nvidia’s performance and earnings reports in previous quarters. Some crypto market participants had predicted that AI crypto tokens would stumble following the earnings announcement.
Details on the Subject
Nvidia produces the chips used by companies to train and deploy AI models. After releasing its Q1 earnings in May, AI crypto tokens similarly fell despite a 18% increase in first-quarter revenue compared to the fourth quarter of 2023. Ed Ludlow from Bloomberg shared the following on August 28:
“The story remains intact. There is no demand issue here, and fundamentally, cloud computing providers operating data centers, which we call hyperscalers, continue to spend on Nvidia’s product.”
This came after the market value of AI and big data crypto projects and tokens increased by 79.7% in the three weeks following the selling pressure on August 5. Bitcoin fell below $50,000 for the first time since February. At that time, the total market value of AI and big data crypto projects fell to an annual low of $18.21 billion.
