Nvidia probes executive stock option practices
Admission overshadows record-revenue announcement
Nvidia announced last night it had received record quarterly revenues during Q2 FY2007, which ended 30 July 2006. However, the statement was overshadowed by the company's revelation that it has begun to investigate stock options it has offered to staff since it went public in 1999.
Indeed, the graphics chip maker failed to announce net income and other financial figures for the period, choosing instead to make such data public more more than a month at the latest. Its deadline for filing this information with the US Securities and Exchange Commission is 13 September.
Nvidia did say that sales for the three-month period topped $687.5m, up 19.6 per cent from the $574.8m but a more modest 0.8 per cent on the previous quarter. The company lauded "strong performance: in desktop, notebook and handheld GPU sales, in chipsets and professional solutions.
Investors, however, will be more interested in the company's stock options probe, currently being conducted by the board's audit committee and "outside legal counsel". Nvidia's admission comes a week after it emerged that Apple may have to restate 15 fiscal quarters' worth of results should. The Mac maker said last Friday it had discovered "irregularities" in the way it offered stock options to senior executives.
Nvidia said its audit committee had "reached a preliminary conclusion that incorrect measurement dates were used for financial accounting purposes for stock option grants in certain prior periods". The company indicated it's likely to compensate for that in the Q2 FY2007 figures, which is why it can't report net income numbers until the audit is completed. Any such adjustment will not change the revenue figure. ®