[ Back ]   [ More News ]   [ Home ]
NVIDIA Announces Financial Results for the Fourth Quarter and Fiscal 2016

SANTA CLARA, CA -- (Marketwired) -- Feb 17, 2016 -- NVIDIA (NASDAQ: NVDA) --

NVIDIA (NASDAQ: NVDA) today reported record revenue for the fourth quarter ended January 31, 2016, of $1.40 billion, up 12 percent from $1.25 billion a year earlier, and up 7 percent from $1.30 billion in the previous quarter.

Revenue for fiscal 2016 was a record $5.01 billion, up 7 percent from $4.68 billion a year earlier.

GAAP earnings per diluted share for the quarter were $0.35, inclusive of a restructuring charge of $0.04 per diluted share. Non-GAAP earnings per diluted share were $0.52, up 21 percent from $0.43 a year earlier and up 13 percent from $0.46 in the previous quarter.

GAAP earnings per diluted share for the full year were $1.08, inclusive of restructuring charges of $0.15 per diluted share. Non-GAAP earnings per diluted share were $1.67, up 18 percent from $1.42 a year earlier.

"We had another record quarter, capping a record year," said Jen-Hsun Huang, co-founder and chief executive officer, NVIDIA. "Our strategy is to create specialized accelerated computing platforms for large growth markets that demand the 10x boost in performance we offer. Each platform leverages our focused investment in building the world's most advanced GPU technology.

"NVIDIA is at the center of four exciting growth opportunities -- PC gaming, VR, deep learning, and self-driving cars. We are especially excited about deep learning, a breakthrough in artificial intelligence algorithms that takes advantage of our GPU's ability to process data simultaneously.

"Deep learning is a new computing model that teaches computers to find patterns and make predictions, extracting powerful insights from massive quantities of data. We are working with thousands of companies that are applying the power of deep learning in fields ranging from life sciences and financial services to the Internet of Things," he said.

Capital Return
During the fourth quarter, NVIDIA paid $62 million in cash dividends and received 4.3 million shares in connection with an accelerated share repurchase agreement that it had entered into in the quarter. During fiscal 2016, the company returned to shareholders $800 million in quarterly cash dividends and share repurchases.

For fiscal 2017, NVIDIA intends to return approximately $1.0 billion to shareholders through ongoing quarterly cash dividends and share repurchases.

NVIDIA will pay its next quarterly cash dividend of $0.115 per share on March 23, 2016, to all shareholders of record on March 2, 2016.

Q4 FY2016 Summary

                                                                            
----------------------------------------------------------------------------
                                    GAAP                                    
----------------------------------------------------------------------------
($ in millions except                                                       
 earnings per share)           Q4 FY16  Q3 FY16  Q4 FY15    Q/Q       Y/Y   
----------------------------------------------------------------------------
Revenue                         $1,401   $1,305   $1,251     up 7%    up 12%
----------------------------------------------------------------------------
Gross margin                     56.5%    56.3%    55.9% up 20 bps up 60 bps
----------------------------------------------------------------------------
Operating expenses                $539     $489     $468    up 10%    up 15%
----------------------------------------------------------------------------
Operating income                  $252     $245     $231     up 3%     up 9%
----------------------------------------------------------------------------
Net income                        $207     $246     $193  down 16%     up 7%
----------------------------------------------------------------------------
Diluted earnings per share       $0.35    $0.44    $0.35  down 20%        --
----------------------------------------------------------------------------
                                                                            
                                                                            
----------------------------------------------------------------------------
                                  Non-GAAP                                  
----------------------------------------------------------------------------
($ in millions except                                                       
 earnings per share)       Q4 FY16   Q3 FY16   Q4 FY15     Q/Q        Y/Y   
----------------------------------------------------------------------------
Revenue                      $1,401    $1,305    $1,251     up 7%     up 12%
----------------------------------------------------------------------------
Gross margin                  57.2%     56.5%     56.2% up 70 bps up 100 bps
----------------------------------------------------------------------------
Operating expenses             $445      $430      $420     up 3%      up 6%
----------------------------------------------------------------------------
Operating income               $356      $308      $283    up 16%     up 26%
----------------------------------------------------------------------------
Net income                     $297      $255      $241    up 16%     up 23%
----------------------------------------------------------------------------
Diluted earnings per          $0.52     $0.46     $0.43    up 13%     up 21%
 share                                                                      
----------------------------------------------------------------------------
                                                                            
 

FY2016 Summary

----------------------------------------------------------------------------
                                    GAAP                                    
----------------------------------------------------------------------------
($ in millions except earnings per share)            FY16    FY15     Y/Y   
----------------------------------------------------------------------------
Revenue                                             $5,010  $4,682     up 7%
----------------------------------------------------------------------------
Gross margin                                         56.1%   55.5% up 60 bps
----------------------------------------------------------------------------
Operating expenses                                  $2,064  $1,840    up 12%
----------------------------------------------------------------------------
Operating income                                      $747    $759   down 2%
----------------------------------------------------------------------------
Net income                                            $614    $631   down 3%
----------------------------------------------------------------------------
Diluted earnings per share                           $1.08   $1.12   down 4%
----------------------------------------------------------------------------
                                                                            
                                                                            
----------------------------------------------------------------------------
                                  Non-GAAP                                  
----------------------------------------------------------------------------
($ in millions except earnings per share)           FY16    FY15      Y/Y   
----------------------------------------------------------------------------
Revenue                                            $5,010  $4,682      up 7%
----------------------------------------------------------------------------
Gross margin                                        56.8%   55.8% up 100 bps
----------------------------------------------------------------------------
Operating expenses                                 $1,721  $1,657      up 4%
----------------------------------------------------------------------------
Operating income                                   $1,125    $954     up 18%
----------------------------------------------------------------------------
Net income                                           $929    $801     up 16%
----------------------------------------------------------------------------
Diluted earnings per share                          $1.67   $1.42     up 18%
----------------------------------------------------------------------------
                                                                            

NVIDIA's outlook for the first quarter of fiscal 2017 is as follows:

Fourth Quarter Fiscal 2016 Highlights
During the fourth quarter, NVIDIA achieved progress in each of its platforms.

Gaming:

Professional Visualization:

Datacenter:

Auto:

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 2016 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 (212) 231-2927; 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 of fiscal 2017.

Non-GAAP Measures

To supplement NVIDIA's Condensed Consolidated Statements of Income 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 operating income, non-GAAP other income (expense), net, non-GAAP income tax expense, non-GAAP net income, non-GAAP net income, or earnings, per diluted share, non-GAAP diluted shares, per diluted share impact of restructuring and other charges, 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, product warranty charge, acquisition-related costs, restructuring and other charges, gains and losses from non-affiliated investments, interest expense related to amortization of debt discount, and the associated tax impact of these items, where applicable. Weighted average shares used in the non-GAAP diluted net income per share computation includes the anti-dilution impact of the company's Note Hedge. Per diluted share impact of restructuring and other charges is calculated as restructuring and other charges, net of income tax, divided by GAAP diluted shares. 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 its non-GAAP measures may be different from non-GAAP measures used by other companies.

Keep Current on NVIDIA
Subscribe to the NVIDIA blog, follow us on Facebook, Google+, Twitter, LinkedIn and Instagram, and view NVIDIA videos on YouTube and images on Flickr.

                                                                            
                             NVIDIA CORPORATION                             
                CONDENSED CONSOLIDATED STATEMENTS OF INCOME                 
                    (In millions, except per share data)                    
                                (Unaudited)                                 
                                                                            
                                                                            
                               Three Months Ended      Twelve Months Ended  
                             ----------------------  ---------------------- 
                               January     January     January     January  
                                 31,         25,         31,         25,    
                                2016        2015        2016        2015    
                             ----------  ----------  ----------  ---------- 
                                                                            
Revenue                      $    1,401  $    1,251  $    5,010  $    4,682 
Cost of revenue                     610         552       2,199       2,083 
                             ----------  ----------  ----------  ---------- 
Gross profit                        791         699       2,811       2,599 
Operating expenses                                                          
  Research and development          344         348       1,331       1,360 
  Sales, general and                                                        
   administrative                   161         120         602         480 
  Restructuring and other                                                   
   charges                           34           -         131           - 
                             ----------  ----------  ----------  ---------- 
    Total operating expenses        539         468       2,064       1,840 
                             ----------  ----------  ----------  ---------- 
Operating income                    252         231         747         759 
  Interest income                    11           8          39          28 
  Interest expense                  (12)        (12)        (47)        (46)
  Other income, net                   2           1           4          14 
                             ----------  ----------  ----------  ---------- 
Income before income tax                                                    
 expense                            253         228         743         755 
Income tax expense                   46          35         129         124 
                             ----------  ----------  ----------  ---------- 
Net income                   $      207  $      193  $      614  $      631 
                             ==========  ==========  ==========  ========== 
                                                                            
Net income per share:                                                       
  Basic                      $     0.38  $     0.35  $     1.13  $     1.14 
                             ==========  ==========  ==========  ========== 
  Diluted                    $     0.35  $     0.35  $     1.08  $     1.12 
                             ==========  ==========  ==========  ========== 
                                                                            
Weighted average shares used                                                
 in per share computation:                                                  
  Basic                             539         544         543         552 
  Diluted                           593         557         569         563 
                                                                            
                                                                            
                             NVIDIA CORPORATION                             
                    CONDENSED CONSOLIDATED BALANCE SHEETS                   
                                (In millions)                               
                                 (Unaudited)                                
                                                                            
                                                                            
                                                 January 31,    January 25, 
                                                    2016           2015     
                                               -------------- --------------
ASSETS                                                                      
                                                                            
Current assets:                                                             
  Cash, cash equivalents and marketable                                     
   securities                                  $        5,037 $        4,623
  Accounts receivable, net                                505            474
  Inventories                                             418            483
  Prepaid expenses and other current assets                93            133
                                               -------------- --------------
    Total current assets                                6,053          5,713
                                                                            
Property and equipment, net                               466            557
Goodwill                                                  618            618
Intangible assets, net                                    166            222
Other assets                                               67             91
                                               -------------- --------------
    Total assets                               $        7,370 $        7,201
                                               ============== ==============
                                                                            
LIABILITIES, CONVERTIBLE DEBT CONVERSION OBLIGATION AND SHAREHOLDERS' EQUITY
                                                                            
Current liabilities:                                                        
  Accounts payable                             $          296 $          293
  Accrued and other current liabilities                   642            603
  Convertible short-term debt                           1,413              -
                                               -------------- --------------
    Total current liabilities                           2,351            896
                                                                            
Convertible long-term debt                                  -          1,384
Other long-term liabilities                               453            489
Capital lease obligations, long-term                       10             14
                                               -------------- --------------
    Total liabilities                                   2,814          2,783
                                                                            
Convertible debt conversion obligation                     87              -
                                                                            
Shareholders' equity                                    4,469          4,418
                                               -------------- --------------
    Total liabilities, convertible debt                                     
     conversion obligation and shareholders'                                
     equity                                    $        7,370 $        7,201
                                               ============== ==============
                                                                            
                                                                            
                             NVIDIA CORPORATION                             
           RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES            
                    (In millions, except per share data)                    
                                (Unaudited)                                 
                                                                            
                                Three Months Ended      Twelve Months Ended 
                          ----------------------------- ------------------- 
                           Jan. 31,  Oct. 25,  Jan. 25,  Jan. 31,  Jan. 25, 
                             2016      2015      2015      2016      2015   
                          --------- --------- --------- --------- --------- 
                                                                            
GAAP gross profit         $     791 $     734 $     699 $   2,811 $   2,599 
  GAAP gross margin            56.5%     56.3%     55.9%     56.1%     55.5%
  Stock-based                                                               
   compensation expense                                                     
   (A)                            5         4         4        15        12 
  Product warranty charge                                                   
   (B)                            5         -         -        20         - 
                          --------- --------- --------- --------- --------- 
Non-GAAP gross profit     $     801 $     738 $     703 $   2,846 $   2,611 
                          ========= ========= ========= ========= ========= 
  Non-GAAP gross margin        57.2%     56.5%     56.2%     56.8%     55.8%
                                                                            
GAAP operating expenses   $     539 $     489 $     468 $   2,064 $   1,840 
  Stock-based                                                               
   compensation expense                                                     
   (A)                          (56)      (47)      (39)     (190)     (146)
  Acquisition-related                                                       
   costs ©                     (4)       (4)       (9)      (22)      (37)
  Restructuring and other                                                   
   charges                      (34)       (8)        -      (131)        - 
                          --------- --------- --------- --------- --------- 
Non-GAAP operating                                                          
 expenses                 $     445 $     430 $     420 $   1,721 $   1,657 
                          ========= ========= ========= ========= ========= 
                                                                            
GAAP operating income     $     252 $     245 $     231 $     747 $     759 
  Total impact of non-                                                      
   GAAP adjustments to                                                      
   operating income             104        63        52       378       195 
                          --------- --------- --------- --------- --------- 
Non-GAAP operating income $     356 $     308 $     283 $   1,125 $     954 
                          ========= ========= ========= ========= ========= 
                                                                            
GAAP other income                                                           
 (expense), net           $       1 $       - $      (3)$      (4)$      (4)
  Gains from non-                                                           
   affiliated investments         -        (4)        -        (5)      (15)
  Interest expense                                                          
   related to                                                               
   amortization of debt                                                     
   discount                       7         7         7        29        28 
                          --------- --------- --------- --------- --------- 
Non-GAAP other income,                                                      
 net                      $       8 $       3 $       4 $      20 $       9 
                          ========= ========= ========= ========= ========= 
                                                                            
GAAP net income           $     207 $     246 $     193 $     614 $     631 
  Total pre-tax impact of                                                   
   non-GAAP adjustments         111        66        59       402       208 
  Income tax impact of                                                      
   non-GAAP adjustments         (21)      (57)      (11)      (87)      (38)
                          --------- --------- --------- --------- --------- 
Non-GAAP net income       $     297 $     255 $     241 $     929 $     801 
                          ========= ========= ========= ========= ========= 
                                                                            
Diluted net income per                                                      
 share                                                                      
  GAAP                    $    0.35 $    0.44 $    0.35 $    1.08 $    1.12 
                          ========= ========= ========= ========= ========= 
  Non-GAAP                $    0.52 $    0.46 $    0.43 $    1.67 $    1.42 
                          ========= ========= ========= ========= ========= 
                                                                            
Weighted average shares                                                     
 used in diluted net                                                        
 income per share                                                           
 computation                                                                
  GAAP                          593       565       557       569       563 
  Anti-dilution impact                                                      
   from note hedge (D)          (26)      (10)        -       (13)        - 
                          --------- --------- --------- --------- --------- 
  Non-GAAP                      567       555       557       556       563 
                          ========= ========= ========= ========= ========= 
                                                                            
Metrics:                                                                    
  Restructuring and other                                                   
   charges                $      34 $       8 $       - $     131 $       - 
    Income tax impact of                                                    
     restructuring and                                                      
     other charges               (9)      (50)        -       (45)        - 
                          --------- --------- --------- --------- --------- 
  Restructuring and other                                                   
   charges, net of income                                                   
   tax                    $      25 $     (42)$       - $      86 $       - 
  GAAP diluted shares           593       565         -       569         - 
                          --------- --------- --------- --------- --------- 
  Per diluted share                                                         
   impact of                                                                
   restructuring and                                                        
   other charges          $    0.04 $   (0.07)$       - $    0.15 $       - 
                          ========= ========= ========= ========= ========= 
                                                                            
  GAAP net cash provided                                                    
   by operating                                                             
   activities             $     510 $     255 $     443 $   1,175 $     906 
  Purchase of property                                                      
   and equipment and                                                        
   intangible assets            (15)      (16)      (31)      (86)     (123)
                          --------- --------- --------- --------- --------- 
  Free cash flow          $     495 $     239 $     412 $   1,089 $     783 
                          ========= ========= ========= ========= ========= 
                                                                            
----------------------------------------------------------------------------
(A) Excludes stock-based                                                    
 compensation as follows:       Three Months Ended      Twelve Months Ended 
                          ----------------------------- ------------------- 
                           Jan. 31,  Oct. 25,  Jan. 25,  Jan. 31,  Jan. 25, 
                             2016      2015      2015      2016      2015   
                          --------- --------- --------- --------- --------- 
  Cost of revenue         $       5 $       4 $       4 $      15 $      12 
  Research and                                                              
   development            $      33 $      28 $      23 $     115 $      88 
  Sales, general and                                                        
   administrative         $      22 $      19 $      15 $      74 $      57 
                                                                            
(B) Represents warranty charge associated with a product recall.            
                                                                            
© Consists of amortization of acquisition-related intangible assets,      
 transaction costs, compensation charges, and other credits related to      
 acquisitions.                                                              
                                                                            
(D) Represents the number of shares that would be delivered upon conversion 
 of the currently outstanding 1.00% Convertible Senior Notes Due 2018.      
 Under U.S. GAAP, shares delivered in hedge transactions are not considered 
 offsetting shares in the fully diluted share calculation until actually    
 delivered.                                                                 
----------------------------------------------------------------------------
                                                                            
                                                                            
                             NVIDIA CORPORATION                             
                 RECONCILIATION OF GAAP TO NON-GAAP OUTLOOK                 
                                                                            
                                                                            
                                                         Q1 FY2017 Outlook  
                                                        ------------------- 
                                                                            
GAAP gross margin                                                      57.2%
  Impact of stock-based compensation                                    0.3%
                                                        ------------------- 
Non-GAAP gross margin                                                  57.5%
                                                        =================== 
                                                                            
                                                                            
                                                         Q1 FY2017 Outlook  
                                                        ------------------- 
                                                           (In millions)    
                                                                            
GAAP operating expenses                                 $               500 
  Stock-based compensation expense and acquisition-                         
   related costs                                                        (55)
                                                        ------------------- 
Non-GAAP operating expenses                             $               445 
                                                        =================== 
                                                                            

About NVIDIA
Since 1993, NVIDIA (NASDAQ: NVDA) has pioneered the art and science of visual computing. With a singular focus on this field, the company offers specialized platforms for the gaming, professional visualization, datacenter and automotive markets. Its products, services and software power amazing new experiences in virtual reality, artificial intelligence and autonomous cars. More information at http://nvidianews.nvidia.com.

Certain statements in this press release including, but not limited to statements as to: the company's strategy of creating specialized accelerated computing platforms for large growth markets; the 10x boost in performance the company offers; the company being at the center of four exciting growth opportunities; the impact of deep learning; the company's intended fiscal 2017 capital return; the company's next quarterly cash dividend; the company's financial outlook for the first quarter of fiscal 2017; the company's tax rates for the first quarter of fiscal 2017; the impact of the GeForce GTX VR Ready program; the benefits of NVIDIA Iray plugins; the impact of the company's hyperscale datacenter deep learning platform; breakthroughs from web-services groups leveraging NVIDIA GPUs and Volvo's use of DRIVE PX 2 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 25, 2015. 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.

© 2016 NVIDIA Corporation. All rights reserved. NVIDIA, the NVIDIA logo, GeForce, Tesla, Iray, NVIDIA DesignWorks, NVIDIA DRIVE, NVIDIA GameWorks, 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.

For further information, contact:

Arnab Chanda
Investor Relations
NVIDIA Corporation
(408) 566-6616

achanda@nvidia.com

Robert Sherbin
Corporate Communications
NVIDIA Corporation
(408) 566-5150

rsherbin@nvidia.com