Nvidia Profit Falls; Stock Down 3%

(RTTNews) - Graphics chip maker Nvidia Corp (NVDA) on Thursday reported first-quarter net earnings of $134 million or $0.24 per share compared with $137 million or $0.24 per share last year.

Excluding items, adjusted earnings for the quarter were $0.33 per share compared with $0.29 per share a year ago.

Revenues for the quarter were up 4 percent at $1.15 billion compared with $1.10 billion in the prior year.

Analysts polled by Thomson Reuters estimated earnings of $0.26 per share on revenues of $1.16 billion for the quarter. Analysts' estimates typically exclude special items.

Gross margin improved to 56.7 percent from 54.8 percent a year earlier.

Operating expenses were higher at $477 million compared with $453 million last year.

For the second quarter, the company expects revenues of $1.01 billion, plus or minus two percent. Analysts expect revenues of $1.18 billion.

Nvidia, which is winding down its Icera business, said it will recognize related restructuring charges of up to $125 million, primarily during fiscal 2016.

The Icera wind-down or sale is expected to benefit non-GAAP operating expenses in the second half of the year and the company will invest in growth initiatives of deep learning, self-driving cars and gaming.

The company will return $800 million to shareholders in fiscal 2016, and raises quarterly cash dividend by 15 percent to $0.0975 per share.

Nvidia specializes in graphics processing units for PCs and video game consoles, while it has also expanded into the smartphone and tablet chip markets with its Tegra series. Recently, the company has also turned its focus on producing computing chips for high-end cars.