News
 

Bookmark and Share

(0) 

Nvidia Corp., the world’s top supplier of discrete graphics processing units (GPUs), on Tuesday revised its revenue guidance for its fourth quarter of fiscal 2009 ending January 25, 2009. According to the company, its revenue will collapse by as much as 50% because of the global economic crisis and lowering demand for graphics cards, professional products and chipsets.

The company said that revenue for the fourth quarter of fiscal 2009 is expected to be lower than guidance provided during its third quarter fiscal 2009 financial conference call held November 6, 2008. Total revenue for the fourth quarter of fiscal 2009 is now expected to decline 40% to 50% sequentially as a result of further weakness in end-user demand and inventory reductions by Nvidia’s channel partners in the global PC supply chain.

For the third quarter of Nvidia’s fiscal 2009 revenue was $897.7 million, which means that for the fourth quarter revenue will be in the range between $448.85 million to $538.62 million.

While Nvidia did not outline which product segments demonstrated largest declines during the quarter, it is not hard to make certain assumptions based on Nvidia’s Q3 FY2009 performance and revenue split. Considering that more than half of Nvidia's sales come from GPU business, whereas another 44% come from chipset and professional solutions businesses, it is evident that the company saw substantial declines in revenues virtually accross the board, perhaps, excluding professional segment.

Nvidia’s GPU business revenue decreased by 33% to $461.5 million in the third quarter of fiscal year 2009, compared to $689.9 million for the third quarter of fiscal year 2008. This decrease was primarily due to decreased sales of desktop GPU and memory products, which decreased by approximately 42% and 61%, respectively, compared to the third quarter of fiscal year 2008.

Nvidia’s chipset business revenue of $197.6 million in the third quarter of fiscal year 2009 was relatively flat when compared to revenue of $198.2 million for the third quarter of fiscal year 2008. A decrease in sales of Nvidia’s AMD-based platform products was offset by an increase in sales of our Intel-based platform products as compared to the third quarter of fiscal year 2008, according to the company’s filing with Securities and Exchange Commission.

Professional segment business (PSB) revenue increased by 31% to $199.3 million in the third quarter of fiscal year 2009, compared to $152.2 million for the third quarter of fiscal year 2008.

It is interesting to note that Nvidia’s consumer products business (CPB) revenue decreased by 48% to $34.2 million for the third quarter of fiscal year 2009, compared to $65.9 million for the third quarter of fiscal year 2008. The decline in CPB revenue is primarily driven by a combination of a decrease in revenue from Nvidia’s cell phone products, a decrease in revenue from our contractual development arrangements with Sony Computer Entertainment Inc. and a drop in royalties from SCEO resulting from a decrease in the number of units shipped due to the transition of the PlayStation3 to a new process node, which took place earlier in the fiscal year.

“The revision was not surprising, [but] the magnitude of the sequential revenue decline is far worse than expected. […] Given this steep drop in revenues, we forecast Nvidia to be unprofitable in the fourth quarter and the full year 2009,” said Craig Berger, an analyst with Friedman, Billings, Ramsey, in a research note.

Additional commentary pertaining to the fourth quarter of fiscal 2009 will be available when Nvidia reports its financial results for the fourth quarter of fiscal 2009 on February 10, 2009.

Tags: Nvidia, Geforce, Nforce

Discussion

Comments currently: 0

Add your Comment




Related news

Latest News

Wednesday, October 8, 2014

8:52 pm | Lisa Su Appointed as New CEO of Advanced Micro Devices. Rory Read Steps Down, Lisa Su Becomes New CEO of AMD

Thursday, August 28, 2014

12:22 pm | AMD Has No Plans to Reconsider Recommended Prices of Radeon R9 Graphics Cards. AMD Will Not Lower Recommended Prices of Radeon R9 Graphics Solutions

Wednesday, August 27, 2014

9:09 pm | Samsung Begins to Produce 2.13GHz 64GB DDR4 Memory Modules. Samsung Uses TSV DRAMs for 64GB DDR4 RDIMMs

Tuesday, August 26, 2014

6:41 pm | AMD Quietly Reveals Third Iteration of GCN Architecture with Tonga GPU. AMD Unleashes Radeon R9 285 Graphics Cards, Tonga GPU, GCN 1.2 Architecture

Monday, August 25, 2014

6:05 pm | Chinese Inspur to Sell Mission-Critical Servers with AMD Software, Power 8 Processors. IBM to Enter Chinese Big Data Market with the Help from Inspur