- Revenue of $1.15 billion, up 4 percent from $1.10 billion a year earlier
- Record GAAP gross margin of 56.7 percent, up from 54.8 percent a year earlier
- Decision to wind down or sell Icera modem operations
- Company to return $800 million to shareholders in fiscal 2016, raises quarterly cash dividend 15 percent to $0.0975 per share
NVIDIA (
GAAP earnings per diluted share for the quarter were $0.24, unchanged from $0.24 a year earlier and down 31 percent from $0.35 in the previous quarter. Non-GAAP earnings per diluted share were $0.33, up 14 percent from $0.29 a year earlier and down 23 percent from $0.43 in the previous quarter.
"The importance of visual computing is evident all around us," said Jen-Hsun Huang, president and chief executive officer of NVIDIA. "Our expertise in this field enables us to take a leading position to advance deep learning, virtual reality and self-driving cars.
"Our singular focus on visual computing is aligned with some of the most exciting growth opportunities in computing today," he said.
IP Litigation
The company is looking forward to its case against Samsung and Qualcomm, set to be heard in June at the U.S. International Trade Commission. Last month, NVIDIA received a favorable pretrial claim construction ruling in the case.
Icera Modem Operations
NVIDIA announced on May 5, 2015, that it will wind-down its Icera modem operations in the second quarter of fiscal 2016. It is open to a sale of the technology or operations.
The company estimates that it will recognize restructuring charges in the range of $100 million to $125 million, primarily during fiscal 2016. These charges will consist of severance and other employee termination benefits, tax expense items and other costs associated with the wind-down, if the company is unable to sell the modem operations.
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 carefully invest in its growth initiatives of deep learning, self-driving cars and gaming. Non-GAAP operating expenses in fiscal 2016 are expected to be approximately flat with the previous year, excluding litigation costs, which are anticipated to be in the range of $70 million to $90 million as the company defends its intellectual property.
Capital Return
During the first quarter, NVIDIA paid $46 million in cash dividends and repurchased 2.4 million shares. As a result, it returned an aggregate of $99 million to shareholders.
It has announced a 15 percent increase in its quarterly cash dividend to $0.0975 per share, from $0.085 per share. NVIDIA will pay its next quarterly cash dividend of $0.0975 per share on June 12, 2015, to all stockholders of record on May 21, 2015.
It also has announced an increase in its intended return to shareholders in fiscal 2016 to $800 million from the previously stated $600 million, through quarterly cash dividends and share repurchases.
Further, the company's board of directors has extended the previously authorized repurchase program through December 2018 and authorized an additional $1.62 billion, for an aggregate of $2.00 billion available for repurchase.
----------------------------------------------------------------------------
GAAP Quarterly Financial Comparison
----------------------------------------------------------------------------
($ in millions except
earnings per share) Q1 FY16 Q4 FY15 Q1 FY15 Q/Q Y/Y
----------------------------------------------------------------------------
Revenue $1,151 $1,251 $1,103 down 8% up 4%
----------------------------------------------------------------------------
Gross margin 56.7% 55.9% 54.8% up 80 bps up 190 bps
----------------------------------------------------------------------------
Operating expenses $477 $468 $453 up 2% up 5%
----------------------------------------------------------------------------
Net income $134 $193 $137 down 31% down 2%
----------------------------------------------------------------------------
Diluted earnings per
share $0.24 $0.35 $0.24 down 31% --
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Non-GAAP Quarterly Financial Comparison
----------------------------------------------------------------------------
($ in millions except
earnings per share) Q1 FY16 Q4 FY15 Q1 FY15 Q/Q Y/Y
----------------------------------------------------------------------------
Revenue $1,151 $1,251 $1,103 down 8% up 4%
----------------------------------------------------------------------------
Gross margin 56.9% 56.2% 55.1% up 70 bps up 180 bps
----------------------------------------------------------------------------
Operating expenses $425 $420 $411 up 1% up 3%
----------------------------------------------------------------------------
Net income $187 $241 $166 down 22% up 13%
----------------------------------------------------------------------------
Diluted earnings per
share $0.33 $0.43 $0.29 down 23% up 14%
----------------------------------------------------------------------------
