NVIDIA hit by large Q2 '09 loss

GPU maker NVIDIA has taken a big Q2 '09 hit, reporting a quarterly net loss and a 5% drop in revenues compared to a year ago.

• Sales of $893 million, down 23% compared to Q1 '09 and down 5% compared to a year ago
• The company reported a loss of $120.9 million

Two issues behind the loss:

• First is the charge that the company took to cover warranty repairs associated with the thermal issues affecting some GPUs (latest on that here)
• Secondly, the company blames a weakening desktop market and the fact that the company made mistakes when it came to pricing.

Here's what Jen-Hsun Huang, NVIDIA's chief executive, had to say:

"Our Q2 financial performance was disappointing. The desktop PC market around the world weakened during the quarter. And our miscalculation of competitive price position further pressured our desktop GPU business. We have a great product line-up and, having taken the necessary pricing actions, we are strongly positioned again. Our focus now is to drive cost improvements and to further enhance our competitiveness through the many exciting initiatives we have planned for the rest of the year.

"In contrast, the rest of our businesses did not exhibit the same dynamics as our desktop business. The notebook GPU, MCP, and Professional Solutions groups grew a combined 27 percent year-over year."

The company offered no guidance for Q3.

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