General:
Lots of talk about DX11 abilities of the GTX4xx cards and quotes from reviews etc.
Expect to take back share in enthusiast market.
Shipped a few hundred thousand Fermi units, yields above expectations, selling out (consumer cards) on a weekly basis
Profits:
Profit drivers: high end GPUs and professional doing well.
Q1 good quarter driven by professional and high end and product ramps and Apple and notebook market.
45.6% margin.
40nm as a % of GPU revenue "quite a bit", grew quite nicely. No specific number given (30% of ATI product on 40nm for comparison).
Supply constraints easing. Yields of Fermi much higher than expected leading to good availability of GTX4xx and Tesla products.
Quadro at pre-recession levels.
40nm/yield
40nm challenges on yield and ability to supply market with adequate product.
Dec-Jan was a turning point, predictable improvements. Continued throughout Q1. Initial wafer starts sucked, now margin progression good, exceeded expectations and had more die available. Shipped everything they could. Going forward expect Fermi to continue to be an important element of product mix, hence improving margin.
Yield has improved a lot. TSMC done a fabulous job of improving yield since august. Yield and number of wafers has helped a lot. "Out of the woods" with respect to 40nm manufacturability. 40nm now a world class node and very good manufacturability.
Capacity/supply: supply constrained due to lots of people using 40nm. wish they had more Fermis and 40nm GPUs in general. Not enough 40nm supply for the entire world. Remain constrained for some time.
Marketshare:
What sort of marketshare trends expected?
Haven't been in high end segment due to 2Q delay in Fermi. Expectation to gain share in high end.
Didn't really lose anything to competition due to 40nm being supply constrained.
Gained overall share last Q mainly due to notebook shipping. Expect Optimus to gain adoption going forward.
Q2 is Q2, everyone has same feelings of seasonality leading to reduced revenue (AMD flat to -5%, NV at -2~3%)
Guidance of slightly down sensible. Q2 will be part seasonal, part high growth. Going to have to see how it turns out.
Notebooks:
Mercury data: up 77% in notebook discrete in last 2Q's
New chipset shipped to apple. Stuff about macs and switchable graphics.
70 Optimus design wins, 11 on market, 50 coming later in the year (for back to school season). Hope to improve GPU attach rate in notebooks.
Biggest factor of growth in discrete notebook is China. Highest adoption of discrete GPUs in China
Chinese consumers big on online and games. Geforce brand big in China.
Biggest factor for growth is China.
Seasonal demand still. For the core market, expecting seasonality. With Fermi, growing into high end (consumer) so pent up demand being seen. Ramping as hard and fast as they can to keep up with demand.
Rest of business (mainstream): should experience seasonality.
'Value add' (CUDA, 3D Vision etc)
Transforming company, moving away from just offering a fast chip to offering solutions and software that add value and differentiate e.g. 3d vision. CUDA only work with Geforce and add value to it.
Many other examples in Quadro, Tesla and Tegra. Value added ideas (through software).
For 3D Vision: Margins about corporate average. 3D Vision just had a record quarter (and then another and another...i.e. it's growing). Future of PCs is 3D (just like TV). Multimedia or gaming PC should come with some 3D glasses to enjoy it with. Standard offering on consumer PCs will be 3D. Proud of 3D Vision.
3D Vision creates a pull for graphics products more than the impact of 3D Glasses (sales?).
Tegra:
Currently focused around Zune/WinMo.
Tegra 2 will be nice for snappy graphics. Coming to android later on etc.
Smartphone now shipping with Tegra (and WinMo). More smartphones and tablets later in the year
Fermi:
Fermi die inventory waiting to be packaged at end of quarter due to lack of processing capacity (and more dies than expected).
Ramping into Fermi. Have to do a lot more back end testing which takes longer to sort, assemble, test it, and do system level testing. Many weeks to do all testing.
A lot of the die couldn't go through this process before the end of the quarter. Need to keep cranking through it. Growing into performance segment is #1 most important thing to do right now. Inventory lean for performance GPUs. Ramping up production. ASP trend should be going up due to getting back into high end market.
Currently sampling from entry level notebook to supercomputer Fermi.
Fermi strong this quarter and have an opportunity to ship it for full quarter.
Quadro and Tesla:
Mid to high 50's in gross margins eventually.
Highly differentiated business a big part of business. Quadro and Tesla and Tegra, where software is a large part of it, growing margins will continue to reflect that. In those markets gross margins are much better [than in consumer graphics cards]. 2/3rd of profits from these three businesses, even though only a small part of total revenues.
Over time as those businesses grow, margins should improve.
Mixed with mainstream Geforce business which will "continue to be competitive" margins in the 50s should be obtained.
Quadro ahead of where they expected to be today. Pent up demand for CS5 due to recession will help Quadro business grow.
Tesla record revenue. Fermi "unlocked new demand" in supercomputing, energy and finance. Long term success through adoption by OEMs (e.g. Supermicro)
Tesla for servers is going to ramp up substantially. First Tesla designed standard for OEM servers (didn't happen with previous Tesla products).
There was very little mentioned about mainstream and low end Fermi based products (although I think someone asked a question at the end which was misinterpreted), but they did say they were sampling a full lineup of Fermi based products, including low end mobile, so that's good news.
Obviously Tesla and Quadro (where Fermi is designed to make up shortfalls) are considered very important as they give NV the bulk of their money, and they even expect margins to go into the 50's, to which one of the guys asking questions had to ask if the NV guy had really said 50's because it seemed like a crazy goal. (High 50's type area is where Intel typically sit and they manufacture their own products).
(http://img638.imageshack.us/img638/9711/grossmargins.png See chart for comparison of historical gross margins between NV/VIA/AMD and NV)
Lots of talk about DX11 abilities of the GTX4xx cards and quotes from reviews etc.
Expect to take back share in enthusiast market.
Shipped a few hundred thousand Fermi units, yields above expectations, selling out (consumer cards) on a weekly basis
Profits:
Profit drivers: high end GPUs and professional doing well.
Q1 good quarter driven by professional and high end and product ramps and Apple and notebook market.
45.6% margin.
40nm as a % of GPU revenue "quite a bit", grew quite nicely. No specific number given (30% of ATI product on 40nm for comparison).
Supply constraints easing. Yields of Fermi much higher than expected leading to good availability of GTX4xx and Tesla products.
Quadro at pre-recession levels.
40nm/yield
40nm challenges on yield and ability to supply market with adequate product.
Dec-Jan was a turning point, predictable improvements. Continued throughout Q1. Initial wafer starts sucked, now margin progression good, exceeded expectations and had more die available. Shipped everything they could. Going forward expect Fermi to continue to be an important element of product mix, hence improving margin.
Yield has improved a lot. TSMC done a fabulous job of improving yield since august. Yield and number of wafers has helped a lot. "Out of the woods" with respect to 40nm manufacturability. 40nm now a world class node and very good manufacturability.
Capacity/supply: supply constrained due to lots of people using 40nm. wish they had more Fermis and 40nm GPUs in general. Not enough 40nm supply for the entire world. Remain constrained for some time.
Marketshare:
What sort of marketshare trends expected?
Haven't been in high end segment due to 2Q delay in Fermi. Expectation to gain share in high end.
Didn't really lose anything to competition due to 40nm being supply constrained.
Gained overall share last Q mainly due to notebook shipping. Expect Optimus to gain adoption going forward.
Q2 is Q2, everyone has same feelings of seasonality leading to reduced revenue (AMD flat to -5%, NV at -2~3%)
Guidance of slightly down sensible. Q2 will be part seasonal, part high growth. Going to have to see how it turns out.
Notebooks:
Mercury data: up 77% in notebook discrete in last 2Q's
New chipset shipped to apple. Stuff about macs and switchable graphics.
70 Optimus design wins, 11 on market, 50 coming later in the year (for back to school season). Hope to improve GPU attach rate in notebooks.
Biggest factor of growth in discrete notebook is China. Highest adoption of discrete GPUs in China
Chinese consumers big on online and games. Geforce brand big in China.
Biggest factor for growth is China.
Seasonal demand still. For the core market, expecting seasonality. With Fermi, growing into high end (consumer) so pent up demand being seen. Ramping as hard and fast as they can to keep up with demand.
Rest of business (mainstream): should experience seasonality.
'Value add' (CUDA, 3D Vision etc)
Transforming company, moving away from just offering a fast chip to offering solutions and software that add value and differentiate e.g. 3d vision. CUDA only work with Geforce and add value to it.
Many other examples in Quadro, Tesla and Tegra. Value added ideas (through software).
For 3D Vision: Margins about corporate average. 3D Vision just had a record quarter (and then another and another...i.e. it's growing). Future of PCs is 3D (just like TV). Multimedia or gaming PC should come with some 3D glasses to enjoy it with. Standard offering on consumer PCs will be 3D. Proud of 3D Vision.
3D Vision creates a pull for graphics products more than the impact of 3D Glasses (sales?).
Tegra:
Currently focused around Zune/WinMo.
Tegra 2 will be nice for snappy graphics. Coming to android later on etc.
Smartphone now shipping with Tegra (and WinMo). More smartphones and tablets later in the year
Fermi:
Fermi die inventory waiting to be packaged at end of quarter due to lack of processing capacity (and more dies than expected).
Ramping into Fermi. Have to do a lot more back end testing which takes longer to sort, assemble, test it, and do system level testing. Many weeks to do all testing.
A lot of the die couldn't go through this process before the end of the quarter. Need to keep cranking through it. Growing into performance segment is #1 most important thing to do right now. Inventory lean for performance GPUs. Ramping up production. ASP trend should be going up due to getting back into high end market.
Currently sampling from entry level notebook to supercomputer Fermi.
Fermi strong this quarter and have an opportunity to ship it for full quarter.
Quadro and Tesla:
Mid to high 50's in gross margins eventually.
Highly differentiated business a big part of business. Quadro and Tesla and Tegra, where software is a large part of it, growing margins will continue to reflect that. In those markets gross margins are much better [than in consumer graphics cards]. 2/3rd of profits from these three businesses, even though only a small part of total revenues.
Over time as those businesses grow, margins should improve.
Mixed with mainstream Geforce business which will "continue to be competitive" margins in the 50s should be obtained.
Quadro ahead of where they expected to be today. Pent up demand for CS5 due to recession will help Quadro business grow.
Tesla record revenue. Fermi "unlocked new demand" in supercomputing, energy and finance. Long term success through adoption by OEMs (e.g. Supermicro)
Tesla for servers is going to ramp up substantially. First Tesla designed standard for OEM servers (didn't happen with previous Tesla products).
There was very little mentioned about mainstream and low end Fermi based products (although I think someone asked a question at the end which was misinterpreted), but they did say they were sampling a full lineup of Fermi based products, including low end mobile, so that's good news.
Obviously Tesla and Quadro (where Fermi is designed to make up shortfalls) are considered very important as they give NV the bulk of their money, and they even expect margins to go into the 50's, to which one of the guys asking questions had to ask if the NV guy had really said 50's because it seemed like a crazy goal. (High 50's type area is where Intel typically sit and they manufacture their own products).
(http://img638.imageshack.us/img638/9711/grossmargins.png See chart for comparison of historical gross margins between NV/VIA/AMD and NV)
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