Summary
NVIDIA Corporation's (NVDA) fiscal Q2 2014 report (ending July 27, 2013) shows a year-over-year revenue decline, primarily driven by a significant drop in the Tegra Processor business. While the GPU segment demonstrated growth, it was not enough to offset the overall revenue decrease. Net income also saw a decline compared to the prior year. The company continued its aggressive share repurchase program and initiated dividend payments, returning substantial capital to shareholders. Despite the revenue headwinds, NVIDIA increased its investment in research and development, indicating a focus on future product innovation, particularly in its core GPU business and emerging areas like visual computing appliances. The company's financial position remains strong with ample cash and marketable securities, though a portion was used to fund share repurchases. Investors should monitor the performance of the Tegra business and the company's ability to maintain growth in its GPU segment amidst ongoing competition.
Financial Highlights
54 data points| Revenue | $977.24M |
| Cost of Revenue | $431.70M |
| Gross Profit | $545.54M |
| R&D Expenses | $331.74M |
| SG&A Expenses | $108.27M |
| Operating Expenses | $440.00M |
| Operating Income | $105.53M |
| Interest Expense | $836K |
| Net Income | $96.45M |
| EPS (Basic) | $0.00 |
| EPS (Diluted) | $0.00 |
| Shares Outstanding (Basic) | 23.41B |
| Shares Outstanding (Diluted) | 23.68B |
Key Highlights
- 1Revenue decreased by 6.4% year-over-year to $977.2 million for the second quarter, and by 1.9% for the first half of the fiscal year.
- 2The GPU business revenue grew by 7.5% year-over-year in Q2 and 7.8% for the first half, driven by strong sales of high-end Kepler-based GeForce desktop products.
- 3The Tegra Processor business revenue declined significantly, down 70.7% in Q2 and 50.1% for the first half, due to lower sales of older generation processors.
- 4Net income for the quarter decreased to $96.4 million from $119.0 million in the prior year's comparable quarter.
- 5Research and development expenses increased by 18.0% year-over-year for the quarter, reflecting continued investment in future technologies.
- 6NVIDIA returned over $1 billion to shareholders in the first half of FY2014 through share repurchases ($100 million in Q1, $750 million ASR in Q2) and dividends ($89.6 million).
- 7The company had a strong liquidity position with $2.94 billion in cash, cash equivalents, and marketable securities as of July 28, 2013, though this was a decrease from the prior fiscal year-end due to share repurchases.