Summary
NVIDIA Corporation filed an 8-K on August 10, 2006, primarily to announce its second-quarter fiscal year 2007 results and to disclose a voluntary review of its stock option practices. The company reported record revenue for the second quarter ended July 30, 2006. However, this positive revenue news is overshadowed by the announcement that the Audit Committee is investigating past stock option grants for potential accounting errors regarding measurement dates. This review, conducted with outside legal counsel and voluntarily disclosed to the SEC, may result in additional non-cash stock-based compensation expense. The company also indicated that it anticipates a delay in filing its Form 10-Q for the second quarter due to this ongoing review.
Key Highlights
- 1NVIDIA reported record revenue for the second quarter of fiscal year 2007.
- 2The company is undertaking a voluntary review of its historical stock option grant practices.
- 3The review, led by the Audit Committee with external legal counsel, covers the period from the company's IPO in 1999 through the current fiscal year.
- 4Preliminary findings suggest incorrect measurement dates may have been used for stock option grants in prior periods.
- 5NVIDIA may incur additional non-cash stock-based compensation expense as a result of the review.
- 6The company anticipates a delay in filing its second-quarter Form 10-Q report.
- 7The stock option review does not impact the company's cash position or reported revenue for the current or past periods.
Frequently Asked Questions
NVIDIA reported record revenue for the second quarter of fiscal year 2007, ended July 30, 2006. A press release detailing these results was furnished with this 8-K filing.
The Audit Committee of NVIDIA's Board of Directors is conducting a voluntary review of the company's stock option practices from 1999 to the present fiscal year. This review was initiated due to concerns about potentially incorrect measurement dates used for financial accounting of stock option grants in certain prior periods.
The review may lead to NVIDIA recording additional non-cash stock-based compensation expense. However, this expense will not affect the company's cash position or its reported revenue for the current or prior periods.
NVIDIA does not expect to file its Form 10-Q for the second fiscal quarter by the original deadline of September 8, 2006, or the extended deadline of September 13, 2006, due to the ongoing stock option review.