Based on conservative estimates of gross margin of 75 percent and operating margin of 65 percent, the analysts calculate that Bitmain made $3 billion to $4 billion in operating profit in 2017. Bernstein's U.S. semiconductor team estimates Nvidia's operation profit was $3 billion during the same period.
"But Bitmain achieved this in merely four years, while it took Nvidia 24 years to get here," the Bernstein analysts said in a report published Wednesday.
Beijing-based Bitmain was founded by Jihan Wu and Micree Zhan in 2013. The company has since grown into one of the primary firms involved with bitcoin mining, the process of using computing power to generate bitcoins. Wu is also a widely followed figure in the bitcoin world.
Bitmain declined to comment for this story.
Bitmain generates its revenue from several parts (highlighted in gray) of the bitcoin mining supply chain