HEXUS.sharewatch: NVIDIA shares plummet – iPad 2 effect?

"Never in the field of tech conflict was so much damage done to so many companies by such a small launch," as Winston Churchill would likely have said were he still alive and a tech blogger rather than political leader.

The feeling around the web is unanimous: Apple didn't do that much with the launch of the iPad 2, and that was still enough to kick everyone else's ass.

The evidence of this consensus is apparent in the movement of tech stocks last week. By far the biggest loser was NVIDIA, which had seen its stock rise to its highest levels for three years on the back of the buzz around Honeycomb tablets at CES and MWC.

But the fickle market is now far less bullish about Android tablets after the launch of the iPad 2. If anything what impressed people most about the launch was that Apple didn't even seem to be trying. The general feeling now is that Apple owns the tablet market and can raise its game just as much as is necessary to swat the competition.

Given that the first wave of Honeycomb tablets all run NVIDIA's Tegra 2, any downer associated with them will be passed directly onto NVIDIA, and that's exactly what happened. Tegra 2 uses ARM's Cortex A9 CPU design, but so does the Apple A5, so ARM's not bothered who wins. Further evidence of the iPad 2 effect lies in Apple being one of the few tech stocks to rise last week.