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Windows RT is to blame for Nvidia’s poor second quarter revenues

Tegra revenue was $52.6 million, down 71 percent from last year
Fri Aug 09 2013, 14:42
microsoft-surface-tablet

CHIP DESIGNER Nvidia reported rather dismal sales of its Tegra mobile processor in the firm's second quarter financial results, and it's all because of Windows RT.

The California company said Tegra revenues were $52.6 million in the fiscal second quarter ended July 28, down 71 percent from the same quarter last year.

Discussing the figures in a conference call on Thursday, Nvidia CEO Jen-Hsun Huang said the decline in revenues was largely due to lower unit shipments of Tegra 3 processors as customers ramped down production of Tegra 3 based smartphones and tablets, but he also blamed Window's RT for the disappointing sales, though not directly.

"The decline comes from... coming into the year we had pretty high expectations on one particular platform and there's no sense mainly, but it's a very important platform that also derived from it a lot of design wins," he said.

"And because this particular platform just didn't do as well as we or frankly anybody in the industry had hoped, we don't expect as much return from the investment as we had hoped."

Although he didn't name the culprit "platform", the reference to Windows RT was pretty obvious.

Nvidia worked with Microsoft to make Windows RT run on Nvidia's Tegra 3 chips, which are based on the ARM Cortex A9 processor.

The news doesn't come as much of a shock, considering that Microsoft recently slashed the prices of its Surface RT tablets to try to clear out excess stock.

Microsoft's Surface RT tablets along with Asus' Vivotab RT were among the Windows RT tablets introduced with Tegra 3 chips. Lenovo's Ideapad Yoga 11 was also based on the Windows RT operating system, though it has already been pulled from the firm's website.

However, Nvidia said it is now focusing on ramping up production of its next generation processor, the Tegra 4, in anticipation of new devices from its customers in the second half of the year, such as the next generation Surface tablets. µ

 

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