NVIDIA Just Can’t Make Enough GPUs
NVIDIA recently had an amazing quarter. The company more than doubled its earnings. It scored its first billion dollars. NVIDIA is the first dedicated “GPU company to reach the billion dollar quarter level”.
Nevertheless things could have been better. For NVIDIA was and still is capacity constrained.
Capacity Limited
In the quarter before last, NVIDIA had phenomenal results too. The stock, however, took a dive. Why?
The reason the stock took a dive, quarter before last, was NVIDIA’s foundry partner–TSMC–was running at or near capacity. Things were thus “tight from a capacity perspective”.
In the event, it turned out that NVIDIA was production limited in two primary areas. Motherboard GPUs and some GeForce 8 parts were “capacity limited or production limited”.
In particular it was motherboard GPUs for Intel and GeForce 8800 GT devices that were capacity constrained. Capacity in fact still is constrained. These GPUs NVIDIA “just can’t make enough of”.