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10-QPeriod: Q3 FY2006

NVIDIA CORP Quarterly Report for Q3 Ended Oct 30, 2005

Filed November 23, 2005For Securities:NVDA

Summary

NVIDIA Corporation reported strong financial performance for the third quarter of fiscal year 2006, ending October 30, 2005. Revenue increased significantly year-over-year, demonstrating robust demand for its products. This top-line growth translated into substantial improvements in profitability, with net income more than doubling compared to the same period last year. The company's balance sheet remains healthy, characterized by a significant increase in cash and cash equivalents and a solid equity position. Key factors contributing to this performance include continued expansion in its core markets and effective cost management, although operating expenses saw a slight increase due to settlement costs. Investors should note the substantial growth in basic and diluted earnings per share, reflecting the improved profitability and efficient use of capital. NVIDIA's financial position supports ongoing investment in research and development, which is crucial for maintaining its competitive edge in the rapidly evolving technology sector.

Key Highlights

  • 1Revenue for the three months ended October 30, 2005, was $583.4 million, a significant increase compared to $515.6 million in the prior year's same quarter.
  • 2Net income surged to $65.3 million for the quarter, up from $25.9 million in the prior year's third quarter, indicating strong profit growth.
  • 3Basic net income per share rose to $0.38 from $0.16 in the prior year's comparable period, and diluted net income per share increased to $0.36 from $0.15.
  • 4The company's cash and cash equivalents more than doubled, reaching $364.3 million as of October 30, 2005, compared to $208.5 million at the start of the fiscal year, indicating strong cash generation.
  • 5Gross profit margin improved to 39.1% for the quarter, up from 32.3% in the prior year's quarter.
  • 6Goodwill on the balance sheet increased from $108.1 million to $133.1 million, suggesting potential acquisitions or strategic investments.
  • 7Operating expenses included $14.1 million in settlement costs for the three and nine months ended October 30, 2005, which impacted profitability.

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