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Old 09-14-03, 05:23 AM   #103
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Join Date: Sep 2003
Posts: 11

Originally posted by rabblerouser

I disagree with your assessment regarding nvidia as an investment, etc. The company has not been doing well lately. Sure it did not lose any marketshare in the discrete desktop segment as of the last marketshare report but they lost about 4-5% overall (with a lot more in the mobile segment). I also see nvidia's discrete desktop graphics share falling in the next couple of quarters. Financially the company has disappointed Wall Street in the last few quarters as well and they have high production costs on the FX 5600/5900 series which is hurting margins.

In addition to that stuff, they have also lost the win for xbox2. Xbox revenues were about 20% of total revenues for the last quarter which is a big chunk and xbox also accounted for most of nvda's revenue rise over the previous quarter. So you can take that away in 2005 or 2006 whenever the next xbox comes out. nvidia will have to grow their revenues per quarter by that much by 2005 just to get back to where they are today in revenues.

These driver/benchmark issues with nvda only are going to make life more difficult for nvidia. Even if the FX series was on par with the 9600/9800 pro in performance and quality, nvidia would suffer because they have been no. 1 in both for the last 3 years. 9700/9800 series really only began to kick in this year and it takes a while to filter down and into the market. I think it has only been about 4-5 months that Ati's 9600/9800 series has really begun to enjoy success on a large scale.

When nvidia had the tnt2 and were starting to beat 3dfx, it still took quite a while for them to beat off Ati from OEM deals and I expect the same to happen here. Nvidia is also enjoying quite a bit of success with the "DX9" 5200 series, but Ati will have a response to that at the end of the year or early next year with their own budget dx9 card, and it will almost certainly be a lot faster on dx9 games.

The better Ati does, the tougher it will be for nvda even in markets they do not directly compete in. For instance, Ati will have the RS300 chipset out soon which should be a good earner for Ati and will allow them to pour back more into R&D, etc.

Nvidia also doesn't seem to be on as good terms as they used to be with both MSFT and Intel, while Ati is very cozy with both at the moment.

Anyway I think that nvidia has a very challenging time coming up in the next year or two and I wouldn't want to be holding the stock through that unless they can reclaim their performance/quality lead on at least the desktop segment. I'd say that ati would be a better investment at this point.
Well.. when it comes to stocks, you tend to make money by buying low and selling high.. Since this is video card forum, I won't say much, but if NV40 solves problems in NV3x and manages to trump R420, NVDA will be back pretty quickly (it's no longer the startup that hit with TNT you know...) Business IS better at ATI, but ATYT is kinda expensive..
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