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NVIDIA Reports Record Results for Fourth Quarter and Fiscal Year 2006

 
 

NVIDIA Corporation:

Adam Foat Product PR Manager, UK and Northern Europe
NVIDIA Ltd
afoat@nvidia.com
+44 (0)118 903 3019

Press Relations:

James Delves
Wildfire PR
Tel: +44 (0)20 8339 4426
nvidia@wildfirepr.co.uk

FOR IMMEDIATE RELEASE

NVIDIA Reports Record Results for Fourth Quarter and Fiscal Year 2006

Company Achieves Record Annual Revenue; Annual Net Income Increases 202 Percent Year-Over-Year

THEALE, ENGLAND -FEBRUARY 17, 2006-NVIDIA Corporation (Nasdaq: NVDA) today reported financial results for the fourth quarter of fiscal 2006 and the fiscal year ended January 29, 2006.

For the fourth quarter of fiscal 2006, revenue was $633.6 million, compared to $566.5 million for the fourth quarter of fiscal 2005, an increase of 12 percent. Operating income for the fourth quarter of fiscal 2006 experienced 97 percent growth to $112.3 million, compared to operating income of $57.2 million for the fourth quarter of fiscal 2005. Net income for the fourth quarter of fiscal 2006 was $98.1 million, or $0.53 per diluted share, compared to net income of $48.0 million, or $0.27 per diluted share, for the fourth quarter of fiscal 2005, a net income increase of 104 percent.

Revenue for the fiscal year ended January 29, 2006 was a record $2.38 billion, compared to revenue of $2.01 billion for the fiscal year ended January 30, 2005. Net income for the fiscal year ended January 29, 2006 was $302.6 million, or $1.65 per diluted share, compared to net income of $100.4 million, or $0.57 per diluted share, for the fiscal year ended January 30, 2005, a net income increase of 202 percent.

"Fiscal 2006 was a milestone year for NVIDIA," stated Jen-Hsun Huang, president and CEO at NVIDIA. "We led the GPU and core logic industry on every front - technology leadership, product innovation, and operational excellence. As a result, we delivered record annual results for revenue, operating income, operating margin, and operating cash flow."

"Looking ahead into fiscal 2007, multiple important trends will create substantial growth opportunities in our target markets - HD DVD and Blu-ray high definition video, Microsoft Windows Vista, the 3G ramp and increasing multimedia content for mobile devices, and next generation game consoles. We have aligned ourselves with these exciting new growth drivers and are well positioned to have another strong year."

Fourth Quarter Fiscal 2006 and Recent Highlights:

  • Gross margin improved to 40.2 percent, an increase of 110 basis points sequentially from the third quarter fiscal 2006, and 600 basis points year-over-year.
  • NVIDIA increased its leadership share position in the desktop graphics processing unit (GPU) segment to 51 percent share, according to the Mercury Research Fourth Quarter 2005 PC Graphics Report.
  • NVIDIA shipped the NVIDIA nForce® 4 SLI XE and NVIDIA nForce4 Ultra Intel media and communications processors (MCPs). They represent the Company's first discrete chipsets targeted at mainstream Intel-based motherboards. NVIDIA nForce MCP revenue for the fourth quarter of fiscal 2006 increased 83 percent year-over-year and has achieved record revenue for six consecutive quarters.
  • NVIDIA and Dell showcased the first ever Quad SLI™ PC - the Dimension XPS Renegade - at the Consumer Electronics Show (CES) 2006, and earned the "Best of CES 2006" award for gaming.
  • The NVIDIA Quadro® professional product line increased its revenue 42 percent from the fourth quarter fiscal 2005 and again achieved record revenue.
  • NVIDIA introduced three new notebook GPUs - the GeForce® Go 7800, GeForce Go 7600 and GeForce Go 7400 - with leading tier one and system builders worldwide.
  • NVIDIA shipped two new GeForce 7 desktop GPUs - the GeForce 7800 GTX 512 and GeForce 7300 GS - for the enthusiast and mainstream desktop PC segments.
  • NVIDIA announced its intent to acquire ULi Electronics Inc., one of the PC industry's most highly-regarded core logic developers.
  • NVIDIA announced that NVIDIA Quadro professional graphics will offer Adobe users direct GPU acceleration capabilities that increase application performance and video editing workflow for Adobe Product Studio. As a member of the Adobe OpenHD Alliance, NVIDIA is working with the industry to develop tools and technologies that enhance the productivity of HD video creation.
  • NVIDIA unveiled the NVIDIA GoForce® 5500 handheld GPU, the industry's first handheld GPU to enable true, DVD-quality video, full H.264 processing for fluid digital TV, high-fidelity surround sound, rapid multi-shot photography, and console-class 3D graphics. Phones based on the NVIDIA GoForce 5500 handheld GPU are expected to be available from key handset manufacturers before the 2006 holiday season.

To listen to a Web cast regarding the fourth quarter fiscal 2006 financial results and current financial prospects, please visit the NVIDIA investor relations Web site www.nvidia.co.uk/ir and at http://www.streetevents.com. The Web cast will be recorded and available for replay until the Company's conference call to discuss its financial results for its first quarter fiscal 2007.

About NVIDIA
NVIDIA Corporation is a market leader in visual computing technology dedicated to creating products that enhance the interactive experience on consumer and professional computing platforms. Its graphics and communications processors have broad market reach and are incorporated into a wide variety of computing platforms, including consumer digital-media PCs, enterprise PCs, professional workstations, digital content creation systems, notebook PCs, military navigation systems and video game consoles. NVIDIA is headquartered in Santa Clara, California and employs more than 2,000 people worldwide. For more information, visit the Company’s Web site at www.nvidia.co.uk.

Certain statements in this press release, including any statements relating to the Company's performance expectations for NVIDIA's family of products and expectations of continued revenue growth, are forward-looking statements that are subject to risks and uncertainties that could cause results to be materially different than expectations. Such risks and uncertainties include, but are not limited to, manufacturing and other delays relating to new products, difficulties in the fabrication process and dependence of the Company on third-party manufacturers, general industry trends including cyclical trends in the PC and semiconductor industries, the impact of competitive products and pricing alternatives, market acceptance of the Company's new products and the Company's dependence on third-party developers and publishers. Investors are advised to read the Company's Annual Report on Form 10-K and quarterly reports on Form 10-Q filed with the Securities and Exchange Commission, particularly those sections entitled "Certain Business Risks," for a fuller discussion of these and other risks and uncertainties.

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