Nvidia Takes $119.1 M Charge for Faulty GPUs

Faulty GPUs take a bite out of Nvidia.

While the cutting latest Nvidia GPUs appear to be mostly free from manufacturing error, the faulty GPU continues to plague both the company and owners of the chip.

Disclosed in its quarterly filings, Nvidia revealed a charge that cost the company $119.1 million over the last four months to cover warranty and replacement costs related to the faulty chips due to weak packaging materials, according to Network World.

The $119.1 million charge itself brought company's bottom line down, as the company recorded a quarterly net loss of $105.3 million. This compares to a net loss of $120.9 million reported in the second quarter of 2008.

Nvidia CEO Jen-Hsun Huang called the charge just a small distraction, and that he sees signs of a recovery of the company's business.

"Nvidia's business is recovering. Product demand is improving, and our strategic investments are leading to new growth," Huang said.