Press release
SANTA CLARA, Calif., Aug 12, 2008 /PRNewswire-FirstCall via COMTEX News Network/ -- NVIDIA Corporation (Nasdaq: NVDA) today reported financial results for the second quarter of fiscal 2009 ended July 27, 2008.
For the second quarter of fiscal 2009, revenue decreased to $892.7 million compared to $935.3 million for the second quarter of fiscal 2008, a decrease of five percent. For the six months ended July 27, 2008, revenue increased to $2.05 billion compared to $1.78 billion for the six months ended July 29, 2007, an increase of 15 percent.
During the second quarter of fiscal 2009, NVIDIA recorded a $196 million charge against cost of revenue to cover anticipated customer warranty, repair, return, replacement and associated costs arising from a weak die/packaging material set in certain versions of our previous generation MCP and GPU products used in notebook systems.
NVIDIA's results for the second quarter of fiscal 2009, computed in accordance with U.S. generally accepted accounting principles (GAAP), included a net loss of $120.9 million, or a loss of $0.22 per share. Non-GAAP net income for the second quarter of fiscal 2009, which excludes stock-based compensation charges, the non-recurring warranty charge against cost of revenue, and the associated tax impact, was $74.5 million, or $0.13 per diluted share.
GAAP net income for the six months ended July 27, 2008 was $55.9 million, or $0.09 per diluted share, compared to $305.0 million, or $0.51 per diluted share, for the six months ended July 29, 2007. Non-GAAP net income for the six months ended July 27, 2008, which excludes stock-based compensation charges, the non-recurring warranty charge against cost of revenue, and the associated tax impact, was $286.2 million, or $0.49 per diluted share, compared to $362.5 million, or $0.62 per diluted share, for the six months ended July 29, 2007.
"Our Q2 financial performance was disappointing. The desktop PC market around the world weakened during the quarter. And our miscalculation of competitive price position further pressured our desktop GPU business. We have a great product line-up and, having taken the necessary pricing actions, we are strongly positioned again. Our focus now is to drive cost improvements and to further enhance our competitiveness through the many exciting initiatives we have planned for the rest of the year," said Jen-Hsun Huang, president and CEO of NVIDIA. "In contrast, the rest of our businesses did not exhibit the same dynamics as our desktop business. The notebook GPU, MCP, and Professional Solutions groups grew a combined 27 percent year-over year."
Mr. Huang added, "Though we approach the near term with caution, we remain very optimistic about the expanding universe of visual computing and the exciting growth opportunities made possible by CUDA, our general purpose parallel computing architecture."
NVIDIA also announced an increase of $1 billion to its stock repurchase program under which it may now purchase up to $2.7 billion of its common stock. Through July 27, 2008, NVIDIA has repurchased 68.0 million shares under the stock repurchase program for a total cost of $1.16 billion.
The repurchases will be made in the open market, in privately negotiated transactions, or in structured share repurchase programs, and may be made from time to time or in one or more larger repurchases. The program will be conducted in compliance with the Securities and Exchange Commission's Rule 10b-18 and applicable legal requirements and shall be subject to market conditions and other factors.
The program does not obligate NVIDIA to acquire any particular amount of common stock and the program may be modified or suspended at any time at the Company's discretion. The purchases will be funded from available working capital.
