Fiscal Year Quarterly Highlights Highlights ---------------------------- ------------------ Q4 Q3 Q4 FY2011 FY2011 FY2010 FY2011 FY2010 -------- -------- -------- -------- -------- Revenue $ 886.4 $ 843.9 $ 982.5 $ 3,543 $ 3,326 -------- -------- -------- -------- -------- GAAP: -------- -------- -------- -------- -------- Gross margin 48.1% 46.5% 44.7% 39.8% 35.4% -------- -------- -------- -------- -------- Net income (loss) 171.7 $ 84.9 $ 131.1 $ 253.1 ($ 68.0) -------- -------- -------- -------- -------- Income (loss) per share $ 0.29 $ 0.15 $ 0.23 $ 0.43 ($ 0.12) -------- -------- -------- -------- --------The company's fourth quarter results include a $57.0 million credit to operating expenses, $37.1 million after tax, as a result of a legal settlement in connection with a new licensing agreement entered into with Intel. "These strong results underscore the larger story of NVIDIA's transformation," said Jen-Hsun Huang, NVIDIA president and chief executive officer. "Even as we are extending our leadership in visual computing, our investment in mobile computing and parallel computing is now driving our growth. "Tegra is positioned center stage in the revolution in super phones and tablets, while Tesla is becoming an essential processor for supercomputing. I have never been more excited about NVIDIA's prospects." Outlook The outlook for the first quarter of fiscal 2012 is as follows:
NVIDIA CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except per share data) (Unaudited) Three Months Ended Twelve Months Ended --------------------- -------------------------- January 30, January 31, January 30, January 31, 2011 2010 2011 2010 -------- -------- ---------- ---------- Revenue $886,376 $982,488 $3,543,309 $3,326,445 Cost of revenue 460,017 543,767 2,134,219 2,149,522 -------- -------- ---------- ---------- Gross profit 426,359 438,721 1,409,090 1,176,923 Operating expenses Research and development 215,563 216,251 848,830 908,851 Sales, general and administrative 88,018 88,188 361,513 367,017 Legal settlement (57,000) (A) - (57,000) (A) - -------- -------- ---------- ---------- Total operating expenses 246,581 304,439 1,153,343 1,275,868 -------- -------- ---------- ---------- Operating income (loss) 179,778 134,282 255,747 (98,945) Interest and other income, net 6,128 5,139 15,422 16,651 -------- -------- ---------- ---------- Income (loss) before income tax expense 185,906 139,421 271,169 (82,294) Income tax expense (benefit) 14,255 8,345 18,023 (14,307) -------- -------- ---------- ---------- Net income (loss) $171,651 $131,076 $ 253,146 $ (67,987) ======== ======== ========== ========== Basic net income (loss) per share $ 0.29 $ 0.24 $ 0.44 $ (0.12) ======== ======== ========== ========== Diluted net income (loss) per share $ 0.29 $ 0.23 $ 0.43 $ (0.12) ======== ======== ========== ========== Shares used in basic per share computation 583,439 557,479 575,177 549,574 Shares used in diluted per share computation 601,559 582,081 588,684 549,574 (A) On January 10, 2011, the Company and Intel entered into a new six-year cross licensing agreement and both parties also agreed to settle all outstanding legal disputes. For accounting purposes, the fair valued benefit prescribed to the settlement portion was $57.0 million. NVIDIA CORPORATION CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands) (Unaudited) January 30, January 31, 2011 2010 ----------- ----------- ASSETS Current assets: Cash, cash equivalents and marketable securities $ 2,490,563 $ 1,728,227 Accounts receivable, net 348,770 374,963 Inventories 345,525 330,674 Prepaid expenses and other current assets 42,092 46,966 ----------- ----------- Total current assets 3,226,950 2,480,830 Property and equipment, net 614,431 571,858 Goodwill 369,844 369,844 Intangible assets, net 243,171 120,458 Deposits and other assets 40,850 42,928 ----------- ----------- Total assets $ 4,495,246 $ 3,585,918 =========== =========== LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable $ 286,138 $ 344,527 Accrued liabilities and other current liabilities 656,544 439,851 ----------- ----------- Total current liabilities 942,682 784,378 Other long-term liabilities 347,713 111,950 Capital lease obligations, long term 23,389 24,450 Stockholders' equity 3,181,462 2,665,140 ----------- ----------- Total liabilities and stockholders' equity $ 4,495,246 $ 3,585,918 =========== =========== NVIDIA CORPORATION RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES (In thousands, except per share data) (Unaudited) Three Months Ended ----------------------------------------- January 30, October 31, January 31, 2011 2010 2010 ----------- ----------- ----------- GAAP gross profit $ 426,359 $ 392,062 $ 438,721 GAAP gross margin 48.1% 46.5% 44.7% Net charge against cost of revenue arising from a weak die/packaging material set - - - Stock option purchase charge related to cost of revenue - - - ----------- ----------- ----------- Non-GAAP gross profit $ 426,359 $ 392,062 $ 438,721 =========== =========== =========== Non-GAAP gross margin 48.1% 46.5% 44.7% GAAP operating expenses $ 246,581 $ 288,279 $ 304,439 Net charge against operating expenses arising from a weak die/packaging material set - - - Stock option purchase charge related to operating expenses - - - Legal settlement 57,000 (C) - - ----------- ----------- ----------- Non-GAAP operating expenses $ 303,581 $ 288,279 $ 304,439 =========== =========== =========== GAAP net income (loss) $ 171,651 $ 84,862 $ 131,076 Total pre-tax impact of non-GAAP adjustments (57,000) - - Income tax impact of non-GAAP adjustments 24,359 (D) - - ----------- ----------- ----------- Non-GAAP net income $ 139,010 $ 84,862 $ 131,076 =========== =========== =========== Diluted net income (loss) per share GAAP $ 0.29 $ 0.15 $ 0.23 =========== =========== =========== Non-GAAP $ 0.23 $ 0.15 $ 0.23 =========== =========== =========== Shares used in GAAP diluted net income (loss) per share computation 601,559 582,648 582,081 Cumulative impact of non-GAAP adjustments - - - ----------- ----------- ----------- Shares used in non-GAAP diluted net income (loss) per share computation 601,559 582,648 582,081 =========== =========== =========== Metrics: GAAP net cash flow provided by operating activities $ 434,674 $ 212,177 $ 69,245 Purchase of property and equipment and intangible assets (21,344) (21,823) (22,575) ----------- ----------- ----------- Free cash flow $ 413,330 $ 190,354 $ 46,670 =========== =========== =========== Twelve Months Ended -------------------------------- January 30, January 31, 2011 2010 ----------- ----------- GAAP gross profit $ 1,409,090 $ 1,176,923 GAAP gross margin 39.8% 35.4% Net charge against cost of revenue arising from a weak die/packaging material set 181,193 (A) 95,878 (A) Stock option purchase charge related to cost of revenue - 11,412 (B) ----------- ----------- Non-GAAP gross profit $ 1,590,283 $ 1,284,213 =========== =========== Non-GAAP gross margin 44.9% 38.6% GAAP operating expenses $ 1,153,343 $ 1,275,868 Net charge against operating expenses arising from a weak die/packaging material set (12,705) (A) 1,929 (A) Stock option purchase charge related to operating expenses - (128,829) (B) Legal settlement 57,000 (C) - ----------- ----------- Non-GAAP operating expenses $ 1,197,638 $ 1,148,968 =========== =========== GAAP net income (loss) $ 253,146 $ (67,987) Total pre-tax impact of non-GAAP adjustments 136,898 234,190 Income tax impact of non-GAAP adjustments (8,469) (D) (24,820) (D) ----------- ----------- Non-GAAP net income $ 381,575 $ 141,383 =========== =========== Diluted net income (loss) per share GAAP $ 0.43 $ (0.12) =========== =========== Non-GAAP $ 0.65 $ 0.25 =========== =========== Shares used in GAAP diluted net income (loss) per share computation 588,684 549,574 Cumulative impact of non-GAAP adjustments - 18,488 (E) ----------- ----------- Shares used in non-GAAP diluted net income (loss) per share computation 588,684 568,062 =========== =========== Metrics: GAAP net cash flow provided by operating activities $ 675,797 $ 487,807 Purchase of property and equipment and intangible assets (97,890) (77,601) ----------- ----------- Free cash flow $ 577,907 $ 410,206 =========== =========== (A) Excludes a charge related to the weak die/packaging material set that was used in certain versions of our previous generation chips, net of insurance reimbursement. (B) During the three months ended April 26, 2009, the Company completed a tender offer to purchase outstanding stock options which resulted in a charge of $140.2 million, $11.4 million of which was associated with cost of revenue and $128.8 million with operating expenses. (C) On January 10, 2011, the Company and Intel entered into a new six-year cross licensing agreement and both parties also agreed to settle all outstanding legal disputes. For accounting purposes, the fair valued benefit prescribed to the settlement portion was $57.0 million. (D) The income tax impact of non-GAAP adjustments has only been reported during fiscal quarters that include other GAAP to non-GAAP reconciling items, as well as in the full fiscal year results during which the GAAP to non-GAAP reconciling items occur. As such, any effective tax rate differences between GAAP and non-GAAP results that result from such adjustments have not been reported separately in the non-GAAP results for a fiscal quarter that does not contain other GAAP to non-GAAP reconciling items. (E) Reflects an adjustment to diluted shares to reflect a non-GAAP net income versus a GAAP net loss.
Contact Information: For further information, contact: Michael Hara Investor Relations NVIDIA Corporation (408) 486-2511 mhara@nvidia.com Robert Sherbin Corporate Communications NVIDIA Corporation (408) 566-5150 rsherbin@nvidia.com