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NVIDIA meets expectations for Q3, says it has turned the corner

by Scott Bicheno on 12 November 2010, 12:26

Tags: NVIDIA (NASDAQ:NVDA)

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Playing patience

Graphics chip maker NVIDIA has had to regularly call on the patience of its investors this year. Back at CES in January, and then at MWC a month later, NVIDIA stressed how well positioned it is, thanks to its Tegra 2 SoC, to capitalise on the impending tablet market.

Ten months later we have yet to see any of these Tegra 2-based tablets, and investors must be wondering where these tablets that NVIDIA has supposedly bet the farm on are. Tellingly, CEO Jen-Hsun Huang dwelt at length on the matter in his comments accompanying the announcement of NVIDIA's Q3 financial results.

To address the apparent delay in Tegra 2 Android tablets, Huang stressed to CNET that they shouldn't be rushed. "You can't just do another product," he said, in reference to competing with the Apple iPad. "Look at the Samsung Galaxy Tab. It's a tablet that uses a phone operating system on a large display. A tablet is not a large phone."

Leaving aside the matter of the iPad being a devices that uses a phone operating system on a large display, Huang has a good point. Android is not currently optimised for tablets and it will be difficult to claim an Android tablet is superior to the iPad until it is. Especially if it's not even price competitive.

Huang says we should finally see some end-product at the beginning of next year, and we expect a degree of déjà vu from the graphics outfit at next year's CES and MWC. But NVIDIA is in the hands of the OEMs and, ultimately, Google, so Huang will have his fingers crossed that they get a move on.

NVIDIA's Q3 results were pretty much consistent with expectations and, accordingly, its share price hasn't moved that much. Although, having said that, it was seeing some positive activity in pre-market trading at time of writing. It announced earnings of $843.9 million, and forecast a Q4 slightly ahead of expectations.

"We have turned the corner," said Huang, in the corresponding press release. "We have restored our speed of execution and are regaining share in desktops. Only seven months after shipping our first processor based on the Fermi architecture, we have begun production on seven more GPUs, including the GeForce GTX 580, which sets a new standard for performance. The Fermi architecture is now in every segment of our desktop, notebook and workstation product lines.

"We've also made big strides this quarter in positioning ourselves at the center of cloud and mobile computing, which are transforming the computer landscape. Tesla now powers some of the world's fastest and greenest supercomputers. And Tegra will soon be featured in a range of smartphones and tablets we're building with our partners."

 



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