GMO CryptoChip Profitable, but Not Growing
Japanese internet giant GMO posted its third quarter results for FY2018. Its net sales from the cryptocurrency business showed no growth as compared to last year during the same period. The good news is that the crypto-related business brought in $300,000 in earnings over the same quarter in 2017.
In June this year, the company developed CryptoChips, a Mobile App that rewards players in virtual currency. The Japanese technology firm stated that the players use the Mobile App CryptoChips for earning rewards in digital currency and for that all they have to do is play games. The company integrated the Mobile App with Whimsical War, a territorial battle, a real-time game from the GMO Group.
The Japanese technology giant registered record highs in net sales, ordinary profits and operating profits. The overview shows overall net sales of 22%, gross profit of 24.5%, ordinary profit of 40.3% and operating profit of 44.4%. However, the net sales of GMO indicate that the virtual currency made revenues around $23 million. This figure represents no growth when compared to Q3 2017.
However, it indicates a rise in total net sales percentage elevating from 5.5% to 5.7%. Instead of taking it as a negative result, market analysts believe that stability is a good sign due to the market’s current bearish stance. The Q3 net sales is 2 billion Yen more than GMO’s FY2018 and 1.7 billion more than Q42017. The company recorded an overall profit of $880,000 from virtual currencies in Q32018.
The company’s crypto segment could not increase the profit rate. Even then GMO is proud its crypto division at least maintained the profit rate in the current market conditions. GMO boasts of a wide mining operations network offering a hash rate of 674 Petahash/second (PH/s). This represents a rise from the quarter. Profit from mining operations substantially declined in the second and the third quarter as the market conditions are highly unfavorable.
The Japanese technology giant is not the only company feeling the brunt of unprofitable mining. According to a research, the virtual currency miners made a turnover of $4.7 billion in 2018 but still made profit. At the start of this year, Genesis Mining, a cloud mining firm started ending contracts with its mining customers because it could not operate as a sustainable business model.