Nvidia’s flagship mobile Tegra SoC has managed to clinch a number of design wins, and can be found inside Google’s Nexus 7 tablet, Microsoft’s Windows RT Surface, Lenovo’s IdeaPad Yoga 11 and Ouya’s upcoming Android-powered console.
According to analysts at Trefis, Nvidia earned $765 million from Tegra sales in 2012, a near 30% increase compared to 2011. Meanwhile, Nvidia-powered tablets were up by almost 100% and remain the most important driver for its progress in the mobile computing space.
“However, the company’s progress in smartphones remains more or less stable with only a few design wins such as the HTC One X and LG Optimus 4X, to its credit,” the Trefis team said in an industry note.
“We believe that the introduction of Nvidia’s next generation Tegra 4 family – Tegra 4 and Tegra 4i – will help it make a deeper foray in the mobile market, especially smartphones.”
Currently, Nvidia earns approximately 18% of its revenue from Tegra processors, although the company is facing increased competition from Qualcomm formidable Snapdragon lineup.
“The introduction of Qualcomm’s third-generation processors will further step up competition for Nvidia. Qualcomm claims to have already bagged a significant number of design wins for mid-range and high end smartphones and tablets, powered by its Snapdragon 800 and Snapdragon 600 processors,” the analysts stated.
“The new Snapdragon lineup, which will be available in commercial devices by mid-2013, is estimated to deliver as high as 40% improved performance compared to Qualcomm’s S4 Pro processor.”
The Trefis team also confirmed that Nvidia also faces chip competition from a number of other industry heavyweights, including Broadcom, Marvell, MediaTek, Apple and Samsung – particularly the latter two companies who design their own chips in house and could potentially sell the silicon to device manufacturers in the future.
“Higher Tegra revenues has helped cushion the persistent weakness in the PC market. While most of its competitors including Intel, AMD and Texas Instruments posted annual decline in 2012, Nvidia saw 7% earnings growth during the same period. We believe that Tegra’s contribution to Nvidia’s overall revenue could reach over 25% by 2019,” the analysts added.
