Nvidia Hamstrung By These Capacity Constraints
Strong demand for its newly introduced chips for desktops and contract orders for its new smartphone chips helped Nvidia Corp (NASDAQ:NVDA) post first-quarter revenues that topped analysts’ estimates, though earnings were in line.
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Revenues were $924.9 million and down from the $962 million last year, but much better than the $916 million anticipated by the Street.
Net earnings were $60.4 million (10 cents a share) compared to $135.2 million (22 cents a share) in the same period last year, and were in line with analysts’ forecasts.
The company’s profits and revenues were impacted by a capacity constraint for the manufacturing of its 28 nanometer graphics chips, and according to an executive, the company was missing out on “a lot” of sales, though no details were provided on the amount lost.
For the second quarter, Nvidia forecasts revenues of $990 million to $1.05 billion, compared to analysts’ expectations of $916 million. Gross margins are expected in the order of 51.2 percent, give or take a percent, slightly better than 50.1 percent earned in the first quarter.
Shares were up 8 percent this morning in early trading.
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