NVIDIA Denies Rumors of Faulty GPU Chips
Techtree News Staff, Jul 17, 2008 2200 hrs IST
NVIDIA feels the heat after stocks tumbled 24% when rumors of faulty GPU chips surfaced.
In the first week of July, Nvidia's stock had tumbled down as much as 24% after hours trading. As reported by Inquirer, this was attributed to the news about faulty notebook chips. Nvidia said that "significant quantities" of GPU and MCP chips experienced thermal issues and resulted in dead or damaged notebooks. Possibly due to faulty packaging or weak die, the chips gave overheat or failure issues.
Several Nvidia forums, as well as OEM forums like Dell and HP, were loaded with rants and complaints of system failures due to Nvidia's faulty G84 and G86 series notebook chips. Nvidia didn't directly admit to the failures publicly, but an emergency driver was released that powered up fans to increase cooling. That might've been quite a noisy affair for some!
The company later filed a report with Security and Exchange Commission to take $150 to $200 million one-time charge to recover "anticipated customer warranty, repair, return, replacement and other costs and expenses from a weak die/packaging material set in certain versions of our previous generation MCP and GPU products used in notebook systems".
In the report, Nvidia specified that only a few notebook chips shipped were found faulty and that possible issues depend upon several external factors like environment, usage, and system configuration. However, no Nvidia-based desktops had issues.
Nvidia's CEO, Jen-Hsun Huang admitted to having learnt a lesson from the "higher than normal failing rates" and that it will be taken care of in future by working closely with PC manufacturers. The Q2 earnings would be somewhere between $875 to $ 950 million due to chipset delays, recession in the end-user market and competition pressure leading to price cut.
Call it an aggressive conspiracy by news media against Nvidia or fair play by Nvidia for acting diplomatically against the allegations of "massive" chip failures. Whatever truth is, we'd like to say this Nvidia - play it safe!
USER COMMENTS
Er, the title does not reflect the content. I don't see anywhere in the article where Nvidia is "denying" faulty chips .. infact they admitted to it.
by Anand, Bangalore, on Jul 18, 2008 12:36 AM, Report abuse Reply
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I guess the so called news Staff has been drugged... Idiots... Put some Heading & the whole article is just Opposite.. Pathetic Lethargic Employees
by Gadget Guy, Hyderabad, on Jul 18, 2008 03:07 AM, Report abuse Reply