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Storm clouds are gathering as NVIDIA faces a reinvigorated competitor

As the old saying goes, when it rains it pours.  NVIDIA was performing beautifully thanks to aggressive pricing and performance of its 8000 series of graphics cards.  It looked poised to leave competitor AMD (formerly ATI) in the dust.  However, the latest round in graphics war has marked a dramatic turnaround with AMD's 4850 and 4870 outperforming NVIDIA's offerings at a lower price

While NVIDIA still holds a tenuous grip on the highest end offerings, with its GeForce GTX 280 GPU, this might soon slip, depending on the performance of AMD's dual processor 4870 X2 (R700) card, likely coming in Q3 2008.  Meanwhile, NVIDIA faces challenges from Intel in its low-end and laptop graphics offerings, and from AMD's PUMA chipset/graphics package in the laptop market.

The economic repercussions of NVIDIA's slippage are already visible.  NVIDIA announced yesterday that it was going to turn in revenue of $875 million to $950 million for Q2 2008, which ends July 27.  This is significantly lower than the current analyst expectations of $1.1 billion.

That was not the end of the bad news from NVIDIA either.  It announced that it was facing a massive recall, due to overheating GPUs in notebook computers.  NVIDIA reported higher than average failures in both the laptop GPUs and in laptop chipsets.

NVIDIA said that the chips and their packaging were made with materials that proved to be too "weak".  NVIDIA passes the blame to notebook manufacturers, which it says contributes to the problem.  Typically notebooks have poorer ventilation and components concentrated in a smaller space than desktop computers.

The result of the recalls is that NVIDIA will be taking a onetime charge of $150M USD to $200M USD to cover the damages.  It plans to use the money to repair or replace defective parts.  It also hopes to collect part of the money from insurers it uses.  However, it has acknowledged its problems and switched the materials it uses.

The news has resulted in NVIDIA taking a beating on the stock market, sliding over 25 percent.

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By kilkennycat on 7/3/2008 7:42:15 PM , Rating: 2
The author of the Daily Tech must have copied that quote from somewhere else and never bothered to look at the original announcement on the nVidia web-site.

Here is the actual text of the statement from nV's CEO in the nVidia public announcement.

Regarding the notebook field failures, NVIDIA president and CEO Jen-Hsun Huang stated:-
"Although the failure appears related to the combination of the interaction between the chip material set and system design, we have a responsibility to our customers and will take our part in resolving this problem. The GPU has become an increasingly important part of the computing experience and we are seeing more interest by PC OEMs to adopt GPUs in more platforms. Recognizing that the GPU is one of the most complex processors in the system, it is critical that we now work more closely with notebook system designers and our chip foundries to ensure that the GPU and the system are designed collaboratively for the best performance and robustness "

And he also said:-
This has been a challenging experience for us. However, the lessons we've learned will help us build far more robust products in the future, and become a more valuable system design partner to our customers. As for the present, we have switched production to a more robust die/package material set and are working proactively with our OEM partners to develop system management software that will provide better thermal management to the GPU

Seems as if there is considerable "mea culpa" from Jen-Hsun here and only a little finger-pointing at the notebook manufacturers..... Considering the danger to one's reproductive capabilities that many high-performance laptops/notebooks exhibit, I personally think that placing at least some responsibility on the system manufacturers for adequate system-cooling is quite justified....

For the complete press-release see:-

By crystal clear on 7/6/2008 7:48:41 AM , Rating: 2
This was the same guy (I mean the CEO) who once said-

"We're going to open a can of whoop ass,"

He now becomes the joke of the industry.......

Well back again to AMD & Intel graphics ...Safe reliable & cheap(AMD)....

AMD couldnt ask for anything better than this,whilst INTEL has a good laugh & says-

"Intel inside everthing"

By crystal clear on 7/7/2008 6:29:25 AM , Rating: 2
Scanning through forums-I find this.......

See the picture !

Got Fried !
Jul 2 2008, 09:52 AM

A filing with the US Securities and Exchange Commission states the number of notebooks shipped and sold with the defect were in "significant quantities."

The above picture is just an example......there could be

"significant quantities." out there in the market.

In simple language there must be in their tens (or more) of thousands out there

"Got Fried" who dont post their....

fried eggs on forums.

Remember those exploding Dell laptops,now get ready for a meltdown.

"If you mod me down, I will become more insightful than you can possibly imagine." -- Slashdot

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