SecProbe.io

CORRESP
1
filename1.htm

    filename1.htm

      September
9, 2008

      Via
Edgar, Federal Express and Facsimile

      Jay
Webb

      U.S.
Securities and Exchange Commission

      Division
of Corporation Finance

        100 F
Street, N.E.

      Washington,
D.C. 20549

      Re:          NVIDIA
Corporation

      Comments
on Form 10-K for the year ended January 27, 2008

      Comments
on Form 10-Q for the quarter ended July 27, 2008

      File
Number 000-23985

      Dear Mr.
Webb:

      On behalf
of NVIDIA Corporation (“NVIDIA” or the “Company”) we are submitting for filing
this letter in response to comments received from the staff of the Securities
and Exchange Commission (the “Commission” and the “Staff”) by letter dated
August 27, 2008 (the “Comment Letter”) with respect to the Company’s Form 10-K
for the fiscal year ended January 27, 2008 and Form 10-Q for the quarterly
period ended July 27, 2008.

      The
numbering of the paragraphs below corresponds to the numbering of the comments
in the Comment Letter, which for the Staff’s convenience have been included in
this response letter.

      Form 10-Q for the quarterly
period ended July 27, 2008.

      Financial Statements, page
3

      Note 16. Fair Value of Cash Equivalents
and Marketable Securities, page
25

                1.

                We
      note that approximately 92% of your available for sale securities were
      measured based on level 2 inputs. Please tell us more about the inputs
      used, including how you obtain these inputs, what they represent and how
      you are able to corroborate these prices. Further, please explain to us
      and investors in future filings the nature of these particular markets and
      why they would be considered "less active markets" as you refer to them.
      For example, explain if the market is less active due to the fact that the
      related auctions are failing.

        We advise
the Staff that the fair values of our securities valued within the Level 2
hierarchy are primarily determined based on the market price of similar assets
as provided by a variety of independent industry standard data providers to our
investment custodian, Clearwater Analytics, or Clearwater.  These
independent industry standard data providers include companies such as
Bloomberg, Merrill Lynch and Lehman Brothers. The fair value measurements
provided by Clearwater may be corroborated with prices provided by the
independent industry standard data providers. When the fair value is obtained
from real-time quotes for transactions in active exchange markets involving
identical assets, we classify the instrument within a Level 1 hierarchy. When
the fair market value is obtained from quoted market prices of similar assets,
we classify the applicable instrument within the Level 2 hierarchy. This
approach is consistent with the provisions of Statement of Financial Accounting
Standards No. 157, or SFAS No. 157, Fair Value
Measurements.

        Excluding
one equity security, all of our available for sale securities classified within
Level 2 hierarchy are valued based on fair value measurements from quoted market
prices of similar assets.  As of July 27, 2008, we had one
insignificantly valued equity security that we considered to be in a less active
market due to the low trading volume of this security on the Toronto Stock
Exchange. Therefore, we classified the valuation of this security within the
Level 2 hierarchy.  NVIDIA also advises the Staff that we did not hold any
auction-rate securities as of July 27, 2008, and do not have any securities with
auctions that are failing. We believe our securities in less active markets are
insignificant as of July 27, 2008.

        NVIDIA
respectfully acknowledges the Staff comment and will expand our future
disclosures to clarify this matter. In addition, to the extent the amount
of securities involved in less active markets becomes significant, we intend to
disclose the fair value of our securities that are traded in less active
markets, along with a description of the nature of those markets, in our future
filings.

                2.

                We
      see that all of your cash equivalents and marketable securities valuations
      are classified as level 1 or level 2 because you "value those using quoted
      market prices or alternative pricing sources and models utilizing market
      observable inputs." Please respond to the
  following:

        · Please
tell us, and revise future filings to tell investors, what your alternative
pricing sources are and how you obtain and corroborate this
information.

        · Further,
please also explain how you develop the models utilizing market observable
inputs, explain the nature of these models, why you believe these values
represent the current fair value of your investments, any significant
assumptions used in the model and how you corroborate the information provided
by these models.

        · Tell
us the amount of the cash equivalents and marketable securities that are valued
based on alternative pricing sources as well as the amount based on the models
utilizing market observable inputs.

        · Please
clearly explain to us why you believe the inputs obtained through the use of
models utilizing market observable inputs represent level 2 inputs rather than
level 3 inputs.

        · Please
also revise your Critical Accounting Policies in future filings to discuss
significant assumptions and estimates made by management in determining fair
value.

        NVIDIA
respectfully advises the Staff that we believe our response to Comment 1
describes our pricing source and how we obtain and corroborate this
information.  NVIDIA acknowledges the Staff’s comment and submits that
our reference to “alternative
pricing sources and models utilizing market observable inputs” in our
disclosure of cash equivalents and marketable securities was intended to broadly
cover the types of pricing information that may be used. Consistent with our
response in Comment 1, we commit to revising our future disclosures to more
clearly state the nature of valuations that are classified as Level 2
hierarchy.  Additionally, NVIDIA advises the Staff that the amount of
cash equivalents and marketable securities valued based on quoted market prices
of similar assets is $1.36 billion, as disclosed within the Level 2 valuation
column in Note 16, Fair Value
of Cash Equivalents and Marketable Securities, on page 25 of the Form
10-Q for the quarterly period ended July 27, 2008.

        NVIDIA
respectfully acknowledges the Staff comment regarding Critical Accounting
Policies. We will revise our Critical Accounting Policies in our future filings
to discuss significant assumptions and estimates, if any, made by management in
determining fair value.

      Management's Discussion and
Analysis of Financial Condition and Results of Operations, page
26

      Liquidity and Capital
Resources, Page 34

      Liquidity, page
35

                3.

                We
      note that you hold approximately $1.66 billion and $1.81 billion in cash,
      cash equivalents and marketable securities at July 27, 2008 and January
      27, 2008, respectively. Further, we noted that $892.6
      million of your portfolio had a maturity of less than a year and a
      substantial majority of your remaining investments have remaining
      maturities of three years or
less.

      · Please
clarify for us the amount of your investments that you have classified as short
term and as long-term as of July 27, 2008.

      · We
see your disclosure that recent U.S. sub-prime mortgage defaults have had a
significant impact across various sectors of the financial markets causing
credit and liquidity issues and the short term funding markets experienced
issues during the third and fourth quarter of calendar 2007. We also noted your
related disclosure that if the market continues to deteriorate your investment
portfolio may be impacted and you could determine some of your investments are
impaired. Please explain the current impact of the referenced market conditions
on your investment portfolio and how you determined that that you did not have
any other than temporary impairments on your portfolio of available for sale
investments as of July 27, 2008.

      · Please
also clarify whether you have the intent and the ability to hold these
securities until maturity, if necessary. Refer to SFAS 115, SAB Topic 5M, or
other authoritative accounting literature which supports your
analysis.

      NVIDIA
advises the Staff that the balance of our cash and cash equivalents was
$719.1 million and the balance of our marketable securities was $938.1 million
as of July 27, 2008.  All of our cash equivalents and marketable
securities are treated as “available-for-sale” under Statement of Financial
Accounting Standards No. 115, or SFAS No. 115, Accounting for Certain Investments
in Debt and Equity Securities, and, as a result, are classified as
short-term.

      We advise
the Staff that we performed an impairment review of our investment portfolio for
the quarterly period ended July 27, 2008, in accordance with our accounting
policy as disclosed in Note 1, Organization and Summary of
Significant Accounting Policies, Marketable Securities, on
page 70 of our Form 10-K for the year ended January 27, 2008.  As of
July 27, 2008, the net unrealized loss on marketable securities was $0.5
million. That $0.5 million was comprised of gross unrealized losses of $3.5
million, offset by $3.0 million of unrealized gains as of July 27,
2008.

      We
believe our portfolio has not been significantly impacted by the current credit
and liquidity issues in the financial markets. As of July 27, 2008, and as of
the date of this letter, all of our investments are rated as A/A1 or better
securities, with the substantial majority of the securities rated AA-/Aa3 or
better. Additionally, the net unrealized loss is only 0.2% of our aggregate
investment portfolio. Currently, we have the intent and ability to hold our
investments with impairment indicators until maturity.  Based on our
quarterly impairment review and having considered the guidance in Statement of
Financial Accounting Standards Staff Position No. 115-1, or FSP No. 115-1, A Guide to the Implementation of
Statement 115 on Accounting for Certain Investments in Debt and Equity
Securities, we concluded that our investments were appropriately valued
and that no significant other than temporary impairment charges
were necessary on our portfolio of available for sale investments for the quarter ended
July 27, 2008.

      As stated
in our accounting policy in Note 1, Organization and Summary of
Significant Accounting Policies, Marketable Securities, on
page 70 of the Form 10-K for the year ended January 27, 2008, when necessary, we
consider general market conditions, the duration and extent to which fair value
is below cost, and our intent and ability to hold an investment for a sufficient
period of time to allow for recovery in value.  We also consider
specific adverse conditions related to the financial health of and business
outlook for an investee, including industry and sector performance, changes in
technology, operational and financing cash flow factors, and changes in an
investee’s credit rating. Investments that we identify as having an indicator of
impairment are subject to further analysis to determine if the investment was
other than temporarily impaired.

      As noted
in our response to Comment 1, we also advise the Staff that we did not hold any
auction-rate securities as of January 27, 2008 or July 27, 2008, nor do we
currently hold any such securities.

      Exhibit
31

                4.

                We
      note that the identification of the certifying individual at the beginning
      of the certification required by Exchange Act Rule 13a-14(a) also includes
      the title of the certifying individual. In future filings, the
      identification of the certifying individual at the beginning of the
      certification should be revised so as not to include the individual's
      title.

      NVIDIA
respectfully acknowledges the Staff comment and in our future filings we will
remove the title of the certifying individuals at the beginning of the
certifications required by Rule 13a-15(e) and 15d-15(e) under the Securities
Exchange Act of 1934. We will apply this practice in our future filings,
beginning with our Form 10-Q to be filed for the quarterly period ending October
26, 2008.

      In
connection with responding to the Staff’s comments, NVIDIA acknowledges
that:

                ·

                The
      Company is responsible for the adequacy and accuracy of the disclosure in
      its filings;

                ·

                Staff
      comments or changes to disclosure in response to Staff comments do not
      foreclose the Commission from taking any action with respect to the
      filing; and

                ·

                The
      Company may not assert Staff comments as a defense in any proceeding
      initiated by the Commission or any person under the federal securities
      laws of the United States.

      Please
call me at (408) 486-2000 regarding any questions or comments on this
matter.

      Sincerely,

      /s/ Marvin D.
Burkett

      Marvin D.
Burkett

      Chief
Financial
Officer

      cc:           Jen-Hsun
Huang

      Raman
Chitkara (PricewaterhouseCoopers LLP)

                  Eric C. Jensen (Cooley
Godward Kronish LLP)