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Graphic chip card maker NVIDIA (ticker: NVDA) reported 3Q05 (F3Q06) earnings of $65.3 million (36 cents/share), up from $25.9 million (15 cents/share), last year. The stock dropped about 4% following the report. Other key data points and quotes from the NVIDIA conference call:

  • Revenue: $583 million (up 13% year-over-year)
  • Gross margins: 39.1% (up 6.8% year-over-year)
  • Guidance for F4Q06: revenue growth 'between 5-8%', and 'gross margins of 40% is possible'.

In the conference call, NVIDIA CEO Jen-Hsun Huang addressed the company's plans for the mobile handset market:

    We have design wins at three of the top five [editor: handset makers]… our handheld business -- our focus has always been to focus on the multimedia rich segments of the cell phone where we can really add value… we should focus on the segments where the bandwidth of that device is high so that you could download content to it at 3G for Wi-Fi for that matter. And because without the content, who would need the media processing capability that we provide?... And it's starting to become evident that rich media players are going to be a very important device in the future and content providers are becoming more thoughtful about the devices of the distribution platform for their content…

    Right now, the media players are really related to MP3, which are really, you know, it's a memory stick with steroids and there's not a whole lot of opportunity for us at that level. But as H.264 and games and much richer music comes available, which is going to happen when you have more bandwidth and disk drives get larger… the portable devices over the next ten years are going to become an amazing thing.

(Quotes are from the CCBN StreetEvents transcript.)

NVIDIA 1-yr chart:

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Source: NVIDIA Comments on Entering Mobile Handset Market (NVDA 3Q05 (F3Q06) Conf Call Quotes)