Nvidia posts $201.3 million loss

Written by Ben Hardwidge

May 8, 2009 | 15:45

Tags: #2009 #2010 #first #fiscal #gpgpu #huang #jen-hsun #loss #q1 #quarter #tegra

Companies: #nvidia

With the tech industry taking a big beating in the financial stakes, it’s no surprise that Nvidia posted a loss of $201.3 million ($0.37 per share) for the first quarter of fiscal 2010 yesterday. However, Nvidia’s CEO Jen-Hsun Huang is determined to look on the positive side, and predicts that GPGPU computing and Nvidia’s Tegra platform will become big money spinners for the company in the future.

In a webcast to coincide with the announcement of Nvidia’s figures, Huang said that “during the quarter, we made good progress managing operating expenses and reducing inventory.” With regards to the latter, Nvidia says that it’s reduced its inventory days from 144 to 64 compared with the previous quarter. The company also points out that its revenue has grown 38 percent sequentially from the fourth quarter of fiscal 2009.

However, Nvidia’s revenue has still dropped severely in comparison with the first quarter of fiscal 2009. For the first quarter of fiscal 2010, Nvidia reported revenue of $664.2 million, compared with a massive $1.2 billion in the same quarter in fiscal 2009 – that’s a drop of 42 percent. AMD's figures showed a similar story, with dramatic losses in the fourth quarter of fiscal 2009, but much better results in the first quarter of fiscal 2010.

Looking on the positive side, Nvidia points to its recent market share figures from Mercury Research, in which Nvidia was shown to have 69 per cent of the discrete desktop GPU market. Nvidia also said that the figures for the last quarter were better than the company expected, particularly in comparison with the fourth quarter of fiscal 2009. Nvidia’s chief financial officer, David White, said that the sequential growth of 38 percent was “significantly higher than our estimate, which was flat to slightly up.”

In the future, Huang said that the company would continue to invest in four main initiatives: “one, maintaining our GPU leadership; two, driving the GPU computing revolution; three, increasing the adoption of GPUs in all segments of computing; and four, leading the mobile computing revolution.”

Huang pointed out that “GPU computing will be incorporated into the two most important operating systems in the very near future - Windows 7 with DX compute, and OS 10 Snow Leopard with Open CL.” These operating systems, says Huang, “will incorporate GPU computing into the core operating system and the GPU will become indispensable to achieve a great computing experience.”

Huang also has a lot of faith in Nvidia’s mobile Tegra system-on-chip technology. “More than 400 million of these devices will be shipped in 2012,” said Huang, adding that “our nearly four-year investment in Tegra has positioned us squarely at the center of the next computing revolution. We estimate that Tegra has opened up an additional $10 billion growth market for us.

Do you think that GPGPU computing become “indispensible” in the future, and will Tegra be the runaway success that Nvidia predicts? Let us know your thoughts in the forums.
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