NVIDIA's revenue hits a record $1.20 billion for Q3 powered by Tegra 3 tablets, Kepler GPUs

NVIDIA Reports Financial Results for Third Quarter Fiscal Year 2013
NVIDIA Initiates Dividend; Extends Share-Repurchase Authorization

Nov 08, 2012 (Marketwire via COMTEX) --NVIDIA (NASDAQ: NVDA)

Record revenue of $1.20 billion.
GAAP net income was $209.1 million, or $0.33 per diluted share. Non-GAAP net income was $245.5 million, or $0.39 per diluted share.
GAAP gross margin was a record 52.9 percent. Non-GAAP gross margin was a record 53.1 percent.
NVIDIA initiated quarterly dividend of 7.5 cents a share.

NVIDIA (NASDAQ: NVDA) today reported record revenue of $1.20 billion for the third quarter of fiscal 2013 ended Oct. 28, 2012, up 15.3 percent from the previous quarter and up 12.9 percent from a year earlier.

The company also announced that it is initiating the payment of a quarterly cash dividend, and extending its existing $2.7 billion share-repurchase program, initiated in August 2004, through December 2014.

"Investments in our new growth strategies paid off this quarter in record revenues and margins," said Jen-Hsun Huang, president and chief executive officer of NVIDIA. "Kepler GPUs are winning across the special-purpose PC markets we serve, from gaming to design to supercomputing. And Tegra is powering some of the most innovative tablets, phones and cars in the market."

He continued: "We are pleased to start paying our shareholders a quarterly cash dividend. We have confidence in our businesses and our continued ability to grow. Given our strong financial position and ongoing ability to generate cash, we are well positioned to continue investing in our future."

GAAP Quarterly Financial Comparison
(in millions except per share data) Q3 FY13 Q2 FY13 Q3 FY12 Q/Q Y/Y
Revenue $1,204.1 $1,044.3 $1,066.2 up 15.3% up 12.9%
Gross margin 52.9% 51.8% 52.2% up 1.1 p.p up 0.7 p.p
Operating expenses $384.4 $401.1 $359.6 down 4.2% up 6.9%
Net income $209.1 $119.0 $178.3 up 75.6% up 17.3%
Earnings per share $0.33 $0.19 $0.29 up 73.7% up 13.8%

Non-GAAP Quarterly Financial Comparison*
(in millions except per share data) Q3 FY13 Q2 FY13 Q3 FY12 Q/Q Y/Y
Revenue $1,204.1 $1,044.3 $1,066.2 up 15.3% up 12.9%
Gross margin 53.1% 52.0% 52.5% up 1.1 p.p up 0.6 p.p
Operating expenses $344.8 $342.5 $317.6 up 0.7% up 8.6%
Net income $245.5 $170.4 $217.0 up 44.0% up 13.1%
Earnings per share $0.39 $0.27 $0.35 up 44.4% up 11.4%

*Non-GAAP earnings excluded stock-based compensation, amortization of acquisition-related intangible assets, other acquisition-related costs, a contribution expense in the second quarter of fiscal 2013, and the tax impact associated with such items.

Outlook

Our outlook for the fourth quarter of fiscal 2013 is as follows:

Revenue is expected to be between $1.025 billion and $1.175 billion.

GAAP and non-GAAP gross margins are expected to be flat relative to the prior quarter, 52.9 percent and 53.1 percent, respectively.

GAAP operating expenses are expected to be approximately $400 million; non-GAAP operating expenses are expected to be approximately $359 million.

GAAP and non-GAAP tax rates are expected to be approximately 20 percent and 19 percent, respectively, plus or minus one percentage point. This estimate excludes any discrete tax events that may occur during the quarter, which, if realized, may increase or decrease our actual fourth quarter GAAP and non-GAAP tax rates. If the U.S. research tax credit is reinstated into tax law, we estimate our annual effective tax rate for the fiscal year 2013 to be approximately 16 percent.

Depreciation and amortization for the fourth quarter is estimated to be approximately $58 million to $60 million. Capital expenditures are expected to be in the range of $60 million to $70 million.

Diluted shares for the fourth quarter are expected to be approximately 629 million.

Dividend and Share-Repurchase Program

The quarterly dividend of 7.5 cents per share, 30 cents on an annual basis, is equivalent to a yield of about 2.4 percent, based on the Nov. 7 closing price of $12.61. It will be payable on Dec. 14, 2012 to all shareholders of record on Nov. 23, 2012.

Since NVIDIA initiated its repurchase program in August 2004, NVIDIA has spent $1.46 billion to repurchase 90.9 million shares of its common stock. NVIDIA is authorized, subject to certain specifications, to spend up to an additional $1.24 billion repurchasing shares of its common stock.

Any future repurchases would be made in the open market, in privately negotiated transactions or in structured share-repurchase programs, and may be made from time to time or in one or more larger repurchases. The program will be conducted in compliance with the Securities and Exchange Commission's Rule 10b-18 and applicable legal requirements and shall be subject to market conditions and other factors. The repurchases would be funded from available working capital.

Cash, cash equivalents and marketable securities at the end of the third quarter of fiscal 2013 were $3.43 billion.

Third Quarter Fiscal 2013 and Recent Highlights:

Microsoft launched its NVIDIA Tegra® 3-based Surface RT to critical acclaim.

NVIDIA's new energy-efficient Kepler™ GPU architecture continued to make excellent headway:

Kepler-based gaming was extended to new, lower price points with the launch of the GeForce® 660 Ti, GeForce GTX 660, GeForce GTX 650 Ti and GeForce GTX 650.
Kepler made further inroads in supercomputing, as Oak Ridge National Laboratory announced that it had completed Titan, the world's fastest open-science supercomputer. Titan gets 90 percent of its processing power from 18,688 NVIDIA Tesla® GPUs.
Kepler moved further into Apple's lineup, with the NVIDIA Quadro® K5000 for Mac Pro users.
NVIDIA launched the VGX™ K2 GPU, also based on the Kepler GPU, for cloud-based workstation graphics.

CFO Commentary
Commentary on the quarter by Karen Burns, NVIDIA interim chief financial officer, is available at www.nvidia.com/ir.

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T-Mobile USA Q3 2012 earnings: Revenue drops 6 percent to $4.9 billion, profit down 15 percent

Mobile USA Reports Third Quarter 2012 Operating Results

Net Customer Growth in the Third Quarter; Continued Year-on-Year Churn Improvements

Third Quarter 2012 Highlights

Operational Highlights:

-Net customer additions of 160,000 reflect strong net additions of 365,000 branded prepaid customers
-Branded contract churn of 2.3% improved 30 basis points year-on-year
-Rate of branded net contract customer losses in the third quarter of 2012 improved slightly sequentially (492,000 in Q3/12 compared to 557,000 in Q2/12) but increased year-on-year (389,000 in Q3/11) due to the impact of the iPhone 5 launch
-3G/4G smartphones sales accounted for 77% of units sold and increased 28% year-on-year to 2.3 million units
-The $4 billion 4G network modernization plan is well underway; first cities with HSPA+ on -1900 PCS spectrum launched in the third quarter of 2012
-New Unlimited Nationwide 4G Data plan, launched in September, is a key differentiator in the marketplace

Summary of Financial Results:

-Total revenues of $4.9 billion, a decrease of 6.4% year-on-year, reflecting higher equipment revenues from the Company's new Value plans; total service revenues were $4.3 billion, a decrease of 8.7% year-on-year
-Branded prepaid revenues increased to $450 million, a 38% increase year-on-year
-Growth in Monthly 4G plans drove prepaid ARPU to $27.35, up 12.5% year-on-year
-Branded contract data ARPU of $19.45 increased 10.4% year-on-year
-Branded contract ARPU declined 3.3% year-on-year to $56.59 in part due to the popularity of the Value plans, which now account for nearly one-quarter of branded contract customers
-Adjusted OIBDA of $1.2 billion decreased 15.2% year-on-year in the third quarter of 2012 largely due to higher advertising expenses
-Adjusted OIBDA margin of 29% declined 2 percentage points sequentially and year-on-year

BELLEVUE, Wash.--(BUSINESS WIRE)--T-Mobile USA, Inc. ("T-Mobile") today reported its third quarter 2012 results, which demonstrate that successful execution of the Company's Challenger Strategy continues to improve performance in key operational and financial areas. T-Mobile ended the third quarter of 2012 with 33.3 million customers, a net addition of 160,000 customers compared to the second quarter of 2012. The sequential improvement was driven primarily by the continued expansion of branded prepaid customers and a reduction in branded contract net customer losses. The Company's branded prepaid customer growth was its best quarterly performance of this year and exceeded the annual growth reported in 2011.

"The combination of T-Mobile USA and MetroPCS will further deepen the Company's LTE spectrum position in key metropolitan areas and provide a path to an at least 20 by 20 MHz LTE deployment in 90% of the top 25 U.S. markets"
In the quarter, the Company reported adjusted OIBDA of $1.2 billion and an adjusted OIBDA margin of 29%. As expected, third quarter 2012 adjusted OIBDA reflects higher advertising expenditures related to the Company's brand re-launch.

"We continue to make solid progress with our Challenger Strategy, as evidenced by our strong performance in prepaid services, the growing attractiveness of our Value and Unlimited plans, the execution of our network modernization program, and the expansion of our popular handset portfolio," said John Legere, President and CEO of T-Mobile USA. "Our strategy, including our ability to deliver more affordable, faster 4G services to more customers in more metropolitan areas, will be significantly accelerated by our proposed combination with MetroPCS. With MetroPCS, we aim to become the industry's leading value carrier – for both prepaid and contract service offerings – with the scale, spectrum and financial resources to aggressively compete with the other national carriers."

"The combination of T-Mobile USA and MetroPCS will further deepen the Company's LTE spectrum position in key metropolitan areas and provide a path to an at least 20 by 20 MHz LTE deployment in 90% of the top 25 U.S. markets," said René Obermann, CEO of Deutsche Telekom.

T-Mobile Strategic Initiatives Update

T-Mobile continues to make significant progress in executing its Challenger Strategy. In September, John Legere was named President and Chief Executive Officer of T-Mobile and has reiterated his strong commitment to the Company's Challenger Strategy.

Amazing 4G Services Highlights:

T-Mobile continues to advance its $4 billion 4G network modernization plan, which includes installing new advanced equipment that paves the way for the launch of Long Term Evolution ("LTE") service in 2013.
Las Vegas and Kansas City were the first cities where T-Mobile customers benefited from the launch of HSPA+ on 1900 PCS spectrum, which delivers enhanced voice and data coverage, as well as faster speeds on unlocked devices such as the iPhone; just yesterday, Washington DC, Baltimore, and Houston also went live. The Company expects to announce further network strengthening in many additional cities in the coming months.
In the third quarter of 2012, T-Mobile completed the transaction announced in June 2012 with Verizon Wireless for the purchase and exchange of AWS spectrum licenses in 218 markets across the U.S. This transaction improved T-Mobile's spectrum position in 15 of the top 25 markets nationwide.
T-Mobile continued to expand its compelling 4G smartphone portfolio, including adding more devices under the popular Samsung Galaxy lineup, such as the Samsung Galaxy Note 2, and announcing the upcoming availability of two Windows Phone 8 smartphones, including the exclusive Nokia Lumia 810.
Value Leader Highlights:

T-Mobile is a champion of "bring your own device (BYOD)" wireless, with affordable value plans that separate the cost of wireless service from the purchase of a new phone.
In early September, T-Mobile launched a new Unlimited Nationwide 4G Data plan that is a key differentiator in the marketplace.
Trusted Brand Highlights:

As part of its brand re-launch program, the Company increased investment in advertising to highlight its fast and reliable nationwide 4G network and its blazing fast data speeds in the U.S.

Multi-Segment Player Highlights:

In the Business-to-Business (B2B) segment, T-Mobile looks to serve as a trusted communications advisor, helping businesses develop cost-effective, high-value communications programs that meet their business objectives –through bring-your-own-device (BYOD), and mobile device management (MDM) programs as well as attractive international mobility and mobile broadband data plans. The Company continues to aggressively expand its B2B sales force.
T-Mobile launched three new Mobile Virtual Network (MVNO) partnerships during the quarter: Spot Mobile, Solavei, and UltraMobile, adding to its existing partnerships with TracFone/SIMPLE Mobile and Roam Mobility.
Challenger Business Model Highlights:

The Company continues with its efforts to drive operational efficiencies through the Reinvent program and is on track to achieve $900 million in annual gross cost savings, which the Company has started reinvesting in customer acquisition programs.
Combination with MetroPCS:

On October 3, 2012, Deutsche Telekom and MetroPCS announced their intent to combine T-Mobile and MetroPCS and create the premier "Challenger" in the U.S. wireless market and the value leader for contract and no-contract service offerings.
The complementary spectrum holdings of the two companies will enable a deeper LTE network deployment, with a clear path toward at least 20 by 20 MHz of 4G LTE in many areas of the country.
The combination will yield projected cost synergies of $6 to $7 billion.
A combined T-Mobile and MetroPCS will represent an attractive growth company with healthy projected growth rates, including a projected 7% to 10% EBITDA CAGR over the next five years.
Quarterly Financial Results:

For more detailed summary of third quarter 2012 financial results, please see the separate financial results release issued by T-Mobile today.
Forward-Looking Statements

This news release includes "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. The statements in this news release regarding the business outlook, expected performance and forward-looking guidance, as well as other statements that are not historical facts, are forward looking statements. The words "estimate," "project," "forecast," "intend," "expect," "believe," "target," "providing guidance" and similar expressions are intended to identify forward-looking statements.

Forward-looking statements are estimates and projections reflecting management's judgment based on currently available information and involve a number of risks and uncertainties that could cause actual results to differ materially from those suggested by the forward-looking statements. With respect to these forward-looking statements, management has made assumptions regarding, among other things, customer and network usage, customer growth and retention, pricing, operating costs, the timing of various events and the economic and regulatory environment.

About T-Mobile USA

Based in Bellevue, Wash., T-Mobile USA, Inc. is the U.S. wireless operation of Deutsche Telekom AG (OTCQX: DTEGY). By the end of the third quarter of 2012, approximately 131 million mobile customers were served by the mobile communication segments of the Deutsche Telekom group - 33.3 million by T-Mobile USA - all via a common technology platform based on GSM and UMTS and additionally HSPA+ 21/HSPA+ 42. T-Mobile USA's innovative wireless products and services help empower people to connect to those who matter most. Multiple independent research studies continue to rank T-Mobile USA among the highest in numerous regions throughout the U.S. in wireless customer care and call quality.

In order to provide comparability with the results of other US wireless carriers, all financial amounts are in US dollars and are based on accounting principles generally accepted in the United States ("GAAP"). T-Mobile USA results are included in the consolidated results of Deutsche Telekom, but differ from the information contained herein as, among other things, Deutsche Telekom reports financial results in Euros and in accordance with International Financial Reporting Standards (IFRS).

For more information, please visit http://www.T-Mobile.com. T-Mobile is a federally registered trademark of Deutsche Telekom AG. For further information on Deutsche Telekom, please visit www.telekom.de/investor-relations.

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