From DailyTech: Q3 2013 was a difficult time for companies in the tech space. Back in 2010 and 2011 PC makers grappled with growing fears of erosion from mobile devices, but for those in the mobile sector it was a golden era. If you had ambitious mobile product on the market, you were virtually guaranteed big earnings and growth -- just ask HTC Corp. (TPE:2498).
Today being mobile is no longer a guarantee of growth, as growth of profit-driving sales of high end smartphones and tablets slows. Even as traditional PC players struggle to try to become more mobile, mobile component/device makers like Apple, Inc. (AAPL), Samsung Electronics Comp., Ltd. (KSC:005930), and Qualcomm, Inc. (QCOM) are struggling to maintain growth.
Amid that backdrop expectations for NVIDIA Corp.'s (NVDA) fiscal Q4 2014 (which falls roughly in line with calendar Q3 2013, running from August-October) were low.
Traditionally NVIDIA's sales have been driven by the sale of GPUs to the PC market, where it vies with Advanced Micro Devices, Inc. (AMD) for dominance (and to a lesser extent Intel Corp.'s (INTC) integrated GPUs). But today NVIDIA's sales are also driven by its Tegra line of system-on-a-chip processors for smartphones and tablets. Hence analysts were expected weak growth on account of the company's sensitivity to mobile slowdown.
Excluding one-time costs, profit (non-GAAP income) was $0.26 USD/share ($153.8M USD). Net profit (GAAP net income) was $0.20 USD/share ($118.7M USD). While that's just a little over half of what NVIDIA made a year ago ($0.33 USD/share; $209.1M USD in Q3 2012), it's marginally better than the $0.25 USD/share that analysts in a Bloomberg poll were expecting.
The chipmaker might have done even better were it not for a large (+17.6%) rise in operating expenses, with expenses rising from $344.8M USD a year ago to $405.4M USD in Q3.
NVIDIA saw sales (revenue) fall 12.5 percent on a YoY (year to year) basis to $1.054B USD, down from $1.204B USD a year ago. That was roughly in line with the $1.052B USD predicted in the Thomson Reuters I/B/E/S analyst poll, and the $1.05B USD predicted in Bloomberg's analyst poll.
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