AMD/ATI hits Nvidia where it hurts
"Nvidia have recorded their first quarterly loss in six years."
Published: 13th August 2008 | Source: Nvidia |
It's a two horse race again!
It looks like AMD/ATI's recent regain in popularity within the discrete GPU market is starting to hurt Nvidia's profits, amongst other reasons. They have recorded a net loss of $120.9 million for the second quarter of this year. This is the first time in six years that Nvidia have recorded a quarterly loss.
Revenue decreased to $892.7 million compared to $935.3 million for the same period last year, a decrease of five percent. Due to problems with certain notebook GPU failures, the company also had to write off $196 million. There has also been a decline in demand for new GPU's. Nvidia have admitted that their pricing structuring prior to the release of the Radeon 4800 series was wrong and hurt their profits too.
Mr. Jen-Hsun Huang, president and CEO of Nvidia, said in a press statement:
"Our Q2 financial performance was disappointing. The desktop PC market around the world weakened during the quarter. And our miscalculation of competitive price position further pressured our desktop GPU business. We have a great product line-up and, having taken the necessary pricing actions, we are strongly positioned again. Our focus now is to drive cost improvements and to further enhance our competitiveness through the many exciting initiatives we have planned for the rest of the year, in contrast, the rest of our businesses did not exhibit the same dynamics as our desktop business. The notebook GPU, MCP, and Professional Solutions groups grew a combined 27 percent year-over year.