Original URL: http://www.theregister.co.uk/2008/08/12/nvidia_quarter_ouch/
Nvidia pulls off Project Blowout in Q2
Disappointing disaster
Posted in Financial News, 12th August 2008 23:05 GMT
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Last month, Nvidia promised [1] to bomb its second quarter. Today, the company delivered on those promises in smashing fashion.
The graphics chip maker's revenue dropped 5 per cent to $892.7m. In addition, the company posted a net loss of $120.9m, which compares to a profit of $172.7m in the same period last year.
Perhaps worst of all, Nvidia took a $196m charge "to cover anticipated customer warranty, repair, return, replacement and associated costs" tied to a defect in certain notebook products.
Big talking Nvidia CEO Jen-Hsun Huang copped to the obvious.
"Our Q2 financial performance was disappointing," he said. "The desktop PC market around the world weakened during the quarter. And our miscalculation of competitive price position further pressured our desktop GPU business."
To assuage investors, Nvidia announced that it would buy back an additional $1bn worth of stock, kicking its total repurchase program up to $2.7bn.
This move seemed enough to please investors in the short-term with shares popping up more than 10 per cent in after-hours trading. ®