Nvidia yesterday increased its Q3 revenue forecast from $470-502m to $510-515, up to 8.5 per cent higher than it had previously predicted and up to 12.9 per cent above Q2's sales.

The graphics chip maker attributed the increase to stronger than anticipated demand for its products, in particular its GeForce 6 series members, the 6600 and 6200.

Nvidia's third quarter came to a close this past Sunday. It Q2 figures, posted in August, proved something of a "disappointment", with saw a 17 per cent decline in desktop chip sales drive net income down 78.9 per cent year on year despite a minor, one per cent dip in revenue to $456.1m over the same period.

If the company meets its best expectations, it will be the best performing quarter in terms of sales since Q4 2002 (November 2001 to January 2002).

Nvidia said Q3 gross margins would fall between 31.7 per cent and 32.7 per cent. ®

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