Another record quarter for NVIDIA; 3-2 stock split announced.

JoshMST

Regular
NV just announced gross revenues of $935 million, and a net income of $172.7 million.

That's a lot of chips they sold last quarter...
 
Indeed, nice 'start'! ;)

Anyway, here's the usual pseudo-transcript. Sadly, it's not quite as interesting this time around, but that's not my fault if there wasn't anything juicy! Intel MCP is now an 'early volume in Q3, bigger ramp in Q4' product, fwiw.

Regarding share, there was some dodging implying that ATI was still very competitive and that fighting for OEM sockets was hard - regarding share in general, they seemed rather confident however, but didn't go into much detail.

The stock was up in AH initially, but is now down because of the inventory concerns. This is going to be fun to watch once the new analyst ratings come in... Guidance was 5-7% higher than Q3, so that's $980M to $1B. If they can top that, then they will be there in Q3. Otherwise, $1B seems incredibly likely for Q4 at least.

NVIDIA CC said:
[Legal statements...]

[Jen-Hsun]
- Record revenue, margins and net income.
- Record quarter despite it being historically the slowest quarter.
- Desktop & Notebook GPUs achieved record revenue. Continued to capture leading share.
- Tesla launch information, Maximum PC Dream Machine, etc.

[Marv]
- Sorry for the coughing!
- Strong revenue growth exceeding our guidance.
- Strength mostly in desktop and notebook GPUs.
- MCP grew nicely, but as expected.
- Notebooks grew 50% QoQ with Santa Rosa.
- Desktops grew mostly in mainstream.
- Continued to improve margins thanks to GF8.
- Continued to hire: 299 new employees, two third in R&D.
- The operating cash flow was more than $300M, second quarter in a row.
- Inventory of 50 days. Quarter more evenly loaded which helped inventory.
- Capital expenditures were $30M, amortization

- Outlook: Starting from higher base... But expecting 5-7% revenue growth.
- But expect growth in most areas, especially notebooks and workstations.
- Margin improvement is still possible in Q3, workstations help there.
- OpEx is expected to grow by 5-7% too, tax rate remains 14%.

[Jen-Hsun]
- Listing growth factors for GPUs in general...
- Believe we can continue to grow share.

- Intel motherboard GPUs: New pricepoint for this kind of product.
- Hybrid SLI: Energy efficiency and maximum performance at the same time.
- GeForce 8 Motherboard GPUs will be available this fall.
- Adoption of Tesla and CUDA far exceeded his expectations.

---
Q&A
---

Q: Are you seeing a Vista fracture?
A: Well, this can't be all sharegain...
So it's very clear the size of the GPU market is larger than several quarters ago.
Vista, DX10 & HD Video are all playing together into this.

Q: Growth for non-PC segments - how much do you expect this will add to your growth?
A: Share gain and appreciation of GPUs by customers help the core business.
There's still about 60% GPU share to capture!

Going forward, we think about what markets we enter, such as Intel motherboard GPUs.
Core logic is several billion dollars, we only have a small fraction of that today...
Believe single-chip application processor with computing expertise could be huge.
It's multiple billion dollars large.
Tesla is the hardest one to guess, because it's the most disruptive for the market.

Growth is actually *mostly* related to new markets we enter, we believe.

Q: Revenue long-range forecast?
A: Haha, you won't get your long-range forecast.
Depends a lot on how fast we advance in some growth opportunities.

Q: Timing for the next-generation GPU?
A: Hmmm... We don't announce products until they're actually on the shelves.
But I think the NVIDIA schedule is sustainable and we're still very committed to it.

Q: Supply constraints?
A: Should be okay for both the back-end and the front-end.

Q: Tax rate?
A: 14% in Q1/Q2/Q3.

Q: MCP dropped much in Q1, didn't improve as much in Q2?
A: Seasonality, didn't push it, focused on GPU.

Q: Inventory constraints in Q2?
A: Less than reserve now, so constraints leave us with some caution for Q3...
Might be slower than industry rate because of this (-> the 5-7% forecast).

Q: Channel?
A: We monitor the inventories as much as we can...
We believe the inventory in the channel is pretty lean right now
And we expect this to remain for some time.

Q: Intel motherboard GPU? Start in Q3, much more real ramp in Q4?
A: Fair to say.

Q: Foundries?
A: Best partns n the world. Expecting things are going to come out just fine.

Q: Inventory goals?
A: 70 days... Right now at 49, so pretty lean inventory.

Q: GPU growth?
A: Only thing that took advantage of GPUs 5 years ago is video games.
Today there's Google Earth, Photo/Video editing, Operating System, Animation, etc.
Video processing and High Definition Video... More and more applications.
All this happening at a time when the costs of developing a GPU are going up.

Q: ASPs?
A: Historically flat or slightly up.
Not in our practice to raise prices for customers however (so it's just natural).

Q: Mainstream & Enterprise?
A: Our mainstream DX10 GPUs entered a solid 1-2 quarters ahead.
The momentum is clearly very strong. Marketshare data reflects that.
We don't win everything and still see a lot of competition from our competitor.
Have to fight for every socket. I don't think anything is going to change there.

Q: Inventory constraints?
A: We think we'll be able to work out way through it, but we'll see.
Too many unknowns.

Jen-Hsun: We're not gapped out, it's just tight! Foundries are near capacity.
We have to be much more focused and much more precise with our forecasting.
We are telling you the industry is tight, but you already know that!

Q: Potential for more margin upside with GF8 ramp?
A: We are at more than 50% of the benefit from that but not 100%.
We are trying to make cut costs further within that family too.
Jen-Hsun on operational efficiency etc...

Q: Margins for Tesla?
A: 'Much higher!' haha.
We're still trying to figure the size of the Tesla opportunity.
Could be anything from a lot to a ton... Focused on being able to serve customers.

Q: ASPs in GPUs QoQ?
A: Relatively flat.

Q: Demand for low-end vs high-end?
A: 8800 demand is really really solid.
Continues to be very good going into 2H.

Our partners have their own strategies wrt pricing.
Maybe what you're seeing is related to their own initiatives.

Q: Workstation and workstation growth lower?
A: We just didn't have to push it.

Jen-Hsun: Outstanding quarter. Expanding the reach of the GPU.
Thank you for joining us today, we look forward to reporting on our results for Q3.
 
Best opening I've heard to a CC in a long time!

On the theory that "no news is better than bad news" I'd at least have to agree that opening was better than anything we've heard from an AMD results call in quite awhile! :p
 
Ho hum. Another quarter, and more record results for NVIDIA. In what is typically a seasonally down quarter, the graphics maker obliterated pre-announcement consenus results of $860M in revenue by throwing down with $935.3 million instead.

Read the full news item
 
When GeForce N-cards are connected to GeForce motherboards, Hybrid SLI kicks in.

Maybe i got it all wrong and the letter stands for any given generation of SLI-supporting graphics cards, but can this be a hint of the future naming scheme ?
Instead of "Geforce 9", "Geforce Nxxx" could be an intelligent move to prevent the proverbial joke of a "Geforce 9800". ;)
 
Yeah. It's been pointed out to me that 75% DX10 number is from Mercury Research (as it says right in NV's PR), and thus it isn't results thru NV's Fiscal quarter thru July 29th after all. It's actually calender Q2 (Apr-Jun) results. At that point, the amazing thing isn't how NV had 75% of DX10; the amazing thing is why didn't they have more. This actually offers support for some of the rumors we were dealing with at the time that suggested that AMD was shipping RV610/RV630 to OEMs for some weeks before retail channel availability. Otherwise it's hard to see how they could have done even as well as 25%. I'm really looking forward to the Q3 numbers.
 
Well, perhaps I am being too much of an optimist, but I think AMD will show much better numbers this next round. Seems HD 2400 and 2600 have been doing quite well, and the Apple win will certainly help! They are staying competitive with the CPUs, so I think Q3 will look a whole lot better than Q2.

Now if they can just get that high end refresh out...
 
Well, perhaps I am being too much of an optimist, but I think AMD will show much better numbers this next round. Seems HD 2400 and 2600 have been doing quite well, and the Apple win will certainly help! They are staying competitive with the CPUs, so I think Q3 will look a whole lot better than Q2.

Now if they can just get that high end refresh out...

They've won the iMac again, but lost the Macbook Pro to Nvidia. It will be interesting to see which is worth more in the long run.
 
They've won the iMac again, but lost the Macbook Pro to Nvidia. It will be interesting to see which is worth more in the long run.

That is terrible news for AMD. I wonder what Apples split is on Macbooks vs iMacs. Mobile market is growing by leaps and bounds while desktops have been stagnant for some time and I expect that arena to shrink over time as laptops become more capable.
 
Good, capable laptops have gotten more reasonable in price, which has helped. I just bought pretty much the top-end ThinkPad for about $2. I can remember, not so long ago, when that would have been a $5 purchase.

The fact is, there are a lot of really good mainstream laptops for less than $1k these days.

Tho not as many have discrete graphics. The 15.4" MPB is about the same price as the ThinkPad, $2k.
 
One of my favourite point estimates is ROE(I). In this case it's quite telling:

NVDA: 29%
AMD: -35%

For comparison, the car industry:

GM: 43%
F: -162%
DAI: 11%
TM: 15%
 
Back
Top