Wednesday, November 10, 2010

Nvidia Corp. (NASDAQ: NVDA): Q3 Earnings Preview 2010

Nvidia Corp. (NASDAQ: NVDA) is scheduled to release its fiscal first-quarter earnings after the market close on Thursday, November 11 2010. Analysts, on average, currently expect the company to report earnings of 14 cents a share on revenue of $843.37 million. In the year ago quarter, the company reported earnings of 19 cents per share on revenue of $903.21 million.

Nvidia Corporation provides visual computing technologies that generate interactive graphics on workstations, personal computers, game consoles, and mobile devices. NVIDIA serves the entertainment and consumer market with its GeForce graphics products, the professional design and visualization market with its Quadro graphics products, the computing market with its Tesla computing solutions products, and the mobile computing market with its Tegra system-on-a-chip products. 

In the preceding second quarter, the Santa Clara, California based company's net loss was $140.96 million or 25 cents a share, compared to a loss of $105.3 million or 19 cents a share in the year-ago quarter. On an adjusted basis, the company earned 3 cents a share in the latest quarter. Revenue increased to $811.2 million from $776.5 million in the same quarter last year. Analysts, on average, expected the company to report earnings of 11 cents a share on revenue of $837.26 million.Gross margin on a GAAP basis was 16.6%, down from 45.6% in the previous quarter and 20.2% in the year-earlier quarter. Gross margin was hurt by a net charge of $193.3 million related to weak die or packaging material set.

At its last earnings call in August, the company said that it expects third quarter revenue to grow 3 to 5 percent from prior quarter, implying revenue of $835.5 million to $851.8 million. GAAP gross margin is estimated to increase in the range of 46.5% to 47.5% for the third quarter.

The company has continued to introduce new products at regular intervals. Nvidia stands to benefit from growing demand for handheld devices like smartphones and tablets. The company's Tegra product, designed to serve the fast growing tablet PC market, is already gaining traction among manufacturers.

Among other developments, Nvidia in August reached a licensing agreement with Rambus (NASDAQ: RMBS) in which the latter granted Nvidia "a non-exclusive, non-transferable, worldwide license for certain memory controllers."

In terms of stock performance, Wynn shares have lost nearly 30 percent since the beginning of the year.

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