Nvidia Corp., a leading supplier of standalone graphics processing units as well as various core-logic sets, said that even though it was not the first company to adopt the 40nm process technology of Taiwan Semiconductor Manufacturing Company, it is currently the largest customer to utilize the 40nm fabrication process and reiterated that in the future the 40nm-based products will represent a large portion of the company’s revenue.

“I think the general buzz around the industry is that we are by far the largest producers of 40nm today and I think that that is, probably, consistent. We have shipped more and earlier than just about anybody, and we have not spoken a lot about our 40nm products because we have fabulous products that we are currently shipping and so we tend not to pre-announce products until the customers are really shipping themselves. We are ramping our 40nm product[s] now,” said Jen-Hsun Huang, chief executive officer and president of Nvidia Corp., during a quarterly conference call with financial analysts.

It is interesting to note that the world’s first mobile graphics processor made using 40nm process technology – ATI Mobility Radeon HD 4830/4860 (M97) – was announced by ATI, graphics business unit of Advanced Micro Devices, back in early March ’09, whereas the first 40nm graphics chip aimed at desktops – ATI Radeon HD 4770 (RV740) – was launched in late April ’09 and is currently available in retail.

Nvidia announced its first 40nm mobile graphics chips in mid-June ’09 and detailed its 40nm desktop graphics processors in early July, 2009. At present Nvidia only sells 40nm chips to original equipment manufacturers.

Mr. Huang re-emphasized his earlier claim that by the end of the year 25% of its revenue will be represented by chips manufactured using 40nm fabrication process and said that in Q3 2010 the vast majority of Nvidia’s products will be produced at 40nm node.

“By Q4, [40nm products] will represent a very large portion of our revenue. It certainly will not represent the vast majority of it. […] My expectation is that by Q3 [2010] timeframe, it will represent the vast majority of our products,” claimed Mr. Huang.

At present Nvidia does not address the market of high-end graphics cards with its 40nm chips. Instead, its new graphics processors are small and thus are less expensive to manufacture. However, thanks to DirectX 10.1 and GDDR5 support, they can not only boast with better functionality than previous-generation products, but also with higher performance in some cases.

“Our gross margins are higher on 40nm products because they are fresher products and the die sizes are lower, [so] they tend to be more cost effective for us,” added Mr. Huang.

Tags: Nvidia, 40nm, Geforce, TSMC