Big picture, big profits
NVIDIA is celebrating a resounding third-quarter profit that it's attributing to higher margins and increasingly strong demand for its GPUs.
The 74 per cent increase in profits, compared to Q3 fiscal year 2009, came in well above analyst estimates as well as the firm's own predictions and is the second fiscal third-quarter profit for NVIDIA in the past five quarters.
NVIDIA posted a profit of $107.6 million, translating to 19 cents a share, way up from $61.7 million - or 11 cents a share - this time last year. The firm's Q3-to-Q3 revenue was marginally up, by 0.6 per cent, to $903.2 million and its GPU business posted a whopping 25 per cent growth from the second quarter of 2009. The company's gross margin also rose from 41 per cent to 43.4 per cent.
Back in August, NVIDIA had estimated its revenues would fall somewhere between $815.3 million and $830.9 million, which was already above analysts' expectations. But thanks to what NVIDIA CEO, Jen-Hsun Huang, called "healthy market demand across the board," NVIDIA seems to have surprised even the most sceptical of critics.
Huang said "revenue was up from a year ago, with improvement in each of our PC, professional solutions and consumer businesses." The firm reckons it has benefited from a renewed demand for PCs and consumer electronics as the recession weakens.
"It's great to see us shipping orders with our Tegra mobile-computing solution, and growing enthusiasm for our Tesla platform for parallel computing in the server and cloud-computing markets," Huang continued.
Jen Hsun also said his firm had shipped everything it had in stock this quarter, implying that if it had not had any supply constraints on its 40nm chips, it would have been able to sell even more.
It has been suggested that NVIDIA killed off some unprofitable - but presumably still desired - products recently, which may have contributed to the firm not shipping enough to satiate demand. Had the firm been able to satisfy that demand it "certainly would have contributed to even better profits," graphics guru Jon Peddie told HEXUS.
