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  Nvidia: Microsoft tiff tiny; new chip big
Time: 04:07 EST/09:07 GMT | News Source: CNET | Posted By: Alex Harris

Playing down accounting issues and an ongoing pricing dispute with Microsoft, Nvidia CEO Jen-Hsun Huang said an upcoming graphics chip should help propel the company to continued growth this year. Speaking on Wednesday at a chip conference here, Huang characterized the relationship with Microsoft as "very strong," adding, "We just asked a third party to help us solve some stuff."

Nvidia disclosed Monday that it was in arbitration with Microsoft over the pricing of its chips used in the Xbox, a move Nvidia said could either lead it to recognize additional revenue or force it to sell some chips at a loss--depending on how the issue is resolved. Microsoft's Xbox accounts for 15 percent to 20 percent of Nvidia's sales. Nvidia also said Monday it was restating its earnings for the past three years because of accounting issues.

In a filing with the Securities and Exchange Commission on Wednesday, Nvidia said the restatements will include accidental double booking of expenses, accounting judgments it concluded were incorrect, and other issues. However, Huang noted that the net effect of the restatements is that Nvidia's income for the three years in question was $1.3 million higher than previously reported.

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