Going off the boil
Graphics giant NVIDIA has its analyst day yesterday, and it rolled out the big guns, including CEO Jen-Hsun Huang and Tegra boss Mike Rayfield. There was much bullish talk about the prospects for Tegra, especially, but it appears the market wanted more, as NVIDIA shares fell by a further 4.5 percent yesterday.
It doesn't look like NVIDIA did anything wrong, from the account of the day on Forbes, but neither did it do enough right. This is partly the fault of scheduling its analyst day immediately after CES and MWC, where NVIDIA completely revealed its hand for the year. To extend the metaphor, it had no cards left up its sleeve for the analysts.
Another consequence of playing all your wild-cards early is that the initial spike in share price fuelled by all this hype and bombast then has to be supported. This can only be done by maintaining that level of big announcements and, it seems, failure to do so leads to a rapid retreat from equity highs.
Of course, as we've extensively discussed on this site and mobile-device.biz, NVIDIA is intimately associated with Honeycomb (Android 3.0) tablets right now, due to Tegra 2 being the default chip for the first wave of products. For some reason general optimism about Honeycomb tablets flipped to pessimism after Apple delivered the minimum of what was expected of it with the iPad 2. This pessimism has been passed directly onto NVIDIA.
So onto the analyst day, Huang and co mainly recapped what we heard from them at the two big tech shows. Huang was keen to emphasise how the market opportunity for NVIDIA, thanks to Tegra and announcements like Windows for ARM and Project Denver, is six times bigger now than in the past.
But the tablet question unavoidable. Huang insisted that Motorola's Xoom - the flagship Honeycomb device - and the Apple iPad have very different specs and are not really comparable. He couldn't resist stressing that he can't imagine any computing device that doesn't multi-task, however.
Rayfield talked-up Kal-El again, and included it among three key ‘inflection points' for the year; the others being how Tegra 2 phones do in the first half of this year and how Honeycomb tablets do as they continue to appear on the market over the course of the entire year.
Finally CFO David White was keen to stress that almost all of the historically high level of R&D spend is on mobile, HPC and the Denver CPU strategy. He conceded the point that the size of NVIDIA's tablet business is dependent on what share Android can grab from Apple and what share of that business NVIDIA can keep. Says it all, really.