SANTA CLARA, CA -

  • Record revenue in Q4 of $1.25 billion, up 9 percent from $1.14 billion a year earlier.
  • GAAP diluted EPS in Q4 of $0.35, up 40 percent from $0.25 a year earlier. Non-GAAP diluted EPS in Q4 of $0.43, up 34 percent from $0.32 a year earlier.
  • Record revenue in fiscal 2015 of $4.68 billion, up 13 percent from $4.13 billion a year earlier.
  • GAAP diluted EPS in fiscal 2015 of $1.12, up 51 percent from $0.74 a year earlier. Non-GAAP diluted EPS in fiscal 2015 of $1.42, up 43 percent from $0.99 a year earlier.

NVIDIA (NASDAQ: NVDA) today reported record revenue for the fourth quarter ended January 25, 2015, of $1.25 billion, up 9 percent from $1.14 billion a year earlier and up 2 percent from $1.23 billion the previous quarter. 

Revenue for fiscal 2015 was a record $4.68 billion, up 13 percent from $4.13 billion a year earlier.

GAAP earnings per diluted share for the quarter were $0.35, up 40 percent from $0.25 a year earlier and up 13 percent from $0.31 in the previous quarter. Non-GAAP earnings per diluted share were $0.43, up 34 percent from $0.32 a year earlier and up 10 percent from $0.39 in the previous quarter.

GAAP earnings per diluted share for fiscal 2015 were $1.12, up 51 percent from $0.74 a year earlier. Non-GAAP earnings per diluted share were $1.42, up 43 percent from $0.99 a year earlier.

"Momentum is accelerating in each of our market-specialized platforms, driving record revenue in the quarter and full year," said Jen-Hsun Huang, president and chief executive officer of NVIDIA.

"GeForce and SHIELD are extending our reach in the rapidly growing global gaming market. Our DRIVE auto-computing platform is at the center of the advance toward self-driving cars. GRID is enabling enterprises to finally virtualize graphics-intensive applications. And our Tesla accelerated computing platform is helping to ignite the deep learning revolution.

"The success of these platforms highlights the growing importance of visual computing and the opportunities ahead for NVIDIA," he said.

During the fourth quarter, NVIDIA paid $46 million in cash dividends and repurchased 0.2 million shares. During fiscal 2015, the company paid $186 million in cash dividends and repurchased 44.4 million shares for $814 million. As a result, the company returned to shareholders $1.0 billion in fiscal 2015.

Since the restart of its capital return program in the fourth quarter of fiscal 2013, NVIDIA has returned approximately $2.22 billion to shareholders. This return represents 111 percent of the company's cumulative free cash flow for fiscal years 2013 through 2015, reflecting the acceleration of the capital return program from cash generated in previous years. 

The company intends to return approximately $600 million to shareholders through ongoing quarterly cash dividends and share repurchases in fiscal 2016.

NVIDIA will pay its next quarterly cash dividend of $0.085 per share on March 19, 2015, to all shareholders of record on February 26, 2015. NVIDIA expects that a portion of this dividend payment may be considered a return of capital for U.S. federal income tax purposes.

 
GAAP Quarterly Financial Comparison
($ in millions except earnings per share) Q4 FY15 Q3 FY15 Q4 FY14 Q/Q Y/Y
Revenue $1,251 $1,225 $1,144 up 2% up 9%
Gross margin 55.9% 55.2% 54.1% up 70 bps up 180 bps
Operating expenses $468 $463 $452 up 1% up 4%
Net income $193 $173 $147 up 12% up 31%
Diluted earnings per share $0.35 $0.31 $0.25 up 13% up 40%
 
Non-GAAP Quarterly Financial Comparison
($ in millions except earnings per share) Q4 FY15 Q3 FY15 Q4 FY14 Q/Q Y/Y
Revenue $1,251 $1,225 $1,144 up 2% up 9%
Gross margin 56.2% 55.5% 53.8% up 70 bps up 240 bps
Operating expenses $420 $415 $408 up 1% up 3%
Net income $241 $220 $187 up 10% up 29%
Diluted earnings per share $0.43 $0.39 $0.32 up 10% up 34%

NVIDIA's outlook for the first quarter of fiscal 2016 is as follows:

  • Revenue is expected to be $1.16 billion, plus or minus two percent.
  • GAAP and non-GAAP gross margins are expected to be 56.2 percent and 56.5 percent, respectively, plus or minus 50 basis points.
  • GAAP operating expenses are expected to be approximately $478 million; non-GAAP operating expenses are expected to be approximately $425 million, inclusive of litigation costs. 
  • GAAP and non-GAAP tax rates for the first quarter of fiscal 2016 are expected to be 20 percent, plus or minus one percent -- excluding the benefit of the U.S. Federal R&D tax credit which expired December 31, 2014.
  • Capital expenditures are expected to be approximately $30 million to $40 million.

Fourth Quarter Fiscal 2015 Highlights
During the fourth quarter, NVIDIA achieved progress in each of its market-specialized platforms:

Gaming:

  • Introduced the GeForce® GTX™ 960 GPU, bringing the power and efficiency of the Maxwell architecture to the gaming market's $199 sweet spot.

Enterprise Graphics:

  • Announced, shortly after the quarter, that the new version of VMware's virtualization suite, VMware Horizon 6, includes the capability to deliver scalable, virtualized 3D graphics enabled by NVIDIA GRID vGPU™.

Accelerated Computing:

Automotive:

  • Unveiled at the International Consumer Electronics Show the NVIDIA® Tegra® X1 mobile processor -- a 256-core Maxwell™ architecture-based mobile super chip with over one teraflops of computing power.
  • Launched NVIDIA DRIVE™ automotive computers, which move the industry closer to the era of auto-piloted cars and run next-generation infotainment systems.

CFO Commentary
Commentary on the quarter by Colette Kress, NVIDIA's executive vice president and chief financial officer, is available at http://investor.nvidia.com/.

Conference Call and Webcast Information
NVIDIA will conduct a conference call with analysts and investors to discuss its fourth quarter and fiscal 2015 financial results and current financial prospects today at 2 p.m. Pacific Time (5 p.m. Eastern Time). To listen to the conference call, dial (303) 223-4365; no password is required. A live webcast (listen-only mode) of the conference call will be accessible at NVIDIA's investor relations website, http://investor.nvidia.com, and at www.streetevents.com. The webcast will be recorded and available for replay until the company's conference call to discuss its financial results for its first quarter fiscal 2016.

Non-GAAP Measures
To supplement NVIDIA's Condensed Consolidated Statements of Operations and Condensed Consolidated Balance Sheets presented in accordance with GAAP, the company uses non-GAAP measures of certain components of financial performance. These non-GAAP measures include non-GAAP gross profit, non-GAAP gross margin, non-GAAP operating expenses, non-GAAP other income and expense, non-GAAP income tax expense, non-GAAP net income, non-GAAP net income, or earnings, per diluted share, and free cash flow. In order for NVIDIA's investors to be better able to compare its current results with those of previous periods, the company has shown a reconciliation of GAAP to non-GAAP financial measures. These reconciliations adjust the related GAAP financial measures to exclude stock-based compensation, legal settlements, a credit related to a weak die/packaging material set, acquisition-related costs, gains and losses from non-affiliated investments, interest expense related to amortization of debt discount, other expense and the associated tax impact of these items, where applicable. Free cash flow is calculated as GAAP net cash provided by operating activities less purchases of property and equipment and intangible assets. NVIDIA believes the presentation of its non-GAAP financial measures enhances the user's overall understanding of the company's historical financial performance. The presentation of the company's non-GAAP financial measures is not meant to be considered in isolation or as a substitute for the company's financial results prepared in accordance with GAAP, and our non-GAAP measures may be different from non-GAAP measures used by other companies.

To Keep Current on NVIDIA:

 
NVIDIA CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share data)
(Unaudited)
               
               
  Three Months Ended   Twelve Months Ended
  January 25,   January 26,   January 25,   January 26,
  2015   2014   2015   2014
                       
Revenue $ 1,250,514   $ 1,144,218   $ 4,681,507   $ 4,130,162
Cost of revenue   550,911     524,976     2,082,030     1,862,399
Gross profit   699,603     619,242     2,599,477     2,267,763
Operating expenses                      
  Research and development   348,253     336,641     1,359,725     1,335,834
  Sales, general and administrative   120,214     115,677     480,763     435,702
    Total operating expenses   468,467     452,318     1,840,488     1,771,536
Operating income   231,136     166,924     758,989     496,227
  Interest income   8,129     4,156     28,090     17,119
  Interest expense   11,594     7,935     46,133     10,443
  Other income, net   188     5,743     13,890     7,351
Income before income tax expense   227,859     168,888     754,836     510,254
Income tax expense   34,731     21,971     124,249     70,264
Net income $ 193,128   $ 146,917   $ 630,587   $ 439,990
                       
Net income per share:                      
  Basic $ 0.35   $ 0.26   $ 1.14   $ 0.75
  Diluted $ 0.35   $ 0.25   $ 1.12   $ 0.74
                       
Weighted average shares used in per share computation:                      
  Basic   544,170     568,483     552,319     587,893
  Diluted   556,573     577,356     563,068     594,517
                       
                       
NVIDIA CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
(Unaudited)
       
       
  January 25,   January 26,
  2015   2014
ASSETS          
           
Current assets:          
  Cash, cash equivalents and marketable securities $ 4,623,339   $ 4,671,810
  Accounts receivable, net   473,637     426,357
  Inventories   482,893     387,765
  Prepaid expenses and other current assets   133,428     138,779
    Total current assets   5,713,297     5,624,711
           
Property and equipment, net   557,282     582,740
Goodwill   618,179     643,179
Intangible assets, net   221,714     296,012
Other assets   90,896     104,252
    Total assets $ 7,201,368   $ 7,250,894
           
LIABILITIES AND STOCKHOLDERS' EQUITY          
           
Current liabilities:          
  Accounts payable $ 293,223   $ 324,391
  Accrued liabilities and other current liabilities   602,807     621,105
    Total current liabilities   896,030     945,496
           
Long-term debt   1,384,342     1,356,375
Other long-term liabilities   488,928     475,125
Capital lease obligations, long-term   14,086     17,500
Stockholders' equity   4,417,982     4,456,398
    Total liabilities and stockholders' equity $ 7,201,368   $ 7,250,894
           
           
NVIDIA CORPORATION  
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES  
(In thousands, except per share data)  
(Unaudited)  
                         
    Three Months Ended     Twelve Months Ended  
    January 25,     October 26,     January 26,     January 25,     January 26,  
    2015     2014     2014     2015     2014  
                                         
GAAP gross profit   $ 699,603     $ 676,698     $ 619,242     $ 2,599,477     $ 2,267,763  
  GAAP gross margin     55.9 %     55.2 %     54.1 %     55.5 %     54.9 %
    Stock-based compensation expense included in cost of revenue (A)     3,426       3,021       2,777       12,022       10,688  
    Legal settlement     -       -       1,450       -       3,740  
    Credit from a weak die/packaging material set (B)     -       -       (7,782 )     -       (7,782 )
  Non-GAAP gross profit   $ 703,029     $ 679,719     $ 615,687     $ 2,611,499     $ 2,274,409  
    Non-GAAP gross margin     56.2 %     55.5 %     53.8 %     55.8 %     55.1 %
                                         
  GAAP operating expenses   $ 468,467     $ 463,383     $ 452,318     $ 1,840,488     $ 1,771,536  
    Stock-based compensation expense included in operating expense (A)     (39,044 )     (38,414 )     (33,427 )     (145,819 )     (125,607 )
    Acquisition-related costs (B)     (9,169 )     (9,572 )     (9,250 )     (37,355 )     (31,652 )
    Other expense (C)     -       -       (1,845 )     -       (4,080 )
  Non-GAAP operating expenses   $ 420,254     $ 415,397     $ 407,796     $ 1,657,314     $ 1,610,197  
                                         
  GAAP other income (expense), net   $ (3,277 )   $ (4,245 )   $ 1,964     $ (4,153 )   $ 14,027  
    Gains and losses from non-affiliated investments     -       -       (3,074 )     (14,482 )     (3,074 )
    Interest expense related to amortization of debt discount     7,083       7,010       4,600       27,967       4,600  
  Non-GAAP other income (expense), net   $ 3,806     $ 2,765     $ 3,490     $ 9,332     $ 15,553  
                                         
  GAAP net income   $ 193,128     $ 172,967     $ 146,917     $ 630,587     $ 439,990  
    Total pre-tax impact of non-GAAP adjustments     58,722       58,017       42,493       208,681       169,511  
    Income tax impact of non-GAAP adjustments     (10,783 )     (10,549 )     (1,924 )     (38,280 )     (21,094 )
  Non-GAAP net income   $ 241,067     $ 220,435     $ 187,486     $ 800,988     $ 588,407  
                                         
  Diluted net income per share                                        
    GAAP   $ 0.35     $ 0.31     $ 0.25     $ 1.12     $ 0.74  
    Non-GAAP   $ 0.43     $ 0.39     $ 0.32     $ 1.42     $ 0.99  
                                         
  Shares used in diluted net income per share computation     556,573       558,201       577,356       563,068       594,517  
                                         
  Metrics:                                        
    GAAP net cash flow provided by operating activities   $ 442,729     $ 215,623     $ 400,712     $ 905,656     $ 835,146  
    Purchase of property and equipment and intangible assets     (31,045 )     (39,741 )     (66,374 )     (122,381 )     (255,186 )
    Free cash flow   $ 411,684     $ 175,882     $ 334,338     $ 783,275     $ 579,960  
                                             
                                         
(A) Excludes stock-based compensation as follows:     Three Months Ended       Twelve Months Ended  
      January 25,       October 26,       January 26,       January 25,       January 26,  
      2015       2014       2014       2015       2014  
    Cost of revenue   $ 3,426     $ 3,021     $ 2,777     $ 12,022     $ 10,688  
    Research and development   $ 23,719     $ 22,680     $ 21,548     $ 88,355     $ 82,940  
    Sales, general and administrative   $ 15,325     $ 15,734     $ 11,879     $ 57,464     $ 42,667  
                                         
(B) Consists of amortization of acquisition-related intangible assets, transaction costs, compensation charges, and other credits related to acquisitions.
(C) Includes intangible asset write-off, restructuring charge, and legal settlement cost, net of credits.
   
   
NVIDIA CORPORATION  
RECONCILIATION OF GAAP TO NON-GAAP OUTLOOK  
   
  Q1 FY2016 Outlook  
       
GAAP gross margin   56.2 %
  Impact of stock-based compensation   0.3 %
Non-GAAP gross margin   56.5 %
       
  Q1 FY2016 Outlook  
  (In millions)  
       
GAAP operating expenses $ 478  
  Stock-based compensation expense and acquisition-related costs   (53 )
Non-GAAP operating expenses $ 425  
       
       

About NVIDIA
Since 1993, NVIDIA (NASDAQ: NVDA) has pioneered the art and science of visual computing. The company's technologies are transforming a world of displays into a world of interactive discovery -- for everyone from gamers to scientists, and consumers to enterprise customers. More information at http://nvidianews.nvidia.com and http://blogs.nvidia.com.

Certain statements in this press release including, but not limited to statements as to: momentum accelerating in each of the company's market-specialized platforms; GeForce and SHIELD extending the company's reach in the rapidly growing global gaming market; GRID enabling enterprises to virtualize graphics-intensive applications; the Tesla accelerated computing platform helping to ignite the deep learning revolution; the growing importance of visual computing; the company's intent to return approximately $600 million to shareholders in fiscal 2016; a portion of the company's dividend payment being considered a return of capital; the company's financial outlook for the first quarter of fiscal 2016; the company's tax rates for the first quarter of fiscal 2016; and the benefits and features of the GeForce GTX 960 GPU, NVIDIA GRID vGPU, the NVIDIA Tesla Accelerated Computing Platform, the Tesla K80 dual-GPU accelerator, the Tegra X1 mobile processor and NVIDIA DRIVE are forward-looking statements that are subject to risks and uncertainties that could cause results to be materially different than expectations. Important factors that could cause actual results to differ materially include: global economic conditions; our reliance on third parties to manufacture, assemble, package and test our products; the impact of technological development and competition; development of new products and technologies or enhancements to our existing product and technologies; market acceptance of our products or our partners' products; design, manufacturing or software defects; changes in consumer preferences or demands; changes in industry standards and interfaces; unexpected loss of performance of our products or technologies when integrated into systems; as well as other factors detailed from time to time in the reports NVIDIA files with the Securities and Exchange Commission, or SEC, including its Form 10-Q for the fiscal period ended October 26, 2014. Copies of reports filed with the SEC are posted on the company's website and are available from NVIDIA without charge. These forward-looking statements are not guarantees of future performance and speak only as of the date hereof, and, except as required by law, NVIDIA disclaims any obligation to update these forward-looking statements to reflect future events or circumstances.

© 2015 NVIDIA Corporation. All rights reserved. NVIDIA, the NVIDIA logo, GeForce, GTX, Tegra, Tesla, GRID vGPU, Maxwell, NVLink, NVIDIA GRID, and SHIELD are trademarks and/or registered trademarks of NVIDIA Corporation in the U.S. and/or other countries. Other company and product names may be trademarks of the respective companies with which they are associated. Features, pricing, availability, and specifications are subject to change without notice.

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