NVIDIA denies exit from core logic market

Saturday 02nd August 2008, 01:33:00 PM, written by Rys

NVIDIA, in email communication with the Tech Report, has denied it is leaving the PC core logic market after a news report by Digitimes claimed it was.

The original story, citing a confidential source at a Taiwanese mainboard vendor, claimed that the Californian company was set to get out of the core logic business completely, following a meeting with its mainboard partners not too long ago.

In email to TR, NVIDIA's head of PR for its platform products said that Digitimes' story was completely groundless.

Check out Tech Report's news item for the full email text and discussion.

Discuss on the forums

Tagging

nvidia ± tech, report, cyril, rocks, chipset, business, digitimes


Latest Thread Comments (2165 total)
Posted by silent_guy on Sunday, 21-Feb-10 00:03:38 UTC
Quoting v_rr
*Nvidia shares dip 9% on inventory buildup*
http://sanjose.bizjournals.com/sanjose/stories/2010/02/15/daily82.html?ana=yfcpc
...
You must have overlooked this part in the conference call transcript:
Quote
The inventory situation happened as a result of wafers that came in late in the quarter that we couldn't get through our backend process and then shipped to customers. And so the backend process includes [inaudible] and with the complexity of the GPUs these days, requires quite substantial battery to go along with it. And so we just couldn't get it through the backend to ship to customers. Customers were clamoring for parts all the way through the end of the quarter. So we will ship it to them as soon as we can, we just couldn't get it through the backend.

Posted by Sxotty on Sunday, 21-Feb-10 01:40:42 UTC
Quoting v_rr
*Nvidia shares dip 9% on inventory buildup*
http://sanjose.bizjournals.com/sanjose/stories/2010/02/15/daily82.html?ana=yfcpc

So they increase inventory by almost 20% from the highest profit quarter of the year (Q4) to the lowest (Q1).
So they shipped the cards but the cards weren't sold to costumers because they don't want them but nvidia ship them anyway. They are building a bubble.

On the other side ATI didn't have enought cards to supply so much demand so let's see how is going to be next 2 quarters.
What are they shipping? And who are they shipping to?

Posted by Squilliam on Sunday, 21-Feb-10 02:30:27 UTC
Quoting Sxotty
What are they shipping? And who are they shipping to?
I wonder if its got something to do with the 40nm production they used late last year for their low end 40nm chips? They could have done this in order to deny ATI the wafers they needed for higher production last year without actually having orders for those chips to fulfill.

Posted by Kaotik on Sunday, 21-Feb-10 02:35:46 UTC
Quoting Sxotty
What are they shipping? And who are they shipping to?
They're shipping crapload of 40nm GT2xx lowend chips, which at the moment are nothing but filling countles shelves on countless stores
They sold a lot of them too, and they're the sole reason nV managed to raise their market share, but regardless of that there's tons of them just lying on the shelves - from nVidia's point of view they're sold products, but in the end they're not sold.

Posted by silent_guy on Sunday, 21-Feb-10 03:26:48 UTC
Quoting Kaotik
..., but regardless of that there's tons of them just lying on the shelves - from nVidia's point of view they're sold products, but in the end they're not sold.
Sold products that aren't in consumers hands? That's what's generally called the channel inventory.

It's amazing the things you can find out by reading conference call transcripts:
Quote
Inventory days on hand were 60 at the end of the quarter. Inventory in the channel remains low at around five weeks.
and
Quote
If you look at our channel inventory, which is where we sell a lot of our vast majority of our desktop GeForce business, that channel inventory has been roughly stable throughout the year. It has been teetering in the three to four week range. We had a one-week uptick in that in the fourth quarter. This is probably the first sign we have seen of any uptick in channel inventory now this year. But we still consider that pretty modest, you know, certainly well below where it has been historically and as a result of even those low levels, we continue to have stock-out situations, which we try to obviously avoid. So right now, I don't think we have got really any indicators that would tell us that we have got an inventory build going on, either in the channel or even at the OEM companies that we sell to.

Posted by Jawed on Sunday, 21-Feb-10 10:03:04 UTC
Quoting silent_guy
Sold products that aren't in consumers hands? That's what's generally called the channel inventory.
The channel ends once it leaves the AIB's hands (i.e. is purchased by a retailer), as NVidia doesn't sell consumer cards to the public. Jawed

Posted by silent_guy on Sunday, 21-Feb-10 10:36:14 UTC
Quoting Jawed
The channel ends once it leaves the AIB's hands (i.e. is purchased by a retailer), as NVidia doesn't sell consumer cards to the public.
No, the channel consists of all the parts that have not reached their final destination, the consumer, after they have been sold by the initial producer (i.e. Nvidia). That is, all the parts in the pipeline over which they have no control and limited visibility. A box with a GT250 on the shelf of Fry's is part of channel inventory. This doesn't affect the bottom line in anyway, but too much of it can result in excess inventory in the longer term if demand suddenly drops (due to the 3 month or so lead time in wafer starts.)

Posted by Jawed on Sunday, 21-Feb-10 13:07:48 UTC
OK, the channel inventory NVidia can discuss with analysts ends with what leaves its customers' hands. Someone's still selling FX5200s: http://www.google.com/products/catalog?q=geforce+fx5200&hl=en&cid=14852880162739718024&sa=title&os=sellers I wonder if NVidia is still selling those? Jawed

Posted by silent_guy on Sunday, 21-Feb-10 17:41:09 UTC
The danger about the channel is about sudden drops in channel velocity. A product like FX5200 already has a velocity of 0, so it doesn't matter.

Posted by trinibwoy on Wednesday, 24-Feb-10 00:00:52 UTC
Nvidia just can't catch a break.
Quote
Also this month, the Thai government said a similar device, the GT200, failed rigorous tests carried out by scientists and the army in Thailand. The government said it was looking into the possibility of legal action against its manufacturer.
http://www.cnn.com/2010/WORLD/meast/02/23/iraq.bomb.detectors/index.html?hpt=T2 *GT200 the bomb detector, not the GPU*


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