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NVIDIA announces net loss of $120 million for the quarter

by Scott Bicheno on 12 August 2008, 22:40

Tags: NVIDIA (NASDAQ:NVDA)

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Tough quarter

NVIDIA CEO Jen-Hsun Huang said "Our Q2 financial performance was disappointing," after announcing NVIDIA's first quarterly loss for six years.

Revenue was $892.7 million compared to $935.3 million for the same quarter last year, down five percent. That, combined with $196 million set aside to deal with problems associated with the weak die/packaging crisis, led to a net loss of $120.9 million.

The main reasons given for the lower revenue were basically a combination of AMD/ATI getting its act together and weak overall demand. NVIDIA conceded that its pricing prior to the launch of AMD's HD 4800 series was wrong and that it cost a fair bit to correct it to competitive levels. It also conceded that it took a while to clear 65nm inventory.

Accordingly all the underperformance was blamed on the desktop GPU division, which saw year-on-year revenues down 25 percent, unit sales down 20 percent and ASPs down 25 percent. Of course, the $196 million write off is apparently limited to the notebook division so there's blame to be attributed everywhere.

"The desktop PC market around the world weakened during the quarter. And our miscalculation of competitive price position further pressured our desktop GPU business," said Huang. "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."

 

Press release: NVIDIA Reports Results for Second Quarter of Fiscal 2009 and Announces Increase to Stock Repurchase Program



HEXUS Forums :: 4 Comments

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Wow, 4870x2 has had such a fast impact! :D
Doesn't sound like enough to cover all the laptop issues :p
Ouch.

What with the die issues of their mobile parts, the lack of any sort of x86 license, VERY limited use of SLI on Intel-chipsets and the whole physics thing (PhysX on NVIDIA's side and Intel and AMD wanting nothing to do with it and supporting Havok), you really wouldn't be investing any serious money in NVIDIA right now.

Their rosiest product from my point of view is the 9800GTX+ (ATI have everything else well and truly covered, yet that's still a viable alternative) and other than that, they're pretty much relying on the mobile market… something AMD are very much starting to eat into, especially with Dell's immediately popular range of Studio laptops.
If manafacturers see that AMD is the side to be on right now we might actually get a flood of PUMA laptops. Which is great for the laptop market :) As long as nvidia eventually fight back that is.. All the new 9 series mobile parts are the same as the old one's just run a bit cooler.