[The Exiled]

nVidia's CEO reassuring employees that layoffs aren't coming after missing revenue targets

nVidia CEO Jensen Huang reassured its 22,000-plus employees on Monday that no layoffs are imminent at the chip giant — even after the company released preliminary earnings warning Wall Street that it's likely to miss its quarterly revenue guidance by over $1 billion. In an email to employees viewed by Insider, Huang says that the Q2 results were "significantly lower than anticipated" largely thanks to a slowdown in its gaming business, but reassured employees that nVidia's fundamentals are still strong and demand remains high. "So what does this mean for us? Do we have a layoff? No. Instead, we have given raises to take care of your families as all of you are facing sky-high inflation," he wrote. It's not clear if Huang was referring to a new pay raise initiative for nVidia employees, or speaking more generally about the company's compensation practices. In the email, Huang also did not rule out the possibility of layoffs in the future.

He said that the company will instead take the opportunity to make nVidia a better, more efficient company, and that the company will hold "investments at current levels." "We will exercise extreme collaboration, a hallmark of our culture, finding every opportunity to leverage and reuse. We will find and eliminate all wasted time, process, and material," he wrote. "Take this opportunity to make nVidia even faster, leaner, and agile." In an announcement made on Monday, nVdiia said that its quarterly earnings are expected to come in at $6.7 billion, down significantly from the $8.1 billion it had previously told investors to expect. nVidia's stock sunk over 6% on Monday on the news. nVidia chalked the decrease to a decline in the firm's gaming division which saw a drop of 44%.

It also called out a slowdown in its data center business, which provides powerful server chips for businesses, but which has been impacted by the global supply chain slowdowns. That business is expected to post $3.81 billion in quarterly revenue, nVidia said in its Monday filing, which would be up only 1% from the quarter before — but 61% from the same timeframe of 2021. nVidia's pledge that layoffs aren't imminent comes as tech industry peers like Oracle and Robinhood have cut jobs as markets sour and fears of a recession loom. Others have tightened their belts in different ways, including by rescinding offers to new hires. Huang closed out his email by urging nVidia's employees to turn their energies towards doubling down on the company's investments in cutting-edge fields like the metaverse and artificial intelligence, where he says future growth will be found. "So let's turn our alertness and agility to maximum, engines full-throttle, and fly through the challenges ahead while continuing to do our impactful work," he wrote.

Izvor: Business Insider