Silencing the doubters
Chip-maker NVIDIA saw its shares jump by over ten percent in pre-market trading following the announcement of quarterly results that beat many expectations, and a stronger-than-expected forecast.
"We grew solidly this quarter," said Jen-Hsun Huang, NVIDIA boss. "Consumer demand for notebooks powered by our GeForce GPU, with its unique Optimus technology, resulted in record revenue for these products. The future of computing is mobile and visual. With Tegra's momentum and our growing GPU businesses, we are ideally positioned to lead the industry forward."
NVIDIA's shares soared at the start of this year as its Tegra 2 chip emerged as the default for the ‘Honeycomb' generation of Android tablets. But as it became clear that these products weren't selling as well as hoped, NVIDIA's shares took a corresponding nosedive.
The most recent results, which you can be summarised below, feature healthy quarter-on-quarter growth from the consumer products business, which features Tegra, in spite of the slow start for Honeycomb tablets. But then again it's not directly NVIDIA's problem if its customer fail to sell their devices. The flat GPU growth hides the fact that growth in notebook GPUs was offset by the continued decline in revenues from the chipset business, which NVIDIA is exiting.
In the earnings Q&A, which was promptly transcribed, as ever, by Seeking Alpha, there were a few interesting quotes from Huang, which we've reproduced below.
Regarding the 28 nm chip manufacturing process: "We have working silicon and, momentarily, about to go to production with 28-nanometer. And it's looking really good, it's looking much, much better than our experience with 40-nanometer."
Regarding the next Tegra chip: "And Kal-El, it's going to be world's first quad-core processor. And it's so much higher performance than Tegra 2 and at so much lower power. And very few people have internalized that Kal-El is lower power in every use case compared to Tegra 2. And so this is, it's really a great breakthrough based on the technology we call variable SMP, variable symmetric multiprocessing, that makes it possible for us to achieve much higher performance where performance is needed and much lower power in almost everything that you do."
Regarding sales of Android tablets and competing with Apple: "At some level, it's weird to put an injunction on a product that's not selling. And so it must be selling really well. The early products had a clumsy launch, and we already talked about that. But the Android 3.1 and 3.2 are just fabulous. And the apps all followed, and more and more apps are showing up all the time, and these devices are getting better all the time... And although it started out a little clumsy, it fixed itself very quickly. And now the Android devices are selling wonderfully. And I just saw the market share data. I thought that it showed 30% and growing. And it looks like the Android tablets are a huge success."
