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Nvidia Tegra 3 Under Pressure After Tegra 2 Concerns

By - Source: Barron's | B 34 comments

A few days ahead of the introduction of the first Tegra 3 device, Asus' Transformer 2 tablet, and the announcement of the Nvidia's Q3 earnings results, a negative sentiment about the company's mobile processor success is building among analysts.

According to one report, several analysts have lowered Q3 and Q4 revenue expectations based on what they believe is an existing and developing weakness in GPUs and ultra-mobile Tegra processors.

Barron's said that UBS’s Uche Orji cut the revenue forecast for Nvidia's Q3 GPU business from $572 million to $543 million and the Tegra processor result from $178 to $136 million. Needham & Co.’s Rajvindra Gill pointed out that there may be "2 million to 4 million units of excess non-Apple tablets" in the market that need to be sold, which may ultimately affect Nvidia with a revenue shortfall of $40 to $80 million in Q4.

Of course, that inventory does not bode well for Tegra 3, which is set to make a buzz in the Christmas buying season. There won't be, however, much Tegra 3 inventory until Tegra 2 devices are sold. Response to the Transformer 2 tablet may be a good indication how well this new processor will do during the fourth quarter.

Market research firm JPR recently reported that Nvidia lost overall graphics market share to AMD and Intel as it is giving up the integrated graphics chipset market. However, JPR pointed out that Nvidia gained 10.9 percent market share in desktop discrete during the quarter.

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Top Comments
  • 19 Hide
    getreal , November 5, 2011 1:08 AM
    flinstone2323But can it play Crysis ?

    If you are really so desperate to make stupid comments in hopes to gain favor, try badmouthing Apple; you will have much more success.
  • 13 Hide
    SneakySnake , November 5, 2011 2:06 AM
    The real question is: can you people posting "can it play.." go play something and stop posting retarded comments
Other Comments
  • 0 Hide
    zanny , November 4, 2011 10:09 PM
    It doesn't help that Kal'el isn't even 28nm. It's supposed to use the old fab process we have had for 2 years. I know I'm waiting till Wayne comes out to get a tablet.
  • Display all 34 comments.
  • 0 Hide
    plznote , November 4, 2011 11:37 PM
    You might not know...
    There is always a chance.
  • -8 Hide
    Anonymous , November 5, 2011 12:14 AM
    "It doesn't help that Kal'el isn't even 28nm. It's supposed to use the old fab process we have had for 2 years. I know I'm waiting till Wayne comes out to get a tablet."

    Really ??? mmmmmmmmmmmmmmmmmbulshit!!! =(
  • 0 Hide
    dark_knight33 , November 5, 2011 12:55 AM
    UBS's who exactly? Just because *some* unknown analyst sitting behind a desk playing paper football makes a random prediction, we're supposed to sell off (investors), or hold off buying a tablet (consumers)?

    He's a nobody. And nobody will remember his name 5 minutes after Nvidia's Q4 earnings report beats his "expectations". Mean time, I will reap the profits when all the sheep who sold out and lowered the value of the stock on this guy's word try to buy back in when it shoots back up. Yeah, buy high and sell low, fools.
  • 19 Hide
    getreal , November 5, 2011 1:08 AM
    flinstone2323But can it play Crysis ?

    If you are really so desperate to make stupid comments in hopes to gain favor, try badmouthing Apple; you will have much more success.
  • -9 Hide
    Markon101 , November 5, 2011 1:36 AM
    The real question, can it play Metro 2033. The answer........ No, and who cares.
  • -9 Hide
    mayankleoboy1 , November 5, 2011 1:46 AM
    can it play BF3?
  • 13 Hide
    SneakySnake , November 5, 2011 2:06 AM
    The real question is: can you people posting "can it play.." go play something and stop posting retarded comments
  • 1 Hide
    schmich , November 5, 2011 2:53 AM
    dark_knight33UBS's who exactly? Just because *some* unknown analyst sitting behind a desk playing paper football makes a random prediction

    Huh? What he says doesn't make sense to you? It's quite logical.
  • -1 Hide
    de5_Roy , November 5, 2011 3:24 AM
    can it play....
    gotcha!
    anyway, nvidia's discreet market gain is good news for the high end gfx line. but the real money is in the low sub $90-$100 segment and nvidia has nothing there. amd rules that part. if nvidia hadn't screwed up fermi it would have been the leader.
    nvidia's higher end discreet cards are quite powerful but they're not exactly well rounded. for example all of amd's 6790+ cards are 256 bit, all the way to 6990. but nvidia has up to 384 bit cards which trade blows with amd's 256 bit cards. that's not really a good sign of efficiency.
    nvidia's new 28 nm gpus seem to be released much later than amd's. i wonder why tsmc could volume produce amd's 28 nm gpus but delay(have problems with) nvidia's.
    nvidia's optimus technology in notebooks is much better than amd's switchable whatever thingie. they also have much better driver support.
    amd's apus and intel's ever-improving igpus are taking away one of nvidia's biggest top earners imo. android's lack of sales doesn't help anything either.
    bottom line is: even if tegra 3 is better than tegra 2 nvidia will have a problem on their hands (no the top few percent high end dgpu market won't help them..much).
  • 0 Hide
    Anonymous , November 5, 2011 5:03 AM
    The report is not well written, no sources, just need to fill the quote of postings?
  • 0 Hide
    jurassic1024 , November 5, 2011 6:56 AM
    de5_roynvidia's discreet market gain is good news for the high end gfx line. but the real money is in the low sub $90-$100 segment and nvidia has nothing there. amd rules that part.



    You wish that were true. Intel still rules the low end. 60% i believe is the figure. You remember Intel, the company that everyone knows about, including every AMD customer. Same goes for Microsoft (vs Linux and Mac)... and nVIDIA (versus AMD in the discrete category). nVIDIA desktop GPU marketshare went up 10%. nVIDIA cant live on graphics cards alone, but they are still the big dog.
  • 0 Hide
    jurassic1024 , November 5, 2011 6:57 AM
    btw, AMD's Fusion APU's are eating into its own discrete graphic sales. Intel and nVIDIA both don't have that problem.
  • 1 Hide
    de5_Roy , November 5, 2011 9:43 AM
    Quote:
    You wish that were true. Intel still rules the low end. 60% i believe is the figure. You remember Intel, the company that everyone knows about, including every AMD customer. Same goes for Microsoft (vs Linux and Mac)... and nVIDIA (versus AMD in the discrete category). nVIDIA desktop GPU marketshare went up 10%. nVIDIA cant live on graphics cards alone, but they are still the big dog.

    i guess i wasn't clear enough when i said that. i was refering to lower end discreet gfx market. amd has come out with new 6xxx series low end card while nvidia has done nothing. amd's got new 6450, 6570, 6670 and 6770(and some other oem ones) they all are slightly improved version of their 5xxx counterparts . meanwhile nvidia has gt 430, gt 440, gts 450 and gt 550ti (and may be gt520something) against those cards. except 550ti all of them are older models and have higher price but lower performance. and 550ti is priced too high for its performance.
    and then there are amd's own desktop apus that have discreet class igps. nvidia has no equivalent there.
    in q3, intel does lead Overall gfx market with 60.4% with amd in second 23%, nvidia last 16.1%. nvidia's share in dgfx was up more than 10%.
  • 2 Hide
    de5_Roy , November 5, 2011 9:58 AM
    Quote:
    btw, AMD's Fusion APU's are eating into its own discrete graphic sales. Intel and nVIDIA both don't have that problem.

    amd's success with fusion apus is largely in the mobile(laptop, ultraportable etc) market. while the desktop apus are very capable, pc companies keep building pcs with low end dgfx. i've seen plenty of pcs with core i5 or i7 or pentium with radeon hd 64xx, 65xx or 66xx cards e.g. this one or this one. those gpus still have a market there. fusion is slowly creeping into low end dgfx market but amd is handling it in a good way. they offer asymmetric cfx with llano igp and low end dgfx, combine them and deliver better performance(for gfx capability at that price). besides, as long as amd is facing production problem and goes through the changes right now, amd's low end cards will stay a little longer.
    nvidia otoh has nothing there.their loss is because they're getting out of igp market, has no newer model entry level cards, too focussed on their socs, android, tegra etc. their low end cards are old, pricey and plain bad.
    intel has none of the problem of amd or nvidia. they simply put igp in their cpus and sell them.
  • 0 Hide
    fazers_on_stun , November 5, 2011 12:11 PM
    Quote:
    amd's success with fusion apus is largely in the mobile(laptop, ultraportable etc) market. while the desktop apus are very capable, pc companies keep building pcs with low end dgfx.


    Once Trinity and Ivy Bridge desktop CPUs with their improved on-die GPUs come out next spring, I think a lot of the low-end discrete GPUs will see their sales dry up. Trinity's GPU is supposed to be something like 30% more performance than Llano's, and IB's is supposed to be 60% more than SB's.

    However I'm personally waiting for those 28nm high-end GPUs for my next DT build :D . Not too many gamers enthusiastic about iGPUs that I know of..
  • 1 Hide
    tdenton1138 , November 5, 2011 2:56 PM
    ZingamTegra 2 is old shit that should have been phased out 6 months ago! And tablets over $300 - 400 are pure stupidity.


    Which is precisely why you should start your own company, develop a chip better than the Tegra 2 and then release it in a tablet for less than $300 - $400. You'll be rich. Let me know when its available.
  • 1 Hide
    elis60660 , November 5, 2011 6:00 PM
    I wonder if Tegra 2 lower sales has anything to do with their announcement of tegra 3 before Tegra 2 was even available for purchase. I was going to get a tegra 2 tablet, and then they said tegra 3 was going to be available only a few months later, so I decided to wait.
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