NVIDIA reported results yesterday for the second fiscal quarter ended July 27. Revenue fell
For the second quarter of fiscal 2009, revenue decreased to $892.7 million compared to $935.3 million for the second quarter of fiscal 2008, a decrease of five percent.
Profit turned to loss (the company reported at $173M profit in the last Q2)
NVIDIA’s results for the second quarter of fiscal 2009, computed in accordance with U.S. generally accepted accounting principles (GAAP), included a net loss of $120.9 million, or a loss of $0.22 per share.
They produced faulty product
During the second quarter of fiscal 2009, NVIDIA recorded a $196 million charge against cost of revenue to cover anticipated customer warranty, repair, return, replacement and associated costs arising from a weak die/packaging material set in certain versions of our previous generation MCP and GPU products used in notebook systems.
And, as Jen-Hsun Huang, president and CEO of NVIDIA pointed out, had poor management execution
‘Our Q2 financial performance was disappointing. …And our miscalculation of competitive price position further pressured our desktop GPU business.’
So, technology and pressure from ATI/AMD, production flaws, and poor execution by management. Bad quarter indeed.