Nvidia in Arbitration with Microsoft on Chips

Graphics chip maker Nvidia Corp. is in arbitration with Microsoft Corp. over the prices of chips Nvidia makes for Microsoft's Xbox game console, and a ruling in Nvidia's favor could have a "dramatic positive impact," its chief executive said Monday.

Jen-Hsun Huang told Reuters that while the two companies have a strong relationship, they are disputing the price Microsoft pays for one of the custom processors Nvidia designed for the console.

"We're delighted we have a wonderful relationship with Microsoft and working on many fronts together, and the arbitration is just a step in an overall process in resolving this thing," Huang said.

"In the meantime we're recognizing the difference between what Microsoft is paying and the price they believe they should be paying as deferred revenues," he added.

Earlier on Monday Nvidia raised its forecast for the current quarter, its fiscal first quarter ending April 28, restated results for the past three fiscal years and announced an interim chief financial officer.

News source: Reuters