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Will The Tegra Processor Pay Off?
Last year Nvidia’s Tegra gamble seemed to be paying off nicely, but the insanely competitive SoC market moves fast and all it takes for things to go badly wrong is one botched generation. The Tegra 4 was late to the party and Nvidia eventually ended up with a big and relatively powerful chip that nobody wanted.
In its latest earnings call Nvidia made it clear that revenues from Tegra are expected to decline $200 to $300 million this year from about $750 million last year. Even this seems like a relatively optimistic forecast. Tegra 3 ended up in quite a few high-volume products, such as the Nexus 7, HTC One X, LG Optimus X4 and a bunch of other phones and tablets. On paper, Tegra 4 will end up with a similar number of design wins, maybe even more, but nearly all of them are low-volume products.
At the moment there are only a handful of Tegra 4 products out there. These include HP’s Slatebook 10, Toshiba eXcite Pro and eXcite Write tablets and Nvidia’s own Shield console. Nvidia’s 7-inch Tegra Tab is also on the way, along with the Surface RT 2. Some Chinese vendors like ZTE are also expected to roll out a Tegra 4 phone here and there, but the chip won’t end up in any big brand phones.
Nvidia does not release any Tegra unit shipment info, so we can only guess how many Tegra 3 and Tegra 4 chips are out there, but it doesn’t take much to realise Tegra 4 is a flop. Shipments of the original Nexus 7, powered by the Tegra 3, are estimated just north of six million units. Surface RT shipments were abysmal. Earlier this year analysts put the figure at just 900,000 units after a full quarter of sales. Microsoft eventually took a massive write-down on its Surface RT stock. LG and HTC didn’t reveal any shipment figures for the Optimus 4X and HTC One X, either. HTC shipped about 40 million phones last year, while LG managed about 27 million. We can’t even begin to estimate how many of them were flagship products powered by Tegra, but the number was clearly in the millions.
This time around Nvidia can’t count on strong smartphone sales, let alone the Nexus 7 and Surface RT. Even if it scores high-end tablet design wins, the truth is that high-end Android tablets just aren’t selling well. Nvidia needed high-volume design wins and Android tablets just won’t do the trick. Qualcomm is in the new Nexus 7 and the HTC One. Back in May analysts reported that HTC One sales hit the 5 million mark in the first two months of sales, although shipments have slowed down since then. Millions of Snapdragons found a home in the HTC One and millions more will end up in the new Nexus 7.
Nvidia’s talk of a $200 to $300 million hit this year doesn’t exactly paint the full picture. Tegra 3 shipments in the first two quarters of 2013 were modest, but relatively good. However, nothing took its place and the true extent of the Tegra 4 flop will only become visible in the first quarter of 2014 and beyond. The big hope is that the Tegra 4i and Tegra 5 will start to come online by then, so the numbers for the full year won’t be as terrible, but it is abundantly clear that Nvidia cannot afford another Tegra 4.
As for Nvidia’s Tegra Tab and Shield, they might do well. Nvidia knows a thing or two about hardware, but even if they prove successful, they just won’t be enough, at least not in this cycle.
nVidia Explains Tegra 4 Delays
nVidia’s CEO Jen-Hsun Huang mentioned a concrete reason of Tegra 4 delays during the company’s latest earnings call.
The chip was announced back in January, but Jensen told the investors that Tegra 4 was delayed because of Nvidia’s decision to pull in Grey aka Tegra 4i in for six months. Pulling Tegra 4i in and having it scheduled for Q4 2013 was, claims Jensen, the reason for the three-month delay in Tegra 4 production. On the other hand, we heard that early versions of Tegra 4 were simply getting too hot and frankly we don’t see why Nvidia would delay its flagship SoC for tactical reasons.
Engaging the LTE market as soon as possible has been the main reason for pulling Tegra 4i, claims Jensen. It looks to us that Tegra 4 will be more than three months delayed but we have been promised to see Tegra 4 based devices in Q2 2013, or by the end of June 2013.
Nvidia claims Tegra 4i has many design wins and it should be a very popular chip. Nvidia expects to have partners announcing their devices based on this new LTE based chip in early 2014. Some of them might showcase some devices as early as January, but we would be surprised if we don’t see Tegra 4i devices at the Mobile World Congress next year, that kicks off on February 24th 2014.
Jensen described Tegra 4i as an incredibly well positioned product, saying that “it brings a level of capabilities and features of performance that that segment has just never seen”. The latter half of 2013 will definitely be interesting for Nvidia’s Tegra division and we are looking forward to see the first designs based on this new chip.
nVidia Wins With Tegra 4
Nvidia’s first Tegra 4 design win is here, apparently, and it doesn’t appear very impressive at all. Tegra 4 is late to the party, so it is a bit short on design wins, to put it mildly.
Now a new ZTE smartphone has been spotted by Chinese bloggers and it seems to be based on Nvidia’s first A15 chip. The ZTE 988 is a phablet, with a 5.7-inch 720p screen. It has 2GB of RAM, a 13-megapixel camera and a 6.9mm thin body. It weighs just 110g, which is pretty surprising. The spec is rather underwhelming, especially in the display department.
However, a grain of salt is advised. It is still unclear whether the phone features a Tegra 4 or a Qualcomm chipset. Also, it is rather baffling to see a 720p screen on a Tegra 4 phablet, it just seems like overkill.
Will Tegra 4 Help nVidia’s Financials?
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Trefis analysts believe Nvidia’s Tegra business is likely to grow over the next few years, although Nvidia won’t become a mobile chip company anytime soon.
In a note published a couple of days ago, Trefis concluded that Nvidia has managed to offset the impact of the PC slump thanks to mobile revenue. The PC market took a massive hit in 2012, and although things are looking up, Tegra could still come in handy.
Nvidia currently earns about 18 percent of its revenue from Tegra processors, which is not bad for a product that was on the drawing board just a few years ago.
“We estimate Tegra sales to grow at a CAGR of 17% until 2016. While we believe that Nvidia will manage to expand its footprint in mobile computing, we think that the increasing competition will keep its growth rate lower than the industry average,” said Trefis.
However, Trefis went on to conclude that Nvidia had more lack with tablets than smartphones. Last year it scored several big tablet design wins, but relatively few phone wins. The Tegra 4i, with integrated LTE, should lend a helping hand, but it won’t be ready for much of 2013. In addition, Nvidia is facing more pressure from Qualcomm and Samsung, while at the same time it was forced to push back the introduction of Tegra 4 due to technical issues.
Trefis believes Tegra’s contribution to Nvidia’s overall revenue could reach over 25 percent by 2019, which means the Tegra business won’t expand much in a mature smartphone market.
Nvidia has Tegra, AMD has consoles, so both outfits have something to fall back on in a slow PC market, at least for the time being.
Will Tegra 4 Launch In Q2?
Tegra 4 was supposed to be production ready in Q4 2012 and the general expectation was that CES 2013 would be marked by the launch of phones and tablets based on the new chipset.
It turns out that the chip needed another re-spin, something that usually creates a delay of roughly a quarter. We don’t know which part of the chip was to blame but our sources claim that Tegra 4 is a complex chip with a lot of components where many things can go wrong.
Nvidia dared to move to 28nm, change the core from A9 to A15 and find a way to make its LTE work. There were a lot of things that could go wrong and obviously some did.
This is why Intel first shrinks the core, for example from 32nm to 22nm, and then in its “tock” cycle goes for a newly designed core. Nvidia doesn’t have that luxury, as making a 28nm version of Tegra 3 would not be enough for the SoC market in 2013.
A few people at Nvidia have been telling us that the chip has been sampled to accounts and Nvidia is planning to have some designs announced at the Mobile World Congress. We managed to confirm this schedule with some Nvidia partners.
Will Tegra 4 Support USB 3.0?
Wayne, also known as Tegra 4 is coming out at CES 2013, or in some 10 days from now. Nvidia has an event planned days ahead of CES 2013 and the company will likely show some tablets and hybrids based on the new Tegra SoC. Let’s call Wayne Tegra 4 before it gets official.
Nvidia had Wayne ready to launch in Q4 2012 but it had to wait for partners to release the designs based on it, and most of them wanted to do it at CES 2013. European phones based on Wayne are going to show up in February, at the Mobile World Congress.
This is the first quad-core A15 design that will bring a significant performance increase over Tegra 3 and we are hearing that the four-plus-one core will deliver a bigger performance boost than Tegra 3 did over Tegra 2. Also, the fact that the new chip is 28nm and supports DDR3L also promises more efficiency.
USB 3.0 support is something that is getting us excited as usually it is quite slow to transfer anything onto tablets, phones and hybrids. USB 3.0 on tablets will significantly increase the data transfer speed and Tegra 4 will be among the first chips to feature USB 3.0 support, and many consumers will appreciate faster data transfer rates.
The other thing that got our attention is dual display support and you will be able to have two independent screens. On Tegra 3 based devices, you can only mirror the output, not display two independent screens. It could be a very interesting feature for dockable devices.
nVidia’s Tegra 4 Specs Spotted
Here is an interesting leak, just what the doctor ordered to spice up a rather slow news cycle. Chiphell has posted a slide containing a few Tegra 4 specs, but we still don’t know the clocks or a few other interesting details. Of course, the leak should be taken with a grain of salt, but the specs are more or less in line with what we were expecting all along.
Tegra 4, codenamed Wayne, is a 28nm part with revamped graphics and new ARM cores. Although the slide does not directly point to the type of ARM cores used in the design, the new chip is based on ARM’s latest A15 core. Like the Tegra 3, the new chip will also feature an additional companion core to improve energy efficiency. No surprises here really.
In terms of GPU performance, Nvidia promises to deliver a six-fold improvement over the Tegra 3 and a 20x improvement over Tegra 2 chips. Oddly enough, in spite of Nvidia’s graphics prowess, Tegra chips never featured world-beating graphics. This time around they could, thanks to the new 72-core GPU. The GPU will be able to cope with 2560×1600 screens at 120Hz, but it could also take on 4K resolutions, although details are still sketchy. At this point 4K support could only be relevant for next-generation smart TVs, with a huge price tag.
As far as other features go, Tegra 4 brings support for USB 3.0 and DDR3L dual-channel memory. The leak does not mention LTE support.
Tegra 4 will have to take on the likes of Samsung’s upcoming Exynos 5440, which should also debut in early 2013. Nvidia was first to market with a quad-core A9 chip, but this time around it will have to face off against the new Exynos and A15 quad-cores from other vendors.
Nvidia is expected to showcase the new chip at CES and we’ll be there to check it out.