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NVIDIA Admits to Selling Faulty Mobile GPUs, Shares Plummet

Discussion in 'News' started by btarunr, Jul 3, 2008.

  1. btarunr

    btarunr Editor & Senior Moderator Staff Member

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    NVIDIA Admits to Selling Faulty Mobile GPUs, Could Cost it up to $200 M

    NVIDIA admits that some of its notebook graphics processors are failing at “higher than normal rates”, in a filing with the Securities and Exchange Commission. These chip failures will cost NVIDIA anywhere between 150 and 200 million US Dollars this quarter financial year toward warranty, repair, return and replacement for laptops with such NVIDIA products incorporated.

    Nvidia says that “significant quantities” of chips are experiencing thermal issues caused by possibly weak die and packaging – in essence the parts are overheating and failing, while not pointing out exactly which laptop models are affected by this. As an immediate response, NVIDIA prepared an emergency driver that maintains the fan cooling speed higher than original parameters. Expect the notebook to be noisier.

    NVIDIA had announced yesterday that they were looking at a Q2 revenue falling more in the range of $875 million to $950 million contradicting analysts' speculation of a $1.1 billion figure. Repercussions soon followed at the Nasdaq, where the NVIDIA stock plunged 21.94 per cent or $3.95 to $14.08 a share.

    Shareholders can get some respite from NVIDIA's recent press release which says that the company is seeking insurance to cover the costs incured with the issue of the failing notebook computer components. Says the press release:

    You can read the complete press release by NVIDIA here.



    Sources: TG Daily, NVIDIA
    Last edited: Jul 3, 2008
  2. lemonadesoda

    lemonadesoda

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    WAIT

    nVidia admits that it has discovered that some of the mobile GPUs it sold have a high failure rate.

    That is very different from admitting to selling faulty GPUs.
    CDdude55, pt and newtekie1 say thanks.
  3. Easy Rhino

    Easy Rhino Linux Advocate

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    man i would hate to be the guy in charge of mobile gpus at nvidia! things just havnt been going their way lately.
  4. lemonadesoda

    lemonadesoda

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    Bad luck comes in threes...
  5. Easy Rhino

    Easy Rhino Linux Advocate

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    true. so what are the other two?
  6. xfire

    xfire New Member

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    ATI and Intel :)
  7. Easy Rhino

    Easy Rhino Linux Advocate

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    :laugh: nice :laugh: :slap:
    tkpenalty says thanks.
  8. xfire

    xfire New Member

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    Mobile GPU unit :slap: -> Nvidia
    Intel:laugh:
    ATI rakes the money.
  9. Easy Rhino

    Easy Rhino Linux Advocate

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    yea, ATI is definately feeling :pimp: right now
  10. laszlo

    laszlo

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  11. lemonadesoda

    lemonadesoda

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    News is right. Price dropped to $14 after NASDAQ closed (so called after-hours trading). Just look at the opening prices when NASDAQ comes back on line.
  12. Easy Rhino

    Easy Rhino Linux Advocate

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  13. xfire

    xfire New Member

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    right time to buy Nvidia and ATI shares.
  14. lemonadesoda

    lemonadesoda

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    Does this help?

    [​IMG]
    tkpenalty and Easy Rhino say thanks.
  15. xfire

    xfire New Member

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  16. Easy Rhino

    Easy Rhino Linux Advocate

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    good call, i didnt see that. check out the 5 year chart for nvidia. the highest they reached was during the announcement of their targetting of intel for intergrated graphics chips in october 07. since then it has been a steady decline.
  17. tigger

    tigger I'm the only one

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    Ati's has gone down by 0.3(5.8-5.44) tho' not 14 like nvidia.
  18. xfire

    xfire New Member

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    AMD's stock is falling even though they seem to have the upper hand:shadedshu
  19. Easy Rhino

    Easy Rhino Linux Advocate

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    nvidia didnt go down 14 points, it dropped to 14 points. and with ati's stock price hovering around 5 any drop is a significant one.
  20. 1c3d0g

    1c3d0g

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    I don't get it. Why is it that whenever defective packaging is detected, the chip designer is blamed instead of the foundry (TSMC, UMC etc.)? The foundry is the one which actually builds the chips (and packaging) for the designer so I believe it should be the one at fault here. Somehow they always slip through the cracks and get away with it. They must have some really good lawyers and bullet-proof contracts.
  21. Waldoinsc

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    Not really. This is the same as if you went to Wal Mart and bought a Vizio LCD TV that had a fault causing premature failure of the backlight. Vizio doesn't manufacture the light, they buy them from another manufacturer.

    But when it fails, John Q. Public is upset with Wal-Mart and Vizio. The lawyers start putting together a class action lawsuit against these companies. You don't see them going after the smaller light manufacturer. (Go after the company with the deeper pockets)
  22. Easy Rhino

    Easy Rhino Linux Advocate

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    why wouldnt you be upset with nvidia if you were an investor. the blame falls on nvidia because they are responsible for selling the product.
  23. Silverel

    Silverel New Member

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    It's not like nVidia is going to stop using TSMC. Not a whole lot of alternatives for them really. Unless they wanted to get their own fab. I hear AMD has one sitting around o_O

    Seriously, how do you manage to nutkick yourself multiple times in such rapid succession?
  24. WhiteLotus

    WhiteLotus

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    They will sack somebody expendable and then stock will increase. This happens all the time to other companies. And any, what goes up must come down!

    They've been number one for so long they just got complacent and made mistakes. Also i think Ati have rubbed a magic lamp or something to get their prices so low.
  25. btarunr

    btarunr Editor & Senior Moderator Staff Member

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    There are laptops failing out there....with their GPUs / Integrated Graphics going kaput.

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