NVIDIA cashs in on Xbox chips? Wow - that's a first.

[zurich]

http://news.com.com/2100-1047_3-5061321.html?tag=fd_top

The company reported net income of $24.2 million, or 14 cents a share, for its second quarter, which ended July 27. That compares with income of $5.3 million, or 3 cents a share, in the same period a year ago and the consensus estimate of 11 cents a share from analysts polled by research firm First Call.

Revenue for the quarter was $459.8 million, compared with $427.3 million a year ago.

In a conference call with financial analysts following the announcement of the results, Nvidia CEO Jen-Hsun Huang attributed much of the growth to increased shipments of Xbox parts to Microsoft

So much for NVIDIA selling the chips at or below cost

What's interesting is that many people speculated that there are millions of Xboxen sitting in warehouses, unsold. However, why would MS order more chips from NVIDIA if this was the case? Wouldn't their inventory be more or less sufficient for the holiday season?

Guess I should point out that the 'Limited Edition Holiday 2002 Sega Pack' is still available for purchase everywhere :?

Anyhow, Xbox sales was probably the last place I was expecting NVIDIA to attribute 'better than expected' profits from heh.

edit: has there been any talk of shrinking NV2A/MCP to .13 micron?

 

[rabidrabbit]

Is this any way connected to the Focus Enhancements' TV chip that is to replace the old chip in xbox?
I don't know, that's why I ask.
But can it be nVidia had to make some minor modifications to their xbox chip(s), not necessarily the graphics chip, 'cos aren't they also supplying other parts like nForce type motherboard chips?
Or is MS going to launch a smaller xbox for christmas?

 

[zurich]

Is this any way connected to the Focus Enhancements' TV chip that is to replace the old chip in xbox?
I don't know, that's why I ask.
But can it be nVidia had to make some minor modifications to their xbox chip(s), not necessarily the graphics chip, 'cos aren't they also supplying other parts like nForce type motherboard chips?
Or is MS going to launch a smaller xbox for christmas?

Well MS has said ad nausem that there won't (unfortunately) be a redesigned Xbox :? Guess it sort of makes sense, since they're probably still waiting for economies of scale to kick in..

 

[cybamerc]

Just to be nitpicky, it doesn't really say if XGPU contributed to the growth in income or revenue. Though to be honest I doubt they ever actually lost money on it.

 

[archie4oz]

So much for NVIDIA selling the chips at or below cost

Did anybody state that? I thought it was pretty well known that NVIDIA was by far the highest bidder for the contract and that MS (or those within the core Xbox design team) were pretty adamant about getting the NVIDIA name on their box... I mean originally Jen-Hsun was asking for something like $90 a chip for the NV2A (IIRC the contract was later settled for something like $53 a chip for the first year)...

Is this any way connected to the Focus Enhancements' TV chip that is to replace the old chip in xbox?
I don't know, that's why I ask.

No, that was primarily a cost-cutting issue by MS made quite some time ago...

 

[zurich]

Did anybody state that? I thought it was pretty well known that NVIDIA was by far the highest bidder for the contract and that MS (or those within the core Xbox design team) were pretty adamant about getting the NVIDIA name on their box... I mean originally Jen-Hsun was asking for something like $90 a chip for the NV2A (IIRC the contract was later settled for something like $53 a chip for the first year)...

During the arbitration, NVIDIA was screaming foul as they'd be forced to sell at/below cost if things didn't go well for them.

 

[cybamerc]

It's all part of the game. You don't expect them to say that they're making a killing on each chip sold?

 

[Brimstone]

It's all part of the game. You don't expect them to say that they're making a killing on each chip sold?

But do you expect them to bite the hand that feeds them? Microsoft gave them a lot of money for the GPU and chipset. Nvidia didn't come across as very loyal in their comments about the arbitration as I remember events.

Around the same time wasn't Microsoft and Nvidia wrangling over some Pixel Shader patents?

 

[cybamerc]

Brimstone:

> Nvidia didn't come across as very loyal in their comments about the
> arbitration as I remember events.

Why should they be loyal? It was M$ that wanted to change the existing agreement.

 

[nonamer]

As I think about it, a NV2A is about half the size of a R300/R350 and is on the same process from the same company. IIRC, the cost of a R3X0 is about $30, so a NV2A should be $15 or less. $53 would have been a real ripoff, hence that disagreement between NV and MS.