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NVIDIA Restates, Retaliates and Loses CFO

Game chipmaker NVIDIA Corporation , of Xbox fame, Monday said that it is restating its previously reported results for the first three quarters of fiscal 2002 and for fiscal years 2001 and 2000.

The move came after a Securities and Exchange Commission (SEC) investigation and the recommendation of NVIDIA's independent Audit Committee, with assistance from the law firm of Cooley Godward LLP and forensic accountants from KPMG LLP.

"The Audit Committee conducted a complete and thorough review of all matters raised over the last three fiscal years. We believe the resulting restatement is appropriate," said NVIDIA president and CEO Jen-Hsun Huang. "In addition, we have the necessary systems and staff today to ensure the integrity of our financial reporting."

For its upcoming first quarter report of fiscal 2003, NVIDIA said it expects total revenues of approximately $570 to $580 million. The company also expects to report a net income of about $79 to $84 million, or $0.45 to $0.48 per diluted share.

In a separate issue, NVIDIA and Microsoft Corp. will go into binding arbitration concerning the prices of NVIDIA chips being used in Microsoft's Xbox game system. NVIDIA said a ruling against it could hurt it financially.

The Santa Clara, Calif.-based company also said its chief financial officer, Christine B. Hoberg is taking a leave of absence. The Board of Directors is initiating a search for a permanent CFO. In her place, NVIDIA is naming Corporate Controller Mary Dotz to the post.

"We are delighted to have someone of Mary's experience to step into the role of CFO and look forward to working with her in this new capacity. At the same time I want to wish Chris well during her hiatus. She has played an instrumental role in the Company during this exciting period of remarkable growth," Huang released in a statement.