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Nvidia stock downgraded, shares fall. Fermi at fault?

Discussion in 'Graphics Cards' started by tbh, 17 Apr 2010.

  1. tbh

    Wise Guy

    Joined: 12 Sep 2007

    Posts: 1,785


    "Shares of NVIDIA Corp. (NASDAQ: NVDA) have dropped significantly during morning trading following a downgrade ahead of the opening bell, and options action out of the gate suggests at least one investor expects the downside to continue throughout the later-term.

    Shares of NVDA are currently down $1.07, or nearly 6%, to $16.94 following Needham’s negative note this morning. Needham downgraded the company to “hold” from “strong buy” due to prospective product delays. NVDA has not announced its next earnings release date, but the market anticipates the report around May 6."

    Interesting, looks like the markets are reacting and the Fermi saga is finally taking its toll on nVidia's stock price. They better start getting product out in quantity if they are to avoid the continued fall the investor in the article predicted.
  2. kylew


    Joined: 31 May 2007

    Posts: 10,739

    Location: Liverpool

    Really not surprised, it's been a long time coming and not completely Fermi's fault.

    They had to stop manufacturing GT200 chips because they were losing them a lot of money.

    They didn't manufacture many cards at all between now and when they stopped making GT200s.

    Fermi's just another blow that's making it harder for them really.

    They're a struggling company and this is the last thing they need.
  3. Amakuma


    Joined: 26 Jan 2010

    Posts: 291

    They wernt going to pull what ati did with 48xx range with fermi, which was the last decent move by a graphics company.

    Coming in so expensive and late did some serious damage, they need to come up with some decent 100-200 pound solutions to match the mid-range ATI currently has.

    Otherwise its going to be a slow decent
  4. drunkenmaster


    Joined: 18 Oct 2002

    Posts: 33,194

    According to a lot of people Nvidia have been basically lying to analysts and senior market people the same way they've been lying to us. Lie to them about when you can deliver cards, they'll buy it but not like it when they realise they've been lied to.

    6million AMD DX11 units shipped versus what, not even 6k Nvidia DX11 units really doesn't look good. I mean a AMD driver team go to Blizzard, or Bioware, trying to get involved on a new game, and so do Nvidia, but AMD say, add the latest features we've got 6 million more cards out there and will have a lead on sales for at least another year, it says a lot and can significantly shift the gaming direction behind the scenes.

    Another BIG hit that could happen is rumoured Apple talking to AMD, which has been on the cards for around 6 months starting from last year when Apple put in a huge order for AMD cards because they couldn't get hold of what they needed from Nvidia, they've added a couple other AMD cards in things and are now rumoured to be making it a more permanent and more widespread thing that might well include AMD CPU's, which is HUGE.

    My guess is the shipping of samples of LLano, a decent cheap quad, with a 5650 power level part stuck inside the cpu and a cheaper overall setup and rumours of Apple wanting to talk to AMD aren't unrelated. They've been impressed with AMD gpu's, they realise AMD's "fusion" products are going to spank Intel's due to hugely more impressive GPU's inside.

    AMD are going from strength to strength and GPU success is dragging their CPU's to companys that haven't used them, and other companies that use the CPU's will find it cheaper to go with AMD gpu's than Nvidia.
  5. RavenXXX2


    Joined: 6 Oct 2007

    Posts: 18,598

    Location: North West

    What else do Nvidia produce...their mobo chipset department is all but dead, I think they have some small share in the mobile chip market, and the PS3 GPU, not surprising they are having trouble, and I'm sorry to say but it can only get worse with the state of fermi.
  6. kieves1

    Wise Guy

    Joined: 18 Feb 2009

    Posts: 1,356

    It wasnt a good day for tech chips in general.
    Nvidia finished at $17.06 down 5.27%
    Amd finished at $9.81 down 3.44%
    Intel finished at $23.93 down 1.24%
  7. Sukh


    Joined: 29 Jan 2007

    Posts: 3,583

    Location: Chelsea

    I hope they turn it around, I have a 4890, but wouldn't want the competition to disappear.
  8. DeeJayCee


    Joined: 7 Apr 2010

    Posts: 306

    Location: St Albans, UK

    Nvidia supply apple with the GPUs for their new MacBooks which will help a bit.

    I'm sure NV will bounce back on the share front
  9. fs123


    Joined: 4 Feb 2006

    Posts: 3,006

    If AMD get the upper hand now we might start seeing more "get in the game" titles..
  10. RavenXXX2


    Joined: 6 Oct 2007

    Posts: 18,598

    Location: North West

    It's already under way, Dirt2 and alien v predator both endorsed by ATI, it's going around that crysis 2 could be as well.
  11. p0rks0da


    Joined: 6 Jan 2004

    Posts: 843

    Location: West Sussex

    Nvidia are a pretty huge company, they won't disappear any time soon. Competition will suffer until they get their act together though, i expect rip off pricing from both parties for a while longer yet.
  12. drunkenmaster


    Joined: 18 Oct 2002

    Posts: 33,194

    Chipsets are dead, the ION 2 "chipset" has zero chipset functionality, its the only chipset they really make now and it requires a Atom and the Atom chipset from Intel and is connected via PCI-E and not through a proper interconnect. PS3 gpu is Nvidia, but every single person in the world is predicting Sony dumping Nvidia for their next console in the next couple years, Sony don't like Nvidia, Nvidia pee off all of their partners by abusing their position and generally being arrogant. Sony were set to go Intel if they had anything ready, I can see a move to AMD if Intel aren't ready, which is more and more likely.

    As Nvidia's low end becomes less competitive and even less so again come the next gen they'd have to move their low end, up to Fermi derivities, which will be even worse for Nvidia because it will mean less profit per sale, in their most profitable sector, not good. I mean basically the "Fermi" low end will likely be double the size of the current low end they make. Double the size means lower yields + half the cores per wafer, meaning they'll cost more than double to make but need to be sold in the same price range.

    Nope, Nvidia have basically dominated Apple for a while with zero sign of AMD, they should be providing every GPU Apple need, with almost every passing month Apple are increasing their usage of AMD and using less Nvidia chips. Nvidia are losing their grip on all the area's they used to completely dominate.

    They really will, unfortunately, analysts are slowly losing patience, after the first quarter of Fermi sales they'll really have very little to tell investors, unless they lie, that Fermi made a huge loss and by then everyone will know for a fact if its in production or not, if its not lots of people will lose confidence in them, but even worse, it means all the OEM builders will all be using AMD in their high end machines, that means in most purple shirt stores most of the high end rigs will all have AMD in, thats how companies get popular, when the average joe can only see one name across all the high end expensive rigs, it makes them think they should have AMD aswell, even if their computer only has a 4350 in it.

    NVidia have it good right now, they've almost exclusively been making profit off low end sales of their 40nm dx10.1 gpu. Its probably the only area that will be profitable with high sales for their DX11 gpu's(and theres no sign of them coming in the next 4-5 months, only the mid end has taped out and thats probably still 3 months away). But when Llano hits, on 32nm no less we'll have quad cores with powerful graphics that Nvidia low end won't be competitive with and AMD doing deals with all the people Nvidia normally sells low end gpu's too.

    IN the next 18-24 months Intel and AMD will completely exclude Nvidia from the low end market, the only place Nvidia's been making profit in the past 12 months.

    Nvidia have slowly lost most of their profit from the high end for the past year, and aren't getting it back, they've gone from unprofitable in the high end, to unable to produce a high end. Midrange has gone from high to low profits and will likely go from low to no profits on Fermi, the low end has always been the highest profit sector, and within 2 years they won't have a low end market.

    Tegra is doing FAR worse than Nvidia claim, Tegra 2 is late, missed a bunch of deadlines for a bunch of companies and Samsung, one of the biggest "wins" for the Tegra 2 design, dumped it because its not good enough.

    THeir chipset market is completely dead, gpu's are drying up, the majority of their market(low end) is simply not going to be there anymore in a year or two, their mobile stuff is highly marketed but not very successful at all, their business/gpgpu stuff can't sustain the R&D costs when most of their other profit has dried up.

    They are basically boned for the long term, the only question is how long can they last after they stop making profit.

    This is all ontop of the fact that when AMD switch to Global foundries for GPU, their size/power/clockspeed/yield advantage will bump them even further ahead. TSMC skimp out and make cheap designs, Global foundries 28nm is set to be about 20-30% smaller than TSMC's 28nm for the same transistor count, all process's are not equal. Likewise they won't have the leakage, power or yield problems TSMC will almost certainly have at 28nm. If AMD are already making cores that are some 50% smaller, if both do the usual doubling of shaders when moving to a lower process and doubling the transistor count you'd expect if they both stayed at TSMC, for the size difference to remain the same. If AMD go to Global and drop 20-30% of their size, it will end up a 60-65% smaller core instead, which will mean even more cores per wafer, on a process that has vastly higher yields and less leakage so is capable of going higher clock speeds.

    You could be looking at a core that is 65% smaller, with significantly higher yields, costing maybe 30% of what an Nvidia core would cost to produce while the bump in clock speeds and the lack of improvements at TSMC could see AMD flat out faster than Nvidia aswell as cheaper, Nvidia would be simply done at that point. Imagine if the 5870 was on Global foundries now, cost 25% less due to size/yields and could clock 20% faster. You'd have 5870's at £220, and beating a 480gtx at stock and making a profit, Nvidia can't make a profit now on a 480gtx at £450.
    Last edited: 17 Apr 2010
  13. AtreuS


    Joined: 13 Feb 2004

    Posts: 5,186

    Location: Sealed in my Sarcophagus.

    No matter how you look at it, its not good news for nvidia.

    This is of course a shame as we need competition in the GPU market and should nvidia fall it would be bad for us in the long term.


    Joined: 8 Jan 2010

    Posts: 930

    Location: London

    Yep its bad read in other post 6million dx11 ati cards sold already, there really far behind
  15. p0rks0da


    Joined: 6 Jan 2004

    Posts: 843

    Location: West Sussex

    The thing is, Nvidia were already talking to GF last year.


    So the process advantage is by no means an ATI exclusive, GF after all is a completely seperate entity to AMD now and will be looking to get the business of any company they can.
  16. jigger


    Joined: 28 May 2007

    Posts: 13,685

    They need better leadership.

    Jen Hsun Huang said no to the globalfoundries deal.

    “Globalfoundries is an AMD fab, right? Globalfoundries is AMD's fab. Our strategy is TSMC,” said Jen-Hsun Huang, chief exec of Nvidia, in an interview with Cnet News web-site.

    No wonder the company is struggling when its stuck with him.
  17. chaosquall


    Joined: 16 Feb 2010

    Posts: 308

    Location: Southend-On-Sea, Essex

    i am a amd / ati radeon fanboy, i dont want to see nvidia go because then ati could raise prices because it is the only competition nad it would monopilize the market
  18. p0rks0da


    Joined: 6 Jan 2004

    Posts: 843

    Location: West Sussex

    Oh my bad, i don't recall reading that at the time. Oh well, one of his two statements is false, we'll have to see which one it is lol.
  19. theforce

    Wise Guy

    Joined: 5 Jan 2005

    Posts: 2,146

    Location: Larnaca, Cyprus

    Nvidia is just passing through a bad phase. Hopefully they will manage to resolve some if not all their issues in 2011 when the 28nm process is ready.
  20. Freddie1980


    Joined: 25 Sep 2009

    Posts: 7,456

    Location: Billericay, UK

    Global Foundries is mostly owned by a Dubi investment group but AMD still has a 40% stake in the company and it has all the say when it comes to the management of the company so AMD has the final say to this kind of thing.

    I couldn't agree more Jen Hsun comes across as more an marketing/spin doctor expert rather then engineer/developer which IMO isn't what you want when trying to run a company like Nvidia.

    However I would say despite all the problems Nvidia are having posters like drunkenmaster are being a bit over dramatic (although his analysis is an excellent read) you have to remember Nvidia is a company that has zero debts, no borrowing, no loans and it very cash rich and in their last quarter did actually make a tidy profit (it will be interesting to see Q1 2010 results as they have had little to no top end products to sell). With that in mind you can expect Nvidia to further improve Fermi's efficiency and speed in it's 2nd and 3rd irritations and I would expect it's power requirements to either go down or stay the same whilst at the same time Nvidia will be able to double it's performance each time.

    I do agree with the assessment on the low end, with Intel integrating a video chip on the CPU (and AMD to follow suit) it makes the need for low end cards like the GT220, GT300 etc virtually redundant but then again the profit margins on low end products is negligible anyway as when you selling at the low end people will want something for nothing and video cards are no exception. Nvidia needs to concentrate on making it's currant line of mid range and high end cards profitable as that's where the money is made - premium products can carry a premium price.

    Last edited: 17 Apr 2010