NVIDIA CORP Quarterly Report for Q2 Ended Jul 29, 2012

Summary

NVIDIA Corporation (NVDA) reported its financial results for the second quarter of fiscal year 2013, ending July 29, 2012. Total revenue for the quarter was $1.04 billion, a slight increase of 2.7% year-over-year, indicating stable demand for its core GPU business, driven by new Kepler architecture products. The company saw growth in its GPU business, particularly in high-end desktop and notebook segments, while the Consumer Products Business (CPB) also experienced an increase primarily due to strong Tegra 3 sales for tablets and smartphones. However, the Professional Solutions Business (PSB) saw a slight revenue decline, attributed to softening demand in European markets. Net income for the quarter was $119 million, a decrease from the prior year's $151.6 million, reflecting increased operating expenses, notably in Research and Development, which rose by 13.5% as the company continues to invest in new technologies. Despite the dip in net income, NVIDIA maintained a healthy gross margin of 51.8%, demonstrating its ability to manage product mix and costs effectively.

Key Highlights

• 1Total revenue for Q2 FY13 increased to $1.04 billion, up 2.7% from $1.02 billion in Q2 FY12.
• 2GPU business revenue grew 4.7% to $668.3 million, driven by strong sales of new Kepler-based products.
• 3Consumer Products Business (CPB) revenue increased 7.1% to $179.6 million, boosted by Tegra 3 sales in smartphones and tablets.
• 4Net income decreased to $119 million from $151.6 million in the prior year's quarter.
• 5Operating expenses increased significantly, with R&D up 13.5% to $281.2 million and SG&A up 15.8% to $119.9 million.
• 6Gross margin remained strong at 51.8%, consistent with the previous year's quarter.
• 7The company held $3.28 billion in cash, cash equivalents, and marketable securities as of July 29, 2012.

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