Nvidia Announces $141 Million Net Loss in Q2FY11
Nvidia's bottom line took a bit of a hit.
Nvidia today reported revenue of $811.2 million for the second quarter of fiscal 2011 ended Aug. 1, 2010, down 19.0 percent from the prior quarter and up 4.5 percent from $776.5 million from the same period a year earlier.
Things weren't all rosy, however, as on a GAAP basis the company recorded a net loss of $141.0 million, or $0.25 per share, compared with net income of $137.6 million, or $0.23 per diluted share, in the previous quarter and a net loss of $105.3 million, or $0.19 per share, in the same period a year earlier. GAAP gross margin was 16.6 percent compared with 45.6 percent in the previous quarter and 20.2 percent in the same period a year earlier.
Nvidia said that its losses were partly due to the large inventory write-down and a charge related to a weak die/packaging material set. The inventory write-down was a consequence of weakened demand for consumer graphics processing units (GPUs) as higher memory prices and economic weakness in Europe and China led to a greater-than-expected shift to lower-priced GPUs and PCs with integrated graphics.
The weak die/packaging material set was used in certain versions of previous generation MCP (chipset) and GPU products shipped before July 2008 and used in notebook configurations. The charge, of $193.9 million, includes additional remediation costs, as well as the estimated costs of a pending settlement of a class action lawsuit consolidated in the District Court for the Northern District of California in April 2009 related to this same matter. The settlement is subject to certain approvals, including final approval by the court. Excluding this die/packaging material charge and the associated tax impact, non-GAAP net income was $20.1 million, or $0.03 per diluted share.
"Rapidly changing market conditions made for a challenging quarter," said Jen-Hsun Huang, Nvidia's CEO and president. "We delivered excellent results in Quadro professional graphics, Tesla GPU computing, and our Tegra system-on-a-chip business. But our GeForce consumer business fell significantly short of expectations amid weak PC demand in Europe and China. Although demand among end-users remains uncertain, we expect to drive revenue and grow market share with new products that are gaining momentum in each of our businesses."
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that's surprising that it's that big a loss
Yeah blame it on low demand. But we all know u are lossing money bcos of ur G_Toaster. Get real nVidia
The losses were due to AMD/ATI selling superior hardware. Period.
Low consumer demand? Err ATI couldn't build em quick enough when they launched the 5000 series.
it took them a long time to come out with Fermi and with the hunger power source of the GPU melting the ice caps many people purchased the lower cost, lower PSU usage AMD products. They need to make new products in the lower $100 range instead of the high end $400 market. Right now all I see is the good old 9800 GT and the 240/250 for under $100.
Hitler was right..this is all Jen-Hsun Huang's fault !!!!
Nvidia has been seeing more and more engineering issues as of late. They couldn't reduce the GT200 architecture, and thus couldn't make a cheaper component for the maintstream market. Then their latest release, Fermi, is delayed and experiences yield issues. I think the lack of new product is a bigger factor than Nvidia is letting on. I think a lack of demand results from rebadging a GPU three times and assuming the consumer is just going to keep buying it.
I hope that the 450 will come out on a smaller die, more efficient, less power consumption and less heat. But we all know that won't happen.
Fermi was way too late, and until the GTX460, too hot, and too power-hungry; in short, too FAIL. I really hope for their sake (and ours), that they aren't limited to hoping that one chip (GTX460) can save their bacon, with the HD6000 series looming.
240 was a joke, fermi was late and underwhelming, Intel stuck it to Ion and the ATI 5xxx series put the beats to their lineup all across the board.
So this is not really a surprise.
However, releasing things like the 460 will put them back in black. It is a good card.
Only took 6 posts for Godwin's law to appear.
And three more for someone to needlessly point it out.
You know I almost didn't read this article because i had a feeling there would be a lot of ignorant comments at the bottom... Total lack of surprise, here they are. I say wait till the next quarter or maybe the one after that to truly say if ATI spanked Nvidia or not. At the very least understand that balance sheets arnt black and white...
Seeing their diminished presence in the chipset/IGP area for mainstream PCs is kinda depressing cuz it made me feel like their presence in the discreet graphics market may somehow follow. I like my 8200 and its VDPAU capability. In fact my HTPC and office PC have nVidia cards on top of ATI based boards just because, at the time, they were more Linux friendly. But right now they're behind ATI. Not greatly, but noticeable.
ATI skeet skeet skeet.
Yeah blame it on low demand. But we all know u are lossing money bcos of ur G_Toaster. Get real nVidia
If people would stop putting them in laptops and start putting them in the kitchen, it might make sense.
Well, so much for the so called wonderful powerful Fermi. They can claim that it was due to chipsets, lawsuits but their latest graphics line isn't profitable to them at all. They can maintain market share with good pricing, but they can't maintain profits. Enough said.
I was curious how Nvidia would do this year, they were very late to release their new GPU's giving AMD/ATI a huge advantage. Fermi was also over hyped (until G104 (ie GF460). Hopefully the 460 will help them cut their losses, I am all for a competive market. Also the lack on onboard graphics for Intel chipsets is a huge loss for Nvidia. Before you say im an Nvidia fanboy, all my computers are Intel CPU's and ATI graphics
"weakened demand for consumer graphics processing units (GPUs)"
should be
"weakened demand for Nvidia graphics processing units (GPUs)"
141 million net loss is due to the amount of software developers they paid off to have said developer's games favor nvidia over ATI for FPS results.
You know I almost didn't read this article because i had a feeling there would be a lot of ignorant comments at the bottom... Total lack of surprise, here they are. I say wait till the next quarter or maybe the one after that to truly say if ATI spanked Nvidia or not. At the very least understand that balance sheets arnt black and white...
and here it is guys finally an nVidia fanboy response, face it we all know why nVidia made the loss even nVidia fan boys like you do, no smoke screen will cover the fact the 240 was way too weak, rebagging GPUs 2 or 3 times! and of course the joke aka GTX480/GTX470
I was curious how Nvidia would do this year, they were very late to release their new GPU's giving AMD/ATI a huge advantage. Fermi was also over hyped (until G104 (ie GF460). Hopefully the 460 will help them cut their losses, I am all for a competive market. Also the lack on onboard graphics for Intel chipsets is a huge loss for Nvidia. Before you say im an Nvidia fanboy, all my computers are Intel CPU's and ATI graphics
I will be interesting how the FDA lawsuit will affect Intel because i beleieve they are no longer allowed to lock other companies out of Graphics for the Core I5/i7, but this is not enough nVidia need to increase yields on the 460
*Watches the ati fanbois roll em out* lol
while u do that i'll be happy with my gtx480
Good to see that the GPU packaging thing hurt them a little bit... I can't go 2 consecutive days without one of their POS GPUs bringing one of my companies corporate laptops down.
Well I did my part. My GTX 460 is awesome.
Low consumer demand? Err ATI couldn't build em quick enough when they launched the 5000 series.
Well since ATI had a large head start I can see demand being low for Nvidia, since everyone already has ATI cards
I hope they recover. We need the competition.
Radeon 5xxx cards did not go down in price until Fermi arrived (horribly late) on the market.
I am very concerned about the Tegra strategy of the company. Nobody seems to be interested in the product yet they are working on Tegra 3. And AMD is apparently going to ship Ontario APU's at the end of this year... I really would hate to be in Huang's shoes right now.
The losses were due to AMD/ATI selling superior hardware. Period.
I think its more due to the fact that they were too focused on Intel and didn't look at ATI or focus their efforts on Fermi.
In raw performance, Fermi is not that bad. But price/power kills it. Maybe if they spent more money on Fermi and less on artist to draw Intel comics they would have done better.
I might just have to invest in a few new ATI cards this fall, I'm sure not interested in anything from Nvidia right now.
No worry, I will go for the GTX460. So if they see growth in the next quarter, I will be part in
I put 5k in NVDA when it was 16$ a share. It is now worth 9$ a share, I am pissed. I will ride out the **** storm, but I am apparently horrible in picking good company's to invest in. Sigh.
I think thats because of losing the lawsuit to Rampus and poor supply of its late consumer graphics, things just arent going good for nvidia this quarter but I doubt this will continue beyond this year