Nvidia reports a steady second quarter thanks to Tegra

CHIP DESIGNER Nvidia has recorded a slight increase in revenue for the second quarter of its 2012 fiscal year.

Nvidia, which runs its fiscal year one year ahead of the current calendar year, announced that for the second quarter of 2012 it rang up $1bn in sales, generating profit of $151.6m. Compared to the previous quarter both revenues and profits were up but more importantly gross margin increased to 51.7 per cent from 50.4 per cent in the previous quarter.

Jen-Hsun Huang, Nvidia president and CEO highlighted the firm's mobile chips for particular praise and said, "We grew solidly this quarter, consumer demand for notebooks powered by our GeForce GPU, with its unique Optimus technology, resulted in record revenue for these products. The future of computing is mobile and visual. With Tegra's momentum and our growing GPU businesses, we are ideally positioned to lead the industry forward."

Having given up on the embedded graphics market, Nvidia seems to be benefiting from the boom in tablet sales. Nvidia has also enjoyed considerable success in the high performance computing market with its Tesla boards powering some of the fastest supercomputing clusters in the Top 500 with several configurations on show at this year's International Supercomputing Conference.

Nvidia had endured a lacklustre start with its Tegra chips aimed at smartphones and tablets. The first widely available Tegra 2 device was LG's Optimus 2X at CES, and even now Tegra 2 seems to be favoured in tablets rather than smartphones. Nevertheless, the Tegra 2 chip has found its way into Samsung's Galaxy Tab 10.1, LG's Optimus Tab and Asus' Eee Pad Transformer.

Nvidia said it expects third quarter revenue to grow by four to six per cent, with gross margins to remain the same but expenses to rise by $10m to $15m. On the whole, it expects a steady third quarter too. µ