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SoC processors boost Nvidia revenue in Q3

Posted: 13 Nov 2013 ?? ?Print Version ?Bookmark and Share

Keywords:Nvidia? SoC processor? Tegra 4? SHIELD? PC gaming market?

Nvidia Corp.'s Tegra 4, the firm's latest SoC processor, gave the company a quarterly boost in Q3. Revenue was up 7.9 percent from $977.2 million in Q2 to $1,054 million in Q3, but remained down 12.5 percent YoY, revealed the company. Nvidia's Tegra processor business alone brought in $111.2 million Q3 revenue, representing a 111.4 percent rise over Q2, yet Tegra also remains down 54.4 percent YoY.

System on chip Tegra 4 went into volume shipments in Q3. "The sequential increase is largely related to Tegra 4," the company noted. Landing in China's Xiaomi Mi3 smartphone and mobile tablet Tegra Note, Tegra 4 was first introduced in SHIELD, Nvidia's handheld gaming device, which started shipping in volume in Q3 with Tegra 4 inside. Nvidia also saw increased sales in embedded and automotive SoC products sequentially, though only automotive sustained the YoY increase, accounting for 25 percent of Tegra 4 revenues. The company attributed the YoY decrease in SoC to lower volume shipments of Tegra 4 versus Tegra 3.

"Tegra 4 shipped in over 15 different mobile devices including Xiaomi, HP, Microsoft, Asus, Toshiba, Acer and others," said Rob Csongor Nvidia's VP of investor relations in an earnings conference call. "Android devices with Tegra this quarter included Asus' new 2500 x 1600 transformer convertible tablet, three new HP tablets and new Acer all-in-one PC, ViewSonic's new Android intelligent display and a number of Android microgame consoles."

Nvidia expects sales in automotive to increase. "From digital clusters to infotainment systems to, in the future, driver assistance, the car is going to be an opportunity for more than just one GPU," said Jen-Hsun Huang, Nvidia's president and CEO.

Nvidia's Q3 financial comparisons

The Tegra 4 has driven the firm's revenue to $1,054 million in Q3, up 7.9 percent from $977.2 million in Q2, but remained down 12.5 percent YoY.

The strength in PC gaming market offset any downward trend of the PC market for Nvidia's GPU chips. Higher-margin products GeForce GTX, Quadro and Tesla GPUs buoyed the gross margins, which clocked 55.4 percent in Q3. Graphic processing units brought in the largest chunk of revenue at $876.8 million for Q3, up 2.1 percent from Q2. Nvidia reported record revenue on Quadro and Tesla GPUs for servers and workstations, a slight increase in GeForce GPUs for desktop, but a decrease in GeForce GPU notebooks.

"A strong PC gaming market, together with record Quadro and Tesla results and the new type of revenues from Tegra 4 in new Android devices offset declines in mainstream PC units," said Csongor. "While the PC market overall declined nine percent YoY according to Gartner, Nvidia's year-to-date overall GP business is up four percent versus the same time period."


Nvidia's SHIELD gaming device one of first devices with Nvidia's Tegra 4 SoC. (Source: Nvidia).

Tegra 4i, Nvidia's first integrated LTE Tegra processor, is now certified with AT&T. It will ship no later than Q2, said Huang in the Q&A. "Tegra 4i projects are in development and that we expect unlikely to be announced in Q1 and ship no later than Q2." Nvidia is targeting the smartphone market outside the US.

"You really need to have CDMA in the US to be successful. And so we are not targeting [the] U.S. with respect to phones, we are targeting outside the U.S." Huang said.

- Susan Rambo
??EE Times

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