UPDATE 2-Chipmaker Nvidia's quarterly results beat expectations

Thu May 9, 2013 5:33pm EDT

By Noel Randewich

SAN FRANCISCO May 9 (Reuters) - Graphics chipmaker Nvidia posted better-than expected results for the first quarter including record gross margins, despite a slowing PC industry, sending its share higher.

With PC sales losing ground to tablets, Nvidia is betting on its graphics expertise to make high-performance processors for mobile devices.

Nvidia had a record GAAP gross margin of 54.3 percent and non-GAAP gross margin of 54.6 percent in the quarter. It said current-quarter gross margins would be about the same.

"Gross margins are moving up, we think partly due to (Nvidia's) higher exposure to workstations and servers - higher priced and higher value devices," said Stifel Nicolaus analyst Kevin Cassidy.

The Santa Clara, California, chipmaker reported first-quarter revenue rose to $954.7 million on Thursday, from $924.9 million in the year-ago quarter.

It said revenue in the current quarter would be $975 million, plus or minus 2 percent.

Analysts were expecting revenue of $941 million for the quarter ended in April and $1.0 billion for the quarter ending in July, according to Thomson Reuters I/B/E/S.

First-quarter net income was $77.9 million, or 13 cents a share, compared to $60.4 million, or 10 cents a share, in the same quarter last year. Analysts on average expected earnings per share of 10 cents.

Shares of Nvidia rose about 1 percent in extended trade after closing up 0.08 percent at $13.91.

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