Nvidia will survive these setbacks. They're large enough that they can dig themselves out of this hole. AMD, on the other hand, is not so lucky. Because the economy isn't doing so well, everything is going to hell for them. Even though they made a fabulous product and priced it well below Nvidia's offerings, it doesn't help that the economy sucks right now. If they continue like this though, they will eventually be profitable again.
Nice Scrubs clip btw.