NVIDIA Q2 FY 2011 Revenue Forecast Lowered

NVIDIA wasn't able to actually catch up to Advanced Micro Devices on the DirectX 11 market after its first two GeForce GTX 400 Series adapters entered the market. The mainstream offering, the GTX 460, has also not been in play for overly long. Meanwhile, the low-end and low cost integrated graphics markets seem to have grown. This put the Santa Clara, California-based company in somewhat of a tight spot, leading to its decision to reduce its revenue forecast.

Originally, NVIDIA hoped that the second quarter of its Fiscal Year 2011 would yield between $950 million and $970 million, but these hopes appear to have become far-fetched in the wake of such things as losing discrete GPU market dominance. Now, the company only expects a sum of between $800 million and $820 million at best.

This adjustments led to NVIDIA's shares falling 6.6 percent, or 67 cents, to $9.46 in extended trading. This sum is quite low compared to the $18.96 that those same stocks sold for about a year ago. Mostly, this forecast was made because the GPU maker bet on the high-end market and has not yet managed to provide the lower segments with suitable alternatives to its previous generation of video controllers. Thus, it is this "greater-than-expected shift to lower-priced GPUs and PCs with integrated graphics” that is seen as the culprit. It remains to be seen just how severely the consumer GPU business is actually hurt by the current trends.

The second quarter of Fiscal year 2010 will end on the first of August. NVIDIA will announce final results on the 12 of the same month.

"Additional commentary pertaining to the second quarter will be available when Nvidia reports its second quarter financial results on Aug. 12, 2010," the company said in a press release issued on Wednesday.