Just when you thought things were going swimmingly in NVIDIA's (NASDAQ:NVDA) mobile chip business, it's now confirmed a whopper of a loss. Mobile head Mike Rayfield has quietly resigned from the company, which has long been leading the segment as its Tegra chips gain traction among mobile devices.
Rayfield left last month to pursue a position at another company, but it remains unclear as to whether it may be a direct competitor or not. He has been attributed with much of NVIDIA's mobile Tegra strategy over the years, scoring wins in recent times in important devices like Google's (NASDAQ:GOOGL) Nexus 7 (launched over the summer) and Microsoft's (NASDAQ:MSFT) Surface to be released later this year.
Despite rumors that it would land a cushy spot in Amazon.com's (NASDAQ:AMZN) new Kindle Fires, it actually ended up going to Texas Instruments (NASDAQ:TXN). That probably wasn't for a lack of trying, though, as Longbow Research analyst Jo Anne Feeney told The Wall Street Journal, "I got the impression they were really going for that business. I was a little surprised they didn't get it." Amazon even went the extra step in bashing the Tegra 3, showing how the TI chips it chose outperform NVIDIA's by its calculations.
On the last conference call, CEO Jen-Hsun Huang confirmed that the company is on target to meet or beat its previously issued guidance of $540 million this year for the Tegra business. That's been toned down substantially from his previous forecast of $1 billion, but Huang must have just gotten a little ahead of himself.
Last quarter was still a record quarter for Tegra, driven largely by its strength in tablet design wins. The loss of Rayfield is certainly bad news for NVIDIA, but hopefully his replacement will be just as capable.
Evan Niu has no positions in the stocks mentioned above. The Motley Fool owns shares of Amazon.com, Google, and Microsoft. Motley Fool newsletter services recommend Amazon.com, Google, Microsoft, and NVIDIA. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.