NVIDIA Announces Financial Results for Fourth Quarter and Fiscal

NVIDIA Announces Financial Results for Fourth Quarter and Fiscal 2019

NVIDIA CORPORATION
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES
(In millions, except per share data)
(Unaudited)

	Three Months Ended									Twelve Months Ended
	January 27,			October 28,			January 28,			January 27,			January 28,
		2019			2018			2018			2019			2018

GAAP gross profit	$	1,207		$	1,921		$	1,801		$	7,171		$	5,822
GAAP gross margin		54.7	%		60.4	%		61.9	%		61.2	%		59.9	%
Stock-based compensation expense (A)		6			5			7			27			21
Legal settlement costs		21			14			1			35			1
Non-GAAP gross profit	$	1,234		$	1,940		$	1,809		$	7,233		$	5,844
Non-GAAP gross margin		56.0	%		61.0	%		62.1	%		61.7	%		60.2	%

GAAP operating expenses	$	913		$	863		$	728		$	3,367		$	2,612
Stock-based compensation expense (A)		(150	)		(135	)		(119	)		(530	)		(370	)
Acquisition-related and other costs		(1	)		3			(2	)		(2	)		(15	)
Legal settlement costs		(7	)		(1	)		-			(9	)		-
Non-GAAP operating expenses	$	755		$	730		$	607		$	2,826		$	2,227

GAAP income from operations	$	294		$	1,058		$	1,073		$	3,804		$	3,210
Total impact of non-GAAP adjustments to income from operations		185			152			129			603			407
Non-GAAP income from operations	$	479		$	1,210		$	1,202		$	4,407		$	3,617

GAAP other income (expense)	$	30		$	23		$	5		$	92		$	(14	)
Gains from non-affiliated investments		(1	)		(2	)		(2	)		(12	)		(2	)
Interest expense related to amortization of debt discount		-			-			-			2			3
Debt-related costs		-			-			2			-			20
Non-GAAP other income (expense)	$	29		$	21		$	5		$	82		$	7

GAAP net income	$	567		$	1,230		$	1,118		$	4,141		$	3,047
Total pre-tax impact of non-GAAP adjustments		184			150			129			593			428
Income tax impact of non-GAAP adjustments (B)		(25	)		(91	)		(33	)		(223	)		(257	)
Tax benefit from income tax reform		(230	)		(138	)		(133	)		(368	)		(133	)
Non-GAAP net income	$	496		$	1,151		$	1,081		$	4,143		$	3,085

Diluted net income per share
GAAP	$	0.92		$	1.97		$	1.78		$	6.63		$	4.82
Non-GAAP	$	0.80		$	1.84		$	1.72		$	6.64		$	4.92

Weighted average shares used in diluted net income per share computation
GAAP		619			625			628			625			632
Anti-dilution impact from note hedge		-			-			(1	)		(1	)		(5	)
Non-GAAP		619			625			627			624			627

GAAP net cash provided by operating activities	$	898		$	487		$	1,358		$	3,743		$	3,502
Purchase of property and equipment and intangible assets		(203	)		(150	)		(416	)		(600	)		(593	)
Free cash flow	$	695		$	337		$	942		$	3,143		$	2,909



(A) Stock-based compensation consists of the following:	Three Months Ended									Twelve Months Ended
	January 27,			October 28,			January 28,			January 27,			January 28,
		2019			2018			2018			2019			2018
Cost of revenue	$	6		$	5		$	7		$	27		$	21
Research and development	$	99		$	88		$	73		$	336		$	219
Sales, general and administrative	$	51		$	47		$	46		$	194		$	151

(B) Income tax impact of non-GAAP adjustments, including the recognition of excess tax benefits or deficiencies related to stock-based compensation under GAAP accounting standard (ASU 2016-09).

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