NVIDIA Soars Despite 'Disappointing' Quarter

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Market Watch analyzes NVIDIA’s recent 10% stock jump despite the fact the company had a disappointing quarter, posting its first quarterly loss in years. Analyst point to the fact that NVIDIA has announced another stock buy-back plan and has projected of a slight boost in sales and gross margins.

Company CEO Jen-Hsun Huang painted a grim picture for demand for the quarter, which complicated what he described as the graphics chip company's "miscalculation."
"Our second financial performance was disappointing," Huang said in a prepared statement. "The desktop PC market around the world weakened during the quarter. And our miscalculation of competitive price position further pressured our desktop graphics processor."
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Not everyone is convinced by NVIDIA’s one billion dollar stock buy-back plan, especially in light of the fact that the company has not complete its last billion dollar buy back plan (video).
 
Who is this joker and why is he yelling at his wife?

Cuda has enormous potential, nVidia isn't going to be out of business anytime soon.

 
CUDA means jack for Joe Consumer.

I liked that Huang admitted to underestimating ATI:
"We underestimated the price performance of our competitor’s most recent GPU, which led us to mis-position our fall lineup. The first step of our response was to reset our price to reflect competitive realities. Our action put us again in a strong competitive position but we took hard hits with respect to our overall GPU ASPs and ultimately to our gross margins. The price action was particularly difficult since we are just ramping 55-nanometer and the weak market resulted in taking longer than expected to work through our 65-nanometer inventory."
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Explains the pricing and their 8800 series pushing & rebranding. I have good hopes for graphics future now
 
OkToBeR[hocp];1032889924 said:
This sinking ship needs lots of holes plugged and they're running out of fingers to use. :rolleyes:
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They still have over a billion dollars in CASH money on hand (which I guess is being used to buy back stock, not a luxury AMD or ATi have had in recent memory. They are still way in the black, but I am surprised that their stock jumped up after nvidia posting a loss, investors must think the loss was only temporary.
 
OkToBeR[hocp];1032889924 said:
This sinking ship needs lots of holes plugged and they're running out of fingers to use. :rolleyes:
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And ATi/AMD doesn't/didn't have its own holes?
 
That video is proof that the internet is not living up to its potential.
 
Great Video.

It illustrates the point that this "announcement" of a stock buy back is only a stop-gap measure (especially since Nvidia hasn't completed their last announced buyback:rolleyes:), and any investor that believes it is only falling for Nvidia's game.


That being said, I still want Nvidia to pull out of this slump. I believe they will eventually.
 
alg7_munif said:
I found this interesting video regarding their stock buyback program.
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How deep was the barrel you scraped to dig that up? Besides misrepresenting nvidia's stock buyback program, there's nothing left but moronic analysis. You're starting to make a lot more sense now in light of that. I hope you didn't get squeezed to hard. :p

nvidia has been filing for additional stock buyback purchases since it was started in 2004. It was always a slow purchase plan and it has always worked by adding more to the buyback program even when there was a "balance." For example, in the first 19 months of the plan, nvidia filed to buy back $700 million of stock, but had only completed a little over $260 million of it. Since then nvidia has continued to add more, and complete more at its own pace. It's absolutely moronic to analyze nvidia's cash in light of the slow schedule of buybacks as if it's a one time immediate purchase. It has never worked that way. :rolleyes:
 
Anybody else wonder if a large scale sell-off of stock is now emminent by the upper management? Given the silence of the company on its mobile GPU issues, I can only imagine its was to give themselves time to spiff up their resumes and find new jobs before the cr*p hit the fan. Only thing left was to dump their stock, but in was in the doldrums. Spending the last bits of the companies onhand cash to boost the stock price looks like a smart move.

But then again, I don't have much respect for people anymore.
 
ATI/AMD Stock is down 30% selling for $5
Nvidia is selling @ $13 /share 66% less than a year ago
Seems the only one winning is Intel only 8% less than a year ago

Tech stocks aren't a great investment right now, unless the economy changes some.
 
Come to think of it as wild as it may sound Nvidia and ATI make great products they should stop eating each others profit margins and raise the prices of graphics card. The $200 card they are pumping really could be sold for $300 etc. I really don't like news like AMD or Nvidia falling apart, going bankrupt etc.

Who is ready for intel graphics :D
 
FootFungus said:
Given the silence of the company on its mobile GPU issues,
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nvidia hasn't been silent. They had announced the problem before the quarter closed, explained the scope of the problem and funds reserved to handle it, filed it in the last financial reports and answered analysts' questions about it. Further, they've officially denied the ridiculous lies that Charlie decides to spread. Exactly what are you expecting to hear? I'm not sure nvidia can broadcast through a foot of sand to satisfy everyone. ;)
 
SpAmBuRgErLoRd said:
The $200 card they are pumping really could be sold for $300 etc.
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You're joking, right?

What do you suggest they charge for their 800 dollar cards...1200?

These jokers have confused and misled consumers for years with their deceptive product naming schemes, planned obsolesence, etc...they have been milking the enthusiast crowd for YEARS.

Time for some new players, these guys need to be retired.
 
FootFungus said:
Anybody else wonder if a large scale sell-off of stock is now emminent by the upper management? Given the silence of the company on its mobile GPU issues, I can only imagine its was to give themselves time to spiff up their resumes and find new jobs before the cr*p hit the fan. Only thing left was to dump their stock, but in was in the doldrums. Spending the last bits of the companies onhand cash to boost the stock price looks like a smart move.

But then again, I don't have much respect for people anymore.
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While a few people might be seeking new employers for this little screwup with the 200 series, and the recalls, Nvidia itself is not going anywhere. They have a solid company, large cash reserves and the 200 series is nothing like the FX debacle. So long as they get the ball rolling on 55nm in reasonable amount of time this will be little more than a short detour as far as the gpu side of their business is concerned.
Their chip set prospects are not looking so good to me right now, but that never was the core of their business, gpu's are. So their stock might wobble for the next few months b4 settling at the corrected price. When your stock already over valued (just my opinion), a run of bad news can really mess your stock prices up, down, and all around for a bit.
 
AMD posted a loss of $1.19 billion nearly 10 times that of NVIDIA and their stock price went from $40 before buying ATI to around $5 today, just to put things in perspective a bit.
 
KingPariah777 said:
Time for some new players, these guys need to be retired.
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Okay, Say nivdia ceases to exist tomorrow, (which by the sound of your post, you want) whos going to be left? ATi? who is doing okay today, but who is a " wholly owned subsidiary" of AMD who payed 5.4 billion dollars for AMD, much of it still owed, who devalued the worth of ATi 3 times. That probably wouldn't of happened if ATi was going strong like it is today, and it was 2-3 years ago, but they got out developed by nvidia, not only where they a day late, but a dollar short. but today ATi is looking good. But today AMD looks like crap (people who own the rights to ATi) and it takes more money to operate AMD than it ever did to run ATi, and I don't know if you know this, the CPU market is also a two pony show, much like the GPU market, but it isn't as pretty. Point is, AMD is a real living sinking ship of a company, with no relief in sight, zero. So IF AMD fails, ATi is ether broken, or a shell of itself, because its earnings are AMDs earnings, its losses are AMDs losses, its future is with AMD (unless they somehow split)

And with ATi being left, there is intel, who is not at the moment in the discrete GPU market, but even right now, they are outspending ATi and nvidia to develop their own GPU, using x86 technology, now we have no idea how it will perform actually playing games, but intel has the capital to make something like this work, and work well, and if it works well, sell it for cheap, which is a strategy that has been working good for ATi, better than it has for AMD, but unlike ATi, they own their own fabs, infact many fabs, so volume production wouldn't be a problem for them, basically what I am saying is, don't worry about intel's position in the market, they can worry about it for themselves, because they are in that position.

So who the fuck else is there in the market? to produce discrete GPUs which render graphics for games? Exactly, all the other graphics companies died out or got bought up before the tech bubble burst. And it costs too much money to start out from square one for most tech companies, and there is very little payoff until you make a product, that is an is an absolute winner.

Whoever said that they should sell 200 dollar video cards for 300 dollars is right, They would stand to make alot more money, and to be honest, they wouldn't loose much if any business. They sold quality gaming cards that "enthusiasts" would pay 300 dollars for. They also sold cards for 200 dollars, and cards for 100 dollars, and cards for 80 and 60 and so forth. and 2 years ago 200 dollars bought you much much less than it will today, and in no small thanks to ATi, but effectively what they did, was cut into their margins, in order to make a profit, short term that works, long term its tough.

IF ATi sold their 4850 at 300, NV selling the 9800GTX+ for 300, with the 4870/260 at 400, the 280 at 500(550) and the 4870x2 being the top card, at 650-700, the level of performance would still justify the price structure, Thats how the prices of video cards looked 2-3 years ago when the 7900GTX and the x1900 series reigned supreme, but thanks to nvidia's one sided market dominance over the course of an entire year, and to the economy, nether nvidia nor ATi can reap the profits they once did, with the old prices they once sold their cards for. And the PC gaming market is a resilient market, most people who could deal with the 300 to 350 dollar price of a 6800GT in 2005 could deal with that same price say if a 4850, because it is the sweetspot of performance relative to parts costing less and more than it.

But ATi and nvidia aren't smart (or stupid, however you look at it) to do something like that, and I wouldn't suggest raising the price of the 4850 to 300 overnight verbatim, I meant in the future.
 
pxc said:
How deep was the barrel you scraped to dig that up? Besides misrepresenting nvidia's stock buyback program, there's nothing left but moronic analysis. You're starting to make a lot more sense now in light of that. I hope you didn't get squeezed to hard. :p

nvidia has been filing for additional stock buyback purchases since it was started in 2004. It was always a slow purchase plan and it has always worked by adding more to the buyback program even when there was a "balance." For example, in the first 19 months of the plan, nvidia filed to buy back $700 million of stock, but had only completed a little over $260 million of it. Since then nvidia has continued to add more, and complete more at its own pace. It's absolutely moronic to analyze nvidia's cash in light of the slow schedule of buybacks as if it's a one time immediate purchase. It has never worked that way. :rolleyes:
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Lol, what are attacking me for? I'm just posting what I found on the internet. The guy in the video has a point though, nVidia has only completed around $260 million of the earlier $700 million buyback program but now they add another $1 billion to the amount. I know it won't happen in an instant but what will happen when they report another bad quarter? Another announcement of a buyback program worth of $2 billion?
 
The press in general has gotten lazy in every sector. The computer press is just catching up in that regard. They report just the info they are told, and ask no questions, scrutinize, or read between the lines. Nvidia can be silent right now because the only person asking questions is coming off with a personal vendetta in his writings. Easy just to say that person is a crazy, move on, nothing to see here.

That wouldn't be a problem if it weren't for the fact, every recent annoncement since the GT280 has been either CUDA or PhysX. Most successful companies cease to be so when they lose focus. AMD did it, and is hanging on by their teeth. After years of pushing inferior chips (P4) Intel was lucky enough to dump all those Comms businesses they bought for too much money, then never used and destroyed. To me it looks like Nvidia is in the same boat. I'm not surprised their GPU's might have problems, as it looks like they are dividing their focus.
 
The "new" stock buy back program was announced 3 days ago, that they have only completed a small fraction of the last 1 sounds fishy to me. NV is not in any real trouble as they are sitting on a big pile of cash. There is however something many people have overlooked and that is that besides HP and Dell notebooks, a bunch of Macbooks also use the defective GPUs.
 
Simpson5774 said:
Okay, Say nivdia ceases to exist tomorrow, (which by the sound of your post, you want) whos going to be left?
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You're right new, companies with new ideas and business models would never show up :rolleyes: People stop thinking, innovating and investing after a huge dinosaur business dies, right? :p
 
FootFungus said:
Anybody else wonder if a large scale sell-off of stock is now emminent by the upper management? Given the silence of the company on its mobile GPU issues, I can only imagine its was to give themselves time to spiff up their resumes and find new jobs before the cr*p hit the fan. Only thing left was to dump their stock, but in was in the doldrums. Spending the last bits of the companies onhand cash to boost the stock price looks like a smart move.

But then again, I don't have much respect for people anymore.
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They would end up in jail since thats a felony
 
Felony? Jail? You really have to be stupid or hire a bad lawyer these days to end up in jail on a non-violoent crime. Likely, they'll cash in their stock, net a few million and then get fined a half a million. When was the last time you heard of an exec going to prison for insider trading, besides Martha Stuart (she doesn't seem stupid, so I assume it was the bad lawyer)?
 
Simpson5774 said:
They still have over a billion dollars in CASH money on hand (which I guess is being used to buy back stock, not a luxury AMD or ATi have had in recent memory. They are still way in the black, but I am surprised that their stock jumped up after nvidia posting a loss, investors must think the loss was only temporary.
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And 1.4.bn in debt.

assets-liabilities == 0 or so. They have NOTHING.
 
srangara said:
Buy low, sell high, buddy.
Somewhere in Dorval, a Matrox exec rubs his hands gleefully: "Soon... soon we will unleash the Illudium Q-36 Space Modulator!"
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Matrox Millenium XVIII FTW!

Pros: Crysis at 1920x1280 16xAA 60fps
Cons: VL Bus.

:D
 
KingPariah777 said:
You're right new, companies with new ideas and business models would never show up :rolleyes: People stop thinking, innovating and investing after a huge dinosaur business dies, right? :p
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Nvidia spend over a billion dollars a year in R&D every year (probably close to the same as ATi), And that is creating new products from existing products, or designing completely new ones. The fact is nvidia and ATi has pioneered the discrete graphics card market as we know it today, and these are the only two who can compete at this kind of level (save for intel in 09), look at matrox, they made discrete graphics cards, but they never had the kind of capital nvidia or ATi have to create something new, and they pretty much died off, and no they are not poised to make any kind of return.

Who do you think could come into the discrete graphics market, and have ANY kind of effect in the next 5 years amusing the money is there (and not intel, because they have had to work tirelessly for years now to get themselves to a position to get into the market, and they are still not even in the market)

ianken said:
And 1.4.bn in debt.

assets-liabilities == 0 or so. They have NOTHING.
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Sources please?
 
Will you people please wake up?

If a stock jumps after posting a loss, it means that the market had priced in a worse loss than was expected. This isn't rocket science.
 
vengence said:
Will you people please wake up?

If a stock jumps after posting a loss, it means that the market had priced in a worse loss than was expected. This isn't rocket science.
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True, when your stock is riding high, and you stumble, your stock tends to get undervalued for a bit, b4 settling at the corrected price. I try to stay out of tech stocks since, except Intel and a very few others, they tend to either under perform or over perform and then have super sized corrections. But last week was prolly a good time to buy Nv stock.
 
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