NVIDIA Warns on Revenues, Margins

Nvidia has announced that its revenues will be significantly lower than initially thought: $875M to $950M instead of $1.01B expected by the financial community. The company mentioned several problems that it faces: weak markets around the world, delay in the MCP line of products and competitive pressure on the GPU business. As a result, NVIDIA’s shares were down 21% during in after-hours (6:10pm PT). I personally think that competitive pressure in the GPU business is the thing that is the most worrisome. While AMD was working on a new chip, NVIDIA enjoyed great margins as the dominant player, but the new Radeon line up has to put a lot of pricing pressure. That would be the typical effect of a price war. I don’t want to sound like an alarmist, but Intel isn’t even in the enthusiast GPU party… yet.

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