At Nvidia’s annual analysts day CEO Jen-Hsun Huang said that he thinks that the company’s mobile Tegra processor business will be “flat” this year. The main reason for this downbeat assessment is that the popularity of Qualcomm’s LTE integration in its SoC offerings caught competitors, including Nvidia, off-guard. Reuters reports that Nvidia’s shares fell as much as four per cent after the CEO’s predictions, however the company later announced a $1 billion share buy-back scheme which has brought the shares back up to their opening price.
Nvidia has reacted to the LTE equipped competition’s popularity by pushing back the launch of its Tegra 4 chips in order to use the resources to prepare the Tegra 4i, with integrated LTE, more quickly. The decision has delayed the introduction of Tegra 4 chips by a quarter, but on the other hand Tegra 4i development has been brought nearer to completion by nearly half a year, according to CEO Huang.
At the investor presentation the Nvidia CEO said “The LTE marketplace is growing faster than any transition that has happened in wireless. It was important for us to engage that marketplace as quickly as possible. We decided we'd sacrifice the schedule of Tegra 4 by a quarter so we could pull in Tegra 4i by more than two.” He concluded, firmly “That was a good decision.”
Looking at the situation in the coming year Huang projected “We're confident that as we go into the second half, growth will return. How do we feel about the Tegra business? … This year Tegra will be about flat.”
Just over a week ago we learned that the next generation Google Nexus 7 tablet, arriving in July, was going to be powered by a Qualcomm Snapdragon SoC. The sources at the time said the Qualcomm processor was chosen “for power reasons”, but perhaps Google want an LTE option. Nvidia reportedly supplied six million Tegra 3 chips to ASUS for production of the current Nexus 7 tablet model, that’s 60 per cent of all Tegra 3 SoC sales. So the Qualcomm win would have definitely hurt Nvidia.
Samsung is also readying an LTE equipped version of the Exynos 5 Octa SoC. The Android Headlines website reckons it will debut in the Samsung Galaxy Note 3 phablet.
