Posted November 03, 2017 06:24:00Nvidia shares plunged to a three-week low on Tuesday after the company reported that it would be shutting down its cloud gaming division and selling its chips for $1 a piece.
But the stock’s decline was short-lived, and it rebounded slightly in Wednesday’s trading session.
The stock closed at $27.43 on Wednesday, down $3.25 or 3.2%.
It was down $1.36 or 0.8%.
Shares are down about 20% this year compared to last.
The decline was due in part to the fact that Nvidia’s cloud gaming business was ending, which means it was losing money on its bets on GPUs and graphics cards.
The company has struggled to keep up with the rapid growth in the demand for graphics cards in gaming, and Nvidia’s chips are becoming less profitable.
Nvidia, which is a part of chipmaker Nvidia, was once one of the biggest investors in the chip market, but its shares have fallen by more than 30% since the company went public in 2020.
That led to the company losing nearly $1 billion in value in the past decade.
In January, the company announced that it was selling its cloud game business, but it didn’t specify what it was doing with the proceeds.
The loss of revenue was blamed on the rapid increase in demand for GPUs, which were cheaper and faster to manufacture.
In addition, Nvidia has struggled with its pricing strategy for its GPUs, where it has spent a lot of money to make the chips more affordable.
The chips are now more expensive than they were a decade ago, and that has hurt Nvidia’s bottom line.
In a statement to TechCrunch, a Nvidia spokesperson said that the company was trying to stay profitable and would “reinforce our growth by delivering better performance on our cloud gaming customers.”