Factors That Can Drive Growth For Nvidia’s Tegra Products Business Going Forward
Trefis Team, 8/8/16
Nvidia’s revenues from Tegra processors business constituted only 11% of its total revenues in 2015, declining by around 3% year over year. This decrease was driven by a decline in the sales of Tegra products for OEM smartphones and tablets. The company shut-down its Icera modem operations in the second quarter of fiscal year 2016, which has further impacted its topline growth in the segment. In this analysis we look at the factors that can revamp the growth for Nvidia’s Tegra products going ahead:
- Demand for Tegra processors in the automotive segment: Nvidia has been working on building its automotive computing platform for over a decade and is in a strong position to leverage this growth. Nvidia has shipped 5-to-6 million devices for cars (with its Advanced Driver Assistance Systems) and has an additional 20-to-25 million such devices to ship in its pipeline. In addition to its infotainment cockpit business, Nvidia is working with a number of companies that are developing self-driving car technologies, using NVIDIA DRIVE PX. These include car manufacturers, Tier 1 OEMs, start-ups and research institutions. Thus, the company’s automotive platforms remain on a sharp upward trajectory and is likely to be a major growth driver of Nvidia’s Tegra business going ahead.
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