Close, it was 270 million (for all GPU related revenue) according to

http://biz.yahoo.com/bw/090122/20090122006129.html?.v=1

So it's still far behind Nvidia (at 481.1 million), but not by as much as I was thinking. Also considering this revenue includes all of Nvidia's revenue (chipsets, etc). Not sure how much of that is purely Nvidia's GPU revenue.

Still. GPU down 47% for Nvidia, ouch. Is that quarter to quarter or year to year? Looks like that's compared to Q4 of 2007.

Compared to ATI (again all of AMD's gpu revenue) 8% down from Q4 of 2007.

You can see the little price war has hurt Nvidia's bottom line more. But at least they were able to stop the marketshare bleeding and regain some position last quarter.

Is Nvidia expecting to pull out a trump card or expecting AMD to let up the price pressure? I'm not sure why they are so rosy right now about margins going back up to the mid-30's just yet.

Ah, ok looked some more. It looks like they are predicting ION will bring up their overall margins. I guess this all depends on how competitive Poulsbo (did I get that right?) is in power consumption and video acceleration.

Hmmm, further. Workstations took a dive? I wonder how this compares to ATI FireGL uptake.

Regards,
SB

Haven't seen the breakdown for Q4, but using the Q3 numbers ( http://www.xbitlabs.com/news/video/display/20090113111639_Sales_of_Graphics_Cards_Chipsets_Collapse_Nvidia_Announces_Unprecedented_Declines_in_Sales.html ) gives something like:GPU: 244Pro: 111MCP: 97Consumer/other: 29The 270 mill AMD GPG is not including the MCP/IGPs, so it's more like 270 vs 355, and IIRC nvidia has 70-80% of the Pro market, making the radeon/geforce revenue almost equal.

The large inventory NVidia built up appears to have reduced gross margin by 8-10%. As NVidia has stopped wafter starts (don't know when the stop was activated, though) inventory will fall. Also, they expect the channel to start buying again (as channel inventory has cleared after NVidia stuffed it beyond bursting point last autumn). The combination of the two is a radical reduction in inventory. So that, alone, will help margin. What's interesting is that some parts of their current inventory look destined to last into FY2010Q3, i.e. August or later :shock: I don't think Ion (that is Ion in Atom PCs, not "Ion" which is that chipset in any PC/Mac whether it has an Atom or not) will have a material effect until FY2010Q3. Jawed

Looking at what we know that we now know, and a lot of other people now know that they know:

"Our ASP’s were generally flat this quarter. And so from that you could argue that people are not buying down per se. There is a very significant factor that is happening in the notebook segment however. There’s the surge of the net book market and you could characterize the net book market as low end. And if I were to just for the sake of my description right now describe the market as high, mid and low our participation in the notebook market has been by and large about the upper half of mid and most of high. And we have no participation historically in the lower part of mid and the low end market".

Interesting that the decline was so flat across the board, with the exception of the heavier loss in discrete notebook sales. Guess they are hoping to offset with Ion to some extent, pretty sure Ion margins at the mid 30s are lower than the previous notebook gpus though. The pressure on Ion to deliver is tremendous. If intel gets its its MCM chips with inbuilt G45 out on time in Q4 is going to be really hard.

[On low cost or netbook PCs]
"I think what’s going to happen is that the low end part of the marketplace is going to cannibalize the mid-range part of the market. And people who want performance still will go for performance. The net book will hardly serve their needs. But for a lot of people in the mid-range part of the marketplace the net book is clearly, clearly going to disrupt that."

So to map that, they are going to put Ion and mid low end GPUs on the desktop plus one performance part perhaps. ie Ion, GT218, GT216 plus performance GT215 as their 40nm chips. Wondering about the current strategy of creating a monster performance part and having it slowly trickle down to mainstream if there is now a big gap between the 2 gpu markets.

I think this is pure bullshit. If the channel is stuffed and the only thing it bought was GT200b, then how the hell are their ASPs a reflection of consumer sentiment, which is one step removed from the channel? Meanwhile, they're planning to spend as much as $150M buying back options off staff: http://www.reuters.com/article/rbssTechMediaTelecomNews/idUSN1138961420090211 Maybe it's a neat trick: get the staff to refuse the offer, because by doing so they "pitch-in" and help the company weather the storm :???: Am I being too cynical? Jawed

If the buy-back price is significantly lower than the current stock price (which is 99% certain), then a different way to look at it is that it's a much cheaper way than stock buy-backs to reduce the diluted amount of outstanding shares. (Which is the number required by GAAP to calculate profit or loss per share.)

One can question if it's smarter to do stock buybacks than to pay out a dividend, but in a Silicon Valley environment where stock options are a very significant factor wrt compensation, a company doesn't have much choice. If the stock recovers, a stock option buy back is cheaper than a stock buy backs, so the former is a lesser evil.

BTW, it's not always an obvious decision to accept such an offer or not. People often tend to have optimistic expectation about a stock going back to where it used to be not so long ago...

http://yahoo.brand.edgar-online.com/DisplayFiling.aspx?TabIndex=2&FilingID=6398963&companyid=4967

$150M is more than 10% of their cash and cash equivalents - why are they spending anything on stock buy back right now? They made a song and dance about $35M reduction in OpEx per quarter. Well they've just blown >4 quarters of that saving, if everyone sells back their options. In this case >$17.50 is looking like a very distant prospect and >$28 ? Crudely put the buy back is $10s of thousands per employee. Jawed

To my inexperienced investor's eye, the offer to buyback options from employees looks moderately generous, especially when you look at the cost on the open market to buy call options.According to yahoo finance, Jan 2011 $25.00 call options have a bid/ask of 0.35/0.50. Maybe if you were an nVidia employee, you would take the company on their offer and just buy calls.

This is not really a surprise. If a company offers to buy-back stock options for whatever reason, they have to be at least a bit above the Black-Scholes price, otherwise it isn't much of an incentive for employees to accept them (they have Excel spreadsheets too. :wink:)

Most companies prohibit employees from buying open market options of their own company's stock. (Especially puts, to the chagrin of many during the dot-com bubble, when it would have been a great way to lock in outsized profits on unvested call options.)

Anyway, whether or not it's smart to use cash on such a buyback is another question. 5 years back, with options not having an accounting cost, companies would just have repriced them to a lower level. A much better deal for employees and the company itself. Less so for stock holders...