Regulators on three continents probing Nvidia's $40bn purchase of Arm, CFO confirms
(2021/11/18)
- Reference: 1637241306
- News link: https://www.theregister.co.uk/2021/11/18/nvidia/
- Source link:
The US is a new obstacle for Nvidia to overcome in its $40bn purchase of Arm with the Federal Trade Commission voicing unease with deal – just days after a UK competition regulator launched a [1]deeper probe into the sale.
Colette Kross, chief beancounter at Nvidia, last night confirmed the new front in the firm's 14-month effort to convince regulators that competition will not be stifled and customers will not lose out should they approve the agreement that was first announced in [2]September 2020 .
"Regulators at the US FTC have expressed concerns regarding the transaction and we are engaged in discussions with them regarding remedies to address those concerns," she said on a [3]Q3 earnings call .
[4]
Kross did not detail the specific nature of those worries or how it is trying to resolve them. She did confirm the transaction is also "under review by China Antitrust Authority, pending the formal case initiation."
[5]
[6]
Just this week, the UK's Department of Media, Culture and Sport asked the Competition and Markets Authority to [7]delve deeper into the purchase , saying the regulator received complaints from other vendors that Nvidia will restrict access to Arms CPU IP to benefit its profits and "downstream activities."
Nvidia has always denied that it will take actions to damage Arm's customers but any concessions it has made seem to be falling on deaf ears so far. Phase Two of the CMA's scrutiny will address national security as well as competition issues. The EU is also showing keen interest in the sale of Arm, itself [8]launching an investigation last month .
[9]
"Despite these concerns and those raised by some Arm licensees, we continue to believe in the merits and the benefits of the acquisition to Arm, to its licensees and to the industry," said Kross.
[10]UK watchdog launches full probe of Motorola Solutions' cop-comms deals on Emergency Services Network
[11]Apple is beginning to undo decades of Intel, x86 dominance in PC market
[12]Nvidia anoints itself a creator of the metaverse
[13]Truckload of GPUs stolen on their way out of San Francisco
[14]'We will not rest until the periodic table is exhausted' says Intel CEO on quest to keep Moore's Law alive
The CMA [15]confirmed today that the Phase Two investigation will conclude on 2 May.
Kross was on a conference call to discuss results for [16]Q3 ended 31 October of Nvidia's fiscal 2022 : revenues jumped 50 per cent to $7.1bn, with the Data Center division up 55 per cent to $2.94bn; Gaming was up 42 per cent to $3.22bn; Professional Visualization up 144 per cent to $577m; and Automotive up 8 per cent to $135m.
"Demand was strong across the board," said the CFO, but the numbers could have been bigger, as channel inventories of desktop GPUs "remain low." In the Data Centre segment, sales to hyperscale customers doubled, "fuelled by continued rapid adoption of Ampere architecture Tensor Core GPUs for both internal and external workloads."
"In networking, revenue was impacted as demand outstripped supply," she added.
[17]
Kross said Nvidia is "securing supply for next year, not just for the current year and Q4" by making upfront payments to component makers.
"We made a payment within this quarter of approximately $1.6bn out of total long-term capacity agreement of about $3.4bn. So we still have more payments to make and we will likely continue to be purchasing longer term to support our growth that we are planning for many years to come."
Huang said: "I think this whole last year was a wakeup call for everybody to be much more mindful about not taking the supply chain for granted and we were fortunate to have such good partners, but nonetheless we've secured our future."
If only dealing with regulators was as simple as, er, sorting out a global supply chain. ®
Get our [18]Tech Resources
[1] https://www.theregister.com/2021/11/16/nvidia/
[2] https://www.theregister.com/2020/09/14/nvida_arm_acquisition/
[3] https://www.fool.com/earnings/call-transcripts/2021/11/18/nvidia-corporation-nvda-q3-2021-earnings-call-tran/
[4] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_offbeat/legal&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=2&c=2YZaGw6Pwk4N-EyKmMDgz@AAAAIg&t=ct%3Dns%26unitnum%3D2%26raptor%3Dcondor%26pos%3Dtop%26test%3D0
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[7] https://www.theregister.com/2021/11/16/nvidia/
[8] https://www.theregister.com/2021/10/28/eu_nvidia_arm/
[9] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_offbeat/legal&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=4&c=44YZaGw6Pwk4N-EyKmMDgz@AAAAIg&t=ct%3Dns%26unitnum%3D4%26raptor%3Dfalcon%26pos%3Dmid%26test%3D0
[10] https://www.theregister.com/2021/10/25/cma_motorola_solutions_esn_probe/
[11] https://www.theregister.com/2021/11/12/apple_arm_m1_intel_x86_market/
[12] https://www.theregister.com/2021/11/09/nvidia_metaverse/
[13] https://www.theregister.com/2021/11/08/evga_gpu_theft/
[14] https://www.theregister.com/2021/10/28/intels_gelsinger_moore/
[15] https://www.gov.uk/cma-cases/nvidia-slash-arm-merger-inquiry
[16] https://nvidianews.nvidia.com/news/nvidia-announces-financial-results-for-third-quarter-fiscal-2022
[17] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_offbeat/legal&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=3&c=33YZaGw6Pwk4N-EyKmMDgz@AAAAIg&t=ct%3Dns%26unitnum%3D3%26raptor%3Deagle%26pos%3Dmid%26test%3D0
[18] https://whitepapers.theregister.com/
Colette Kross, chief beancounter at Nvidia, last night confirmed the new front in the firm's 14-month effort to convince regulators that competition will not be stifled and customers will not lose out should they approve the agreement that was first announced in [2]September 2020 .
"Regulators at the US FTC have expressed concerns regarding the transaction and we are engaged in discussions with them regarding remedies to address those concerns," she said on a [3]Q3 earnings call .
[4]
Kross did not detail the specific nature of those worries or how it is trying to resolve them. She did confirm the transaction is also "under review by China Antitrust Authority, pending the formal case initiation."
[5]
[6]
Just this week, the UK's Department of Media, Culture and Sport asked the Competition and Markets Authority to [7]delve deeper into the purchase , saying the regulator received complaints from other vendors that Nvidia will restrict access to Arms CPU IP to benefit its profits and "downstream activities."
Nvidia has always denied that it will take actions to damage Arm's customers but any concessions it has made seem to be falling on deaf ears so far. Phase Two of the CMA's scrutiny will address national security as well as competition issues. The EU is also showing keen interest in the sale of Arm, itself [8]launching an investigation last month .
[9]
"Despite these concerns and those raised by some Arm licensees, we continue to believe in the merits and the benefits of the acquisition to Arm, to its licensees and to the industry," said Kross.
[10]UK watchdog launches full probe of Motorola Solutions' cop-comms deals on Emergency Services Network
[11]Apple is beginning to undo decades of Intel, x86 dominance in PC market
[12]Nvidia anoints itself a creator of the metaverse
[13]Truckload of GPUs stolen on their way out of San Francisco
[14]'We will not rest until the periodic table is exhausted' says Intel CEO on quest to keep Moore's Law alive
The CMA [15]confirmed today that the Phase Two investigation will conclude on 2 May.
Kross was on a conference call to discuss results for [16]Q3 ended 31 October of Nvidia's fiscal 2022 : revenues jumped 50 per cent to $7.1bn, with the Data Center division up 55 per cent to $2.94bn; Gaming was up 42 per cent to $3.22bn; Professional Visualization up 144 per cent to $577m; and Automotive up 8 per cent to $135m.
"Demand was strong across the board," said the CFO, but the numbers could have been bigger, as channel inventories of desktop GPUs "remain low." In the Data Centre segment, sales to hyperscale customers doubled, "fuelled by continued rapid adoption of Ampere architecture Tensor Core GPUs for both internal and external workloads."
"In networking, revenue was impacted as demand outstripped supply," she added.
[17]
Kross said Nvidia is "securing supply for next year, not just for the current year and Q4" by making upfront payments to component makers.
"We made a payment within this quarter of approximately $1.6bn out of total long-term capacity agreement of about $3.4bn. So we still have more payments to make and we will likely continue to be purchasing longer term to support our growth that we are planning for many years to come."
Huang said: "I think this whole last year was a wakeup call for everybody to be much more mindful about not taking the supply chain for granted and we were fortunate to have such good partners, but nonetheless we've secured our future."
If only dealing with regulators was as simple as, er, sorting out a global supply chain. ®
Get our [18]Tech Resources
[1] https://www.theregister.com/2021/11/16/nvidia/
[2] https://www.theregister.com/2020/09/14/nvida_arm_acquisition/
[3] https://www.fool.com/earnings/call-transcripts/2021/11/18/nvidia-corporation-nvda-q3-2021-earnings-call-tran/
[4] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_offbeat/legal&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=2&c=2YZaGw6Pwk4N-EyKmMDgz@AAAAIg&t=ct%3Dns%26unitnum%3D2%26raptor%3Dcondor%26pos%3Dtop%26test%3D0
[5] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_offbeat/legal&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=4&c=44YZaGw6Pwk4N-EyKmMDgz@AAAAIg&t=ct%3Dns%26unitnum%3D4%26raptor%3Dfalcon%26pos%3Dmid%26test%3D0
[6] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_offbeat/legal&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=3&c=33YZaGw6Pwk4N-EyKmMDgz@AAAAIg&t=ct%3Dns%26unitnum%3D3%26raptor%3Deagle%26pos%3Dmid%26test%3D0
[7] https://www.theregister.com/2021/11/16/nvidia/
[8] https://www.theregister.com/2021/10/28/eu_nvidia_arm/
[9] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_offbeat/legal&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=4&c=44YZaGw6Pwk4N-EyKmMDgz@AAAAIg&t=ct%3Dns%26unitnum%3D4%26raptor%3Dfalcon%26pos%3Dmid%26test%3D0
[10] https://www.theregister.com/2021/10/25/cma_motorola_solutions_esn_probe/
[11] https://www.theregister.com/2021/11/12/apple_arm_m1_intel_x86_market/
[12] https://www.theregister.com/2021/11/09/nvidia_metaverse/
[13] https://www.theregister.com/2021/11/08/evga_gpu_theft/
[14] https://www.theregister.com/2021/10/28/intels_gelsinger_moore/
[15] https://www.gov.uk/cma-cases/nvidia-slash-arm-merger-inquiry
[16] https://nvidianews.nvidia.com/news/nvidia-announces-financial-results-for-third-quarter-fiscal-2022
[17] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_offbeat/legal&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=3&c=33YZaGw6Pwk4N-EyKmMDgz@AAAAIg&t=ct%3Dns%26unitnum%3D3%26raptor%3Deagle%26pos%3Dmid%26test%3D0
[18] https://whitepapers.theregister.com/
Re: I count two in the article.
Giles C
From the fourth paragraph
"under review by China Antitrust Authority, pending the formal case initiation."
Re: I count two in the article.
Peter Gathercole
Although it turned out to be largely aligned, the definition of the continents pre-dates the discovery of Plate Tectonics by several centuries.
Although the concept of Continental Drift was an area of interest as early as the late 19th century, the publishing of the research into Plate Tectonics happened within my lifetime, and I remember when it was the hot new topic back in the 1960's as the first major piece of new science that I took notice of.
I pestered my parents to allow me to stay up to watch the BBC's Horizon program on BBC2 on several occasions because it had documentaries about it (although they often allowed be to stay up if the programs were sufficiently educational).
This was when Horizon was one of the BBC's flagship science programs, and not the watered down science teaser it became later in it's life.
I miss those days of Horizon, The Ascent of Man, The Body in Question, Earthstory to name just a few that stick in my memory. Now, programs are always arranged for commercial television, with recaps after every advert break just to remind people what they had been watching three minutes earlier. Means that an hour slot only allows about 20 minutes of material.
The horizon is starting to get a bit crowded on this deal
Pascal Monett
So Nvidia now has Australia (IIRC), Europe, the UK, China and now the US looking into the merger.
I think some people at Nvidia must be chugging aspirin by the tub now.
I count two in the article.
UK, Europe and USA are looking into this, last time I checked while the UK have left the EU they are still part of the same continent*.
Unless you means China is the third one in which case putting that in the article would have been useful.
*Moving the UK to a new continental plate would be tricky, but doing it while keeping the island of Ireland in one piece and keeping the Republic of Ireland on the European continental shelf would make that boarder rather tectonically active.