Feb. 14, 2002 – Santa Clara, CA – Graphics semiconductor company NVIDIA Corp. is conducting an internal review of the recording of certain reserves and the timing of recording certain expenses relating to the 4Q00 and the first three quarters of FY01 in response to an inquiry by the Securities and Exchange Commission (SEC).
In addition, NVIDIA believes that the SEC, together with the US Attorney’s Office, has authorized an investigation and has interviewed at least one former NVIDIA employee.
In connection with the SEC’s previously announced investigation of alleged insider trading by certain non-executive employees, NVIDIA provided emails and other materials to the commission for the period from December 1999 to March 2000. Based on its review of these materials, the SEC informed NVIDIA in January 2002 of specific questions relating to the recording of reserves in the 4Q00 and 1Q01; and the possibility that certain product costs of up to $3.6 million should have been recorded in the 1Q01, but were recorded in the second and third quarters in that same year.
In accordance with the SEC’s suggestion and advice, NVIDIA has launched an independent review of these transactions. The review will also include other periods. The Audit Committee of the NVIDIA board of directors is directing this independent review, with assistance from the law firm of Cooley Godward and the audit firm of KPMG.