NVIDIA Corporation Conducting Review of Certain Transactions at the Request of the SEC
For further information, contact:
Vice President Investor Relations
Tel: (408) 486-2511
Mary Ann Allencourt
Tel : (408) 486-2019
SANTA CLARA, CA – FEBRUARY 14, 2002 – NVIDIA® Corporation (Nasdaq: NVDA) today announced that, in response to an inquiry from the Securities and Exchange Commission (SEC), it is conducting an internal review of the recording of certain reserves and the timing of recording certain expenses relating to the fourth quarter of fiscal 2000, and the first three quarters of fiscal 2001. Fiscal 2000 ended on January 30, 2000 and fiscal 2001 ended on January 28, 2001.
In connection with the SEC’s previously announced investigation of alleged insider trading by certain non-executive employees, NVIDIA provided emails and other materials to the SEC for the period from December 1999 to March 2000. Based on its review of these materials, the SEC informed NVIDIA in January 2002 of specific questions relating to 1) the recording of reserves in the fourth quarter of fiscal 2000 and the first quarter of fiscal 2001; and 2) the possibility that certain product costs of up to $3.6 million should have been recorded in the first quarter of fiscal 2001, but were recorded in the second and third quarters in that same year. NVIDIA is cooperating fully with the SEC, and in accordance with their suggestion and advice, has launched an independent review of these transactions. The review will also include other periods. The Audit Committee of the NVIDIA Board of Directors is directing this independent review, with assistance from the law firm of Cooley Godward and the audit firm of KPMG. NVIDIA believes that the SEC, together with the U.S. Attorney’s Office, has authorized an investigation and interviewed at least one former NVIDIA employee.
NVIDIA is committed to fully and fairly reporting its financial performance. Upon completion of the review, NVIDIA intends to take all required and appropriate actions.
NVIDIA Corporation (Nasdaq: NVDA), based in Santa Clara, CA., is the global leader in advanced graphics and multimedia processing technology for the consumer and professional computing markets. Its 2D, 3D, video and multimedia capabilities make NVIDIA one of the premier semiconductor companies in the world. NVIDIA offers a wide range of products and services, delivering superior performance and crisp visual quality for PC-based applications such as manufacturing, science, e-business, entertainment and education. For more information, please visit the company's Web site at http://www.nvidia.com.
Certain statements in this press release, including statements relating to the scope, direction and possible conclusions of the Company’s review and related concerns and activities by government agencies, are forward-looking statements that are subject to risks and uncertainties that could cause results to be materially different than expectations. Such risks and uncertainties include governmental policies concerning the confidentiality of investigations; the early stage of the review and the limited information available and analysis conducted to date concerning the scope and nature of the activities under review or similar activities by the Company; the unknown impact of the review and any necessary corrective action on previously announced financial results of the Company; unknown future actions by governmental agencies with respect to the Company or its employees, and the impact of the review and any corrective action or other consequences on the Company’s business, relationships with customers and future financial results. Investors are advised to read the Company’s Annual Report on Form 10-K and quarterly reports on Form 10-Q filed with the Securities and Exchange Commission, particularly those sections entitled “ Business Risks,” for a full discussion of risks and uncertainties that may affect NVIDIA.
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