On the mend
Graphics giant NVIDIA appears to have turned things around after a couple of bad quarters, reporting second quarter revenue up 17 percent on the previous quarter.
NVIDIA raked in $776.5 million in Q2, which compares favourably to $664.2 million the previous quarter, but is still 13 percent down on the same period a year ago and still yielded a net loss of $105.3 million.
Viewed in a broader context, these results represent a continued recovery from NVIDIA's disastrous Q4 and it should be borne in mind that, under normal circumstances, you expect a drop in revenue in Q2. They also beat analyst expectations and NVIDIA's stock was consequently up nine percent in after-hours trading.
Jen-Hsun Huang, president and CEO of NVIDIA, continued to stress its diversification in his statement. "NVIDIA's business is recovering. Product demand is improving, and our strategic investments are leading to new growth," he said. "Our two newest businesses began to ship meaningful amounts of product this past quarter and show significant promise.
"Tesla, the industry's first GPU for general-purpose high performance computing, achieved its highest-ever quarterly revenue. And Tegra, our ultra low-power computer-on-a-chip, is making exciting progress in the market for mobile and embedded devices. Our new businesses are positioned to benefit from the rise of mobile and cloud computing."
Lastly, it doesn't look like ConnectorGate has gone away yet either. Here's NVIDIA's statement on its impact on Q2: "NVIDIA's second quarter results were impacted by an additional net charge of approximately $119.1 million to cover costs related to a weak die/packaging material set that was used in certain versions of its previous-generation chips.
"Although the number of units impacted by this issue remains consistent with the company's initial estimates a year ago, the cost of remediation and repair of impacted systems has been higher than originally anticipated. In July 2008, a $196.0 million reserve was accrued for the purpose of supporting our affected customers around the world. The weak die/package material combination is not used in any products currently in production."
