Nvidia lowers its Q2 revenue estimate

Santa Clara based NVIDIA confirmed that second quarter of fiscal year 2009 will not be as good as initially estimated and desired.

The company is saying that its Q2 revenue will be under $1 billion and hover around $875 million to $950 million due to worldwide end-market weakness, the delays of several chipsets and the competition from AMD which forced it to lower the prices of some of its GPUs.

Since problems seem to come at least in pairs Nvidia has also announced its plan to "take a one-time charge from $150 million to $200 million against cost of revenue for the second quarter to cover anticipated warranty, repair, return, replacement and other costs and expenses, arising from a weak die/packaging material set in certain versions of its previous generation GPU and MCP products used in notebook systems." CEO Jen-Hsun Huang has stated that the company has learned from these higher than expected failure rates and that it will work more closely with OEMs to address such issues. The results for Q2 of the financial year 2009 will be revealed on August 12.