Tuesday Nvidia president and chief executive officer Jen-Hsun Huang said that a vast majority of the company's revenue will be generated by its mobile processor business and not its long-standing graphics card division. In fact, revenue from Nvidia's mobile chip arm is expected to grow to $20 billion by 2015 – its PC-based GPU business will only grow to $7 billion in the same timeframe.
Those numbers speak volumes about where the industry focus is pointing. Nvidia, a company that literally helped transform the desktop and laptop sectors over the last two decades, is looking to the mobile sector for most of its income, seemingly mirroring the game industry's focus on consoles (rather than PC gaming) because that's where most consumers are spending their money.
"If you don't have a mobile strategy, you're in deep turd," Huang said. "If you're not in mobile processors now, you're seven years too late."
Does this mean the desktop sector will eventually die? Based on previous reports, Nvidia has said that there will always be a market for the enthusiast who wants top-of-the-line hardware that pumps out picture-perfect graphics at 60 frames per second. And while we'd like to believe that these consumers are what drives the industry forward, the shift to mobile computing speaks otherwise. Still, as Huang points out, cameras in smartphones didn't kill off the digital-SLR business – they only drove the need for higher picture capture capabilities.
Seemingly propelling the mobile market is Google's Android OS. Speaking to a roundtable of reporters on Tuesday, Huang said that Android-based tablets will make up half of the market in four years despite their slow start, achieving the same market saturation as Android-based phones. Tegra chips are already installed in half of the high-end Android smartphones and 70-percent of the Android tablets. Yet there's still an addressable market of 100 million devices that need mobile processors this year alone, a number which is expected to balloon to around 1 billion by 2015.
"The future for computing is visual and mobile, and we are well positioned to lead in this new era," Huang said Tuesday (opens in new tab) after the company said that it anticipates revenue of $4.7 billion to $5.0 billion in fiscal year 2013, which begins Jan. 30, 2012. Company growth is expected to be fueled by additional mass-market smartphones, computers running on more efficient ARM chips, and the saturation of energy-efficient ultra-thin notebooks in the coming years.
Right now Nvidia sees Qualcomm as the only competitor, the only other "person actively on the dance floor." Now that HP has divided up its webOS division, the global OEM doesn't appear to have a clear mobile strategy. Intel isn't considered much of a threat either given that the company has chosen to stay within its x86 roots while most of the smartphones and tablets available on the market are based on ARM's licensed architecture (and mobile applications are written based on ARM's instruction set).
"They're speaking the wrong language," he said. "We're not worried about them at all."