NVIDIA 2010 Annual Report Download - page 31

If sales to any of our customers outside of the United States and other Americas are delayed or cancelled because of any of the
above factors, our revenue may be negatively impacted.
Our international operations in Australia, China, Finland, France, Germany, Hong Kong, India, Japan, Korea, Russia, Singapore,
Sweden, Switzerland, Taiwan, and the United Kingdom are subject to many of the above listed risks. Difficulties with our
international operations, including finding appropriate staffing and office space, may divert management’s attention and other
resources any of which could negatively impact our operating results.
The economic conditions in our primary overseas markets, particularly in Asia, may negatively impact the demand for our
products abroad. All of our international sales to date have been denominated in United States dollars. Accordingly, an increase in the
value of the United States dollar relative to foreign currencies could make our products less competitive in international markets or
require us to assume the risk of denominating certain sales in foreign currencies. We anticipate that these factors will impact our
business to a greater degree as we further expand our international business activities.
Conditions outside the control of our independent subcontractors and manufacturers may impact their business operations
and thereby adversely interrupt our manufacturing and sales processes.
The economic, market, social, and political situations in countries where certain independent subcontractors and manufacturers
are located are unpredictable, can be volatile, and can have a significant impact on our business because we may be unable to obtain or
distribute product in a timely manner. Market and political conditions, including currency fluctuation, terrorism, political strife, war,
labor disruption, and other factors, including natural or man-made disasters, adverse changes in tax laws, tariff, import or export
quotas, power and water shortages, or interruption in air transportation, in areas where our independent subcontractors and
manufacturers are located could also have a severe negative impact on our operating capabilities. For example, because we rely
heavily on TSMC to produce a significant portion of our silicon wafers, earthquakes, typhoons or other natural disasters in Taiwan and
Asia could limit our wafer supply and thereby harm our business, financial condition, and operational results.
We are dependent on key employees and the loss of any of these employees could negatively impact our business.
Our future success and ability to compete is substantially dependent on our ability to identify, hire, train and retain highly
qualified key personnel. The market for key employees in the technology industry can be competitive. None of our key employees is
bound by an employment agreement, meaning our relationships with all of our key employees are at will. The loss of the services of
any of our other key employees without an adequate replacement or our inability to hire new employees as needed could delay our
product development efforts, harm our ability to sell our products or otherwise negatively impact our business.
In addition, we rely on stock-based awards as one means for recruiting, motivating and retaining highly skilled talent. If the
value of such stock awards does not appreciate as measured by the performance of the price of our common stock or if our
share-based compensation otherwise ceases to be viewed as a valuable benefit, our ability to attract, retain, and motivate employees
could be weakened, which could harm our results of operations.
We may not be able to realize the potential financial or strategic benefits of business acquisitions or strategic investments,
which could hurt our ability to grow our business, develop new products or sell our products.
We have acquired and invested in other businesses that offered products, services and technologies that we believe will help
expand or enhance our existing products and business. We may enter into future acquisitions of, or investments in, businesses, in order
to complement or expand our current businesses or enter into a new business market. Negotiations associated with an acquisition or
strategic investment could divert management’s attention and other company resources. Any of the following risks associated with
past or future acquisitions or investments could impair our ability to grow our business, develop new products, our ability to sell our
products, and ultimately could have a negative impact on our growth or our financial results:
• difficulty in combining the technology, products, operations or workforce of the acquired business with our business;
• difficulty in operating in a new or multiple new locations;
• disruption of our ongoing businesses or the ongoing business of the company we invest in or acquire;
• difficulty in realizing the potential financial or strategic benefits of the transaction;
• difficulty in maintaining uniform standards, controls, procedures and policies;
• disruption of or delays in ongoing research and development efforts;
• diversion of capital and other resources;
• assumption of liabilities;
• diversion of resources and unanticipated expenses resulting from litigation arising from potential or actual business
acquisitions or investments;
• difficulties in entering into new markets in which we have limited or no experience and where competitors in such markets
have stronger positions; and
• impairment of relationships with employees and customers, or the loss of any of our key employees or customers our
target’s key employees or customers, as a result of our acquisition or investment.
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Source: NVIDIA CORP, 10-K, March 18, 2010 Powered by Morningstar® Document Research℠