NVIDIA has signed a definitive agreement to acquire San Jose, CA-based PortalPlayer, Inc., a leading supplier of semiconductors, firmware, and software for personal media players (PMPs) and secondary display-enabled computers. PortalPlayer, which was founded in 1999, is widely recognized for its pioneering technology, including the high-performance system-on-chip (SoC) technology which powers some of the world’s most recognizable portable digital music players. The acquisition of PortalPlayer is expected to accelerate NVIDIA’s ongoing investment in its handheld product strategy. Today, NVIDIA’s handheld technology, which combines high-quality graphics, TV, and video with low power and a small footprint, is at the foundation of many industry-leading portable media devices, including phones from Motorola, Samsung, Kyocera, HTC, and Sony Ericsson.

NVIDIA Corporation (Nasdaq: NVDA – News), the worldwide leader in
programmable graphics technologies, today announced that it has signed a
definitive agreement to acquire San Jose, CA-based PortalPlayer, Inc. (Nasdaq:
PLAY – News), a leading supplier of semiconductors, firmware, and software for
personal media players (PMPs) and secondary display-enabled computers.
PortalPlayer, which was founded in 1999, is widely recognized for its pioneering
technology, including the high-performance system-on-chip (SoC) technology which
powers some of the world’s most recognizable portable digital music players.

Under terms of the agreement, NVIDIA will pay $ 13.50 in cash for each
outstanding share of PortalPlayer common stock, which represents a total
purchase price of approximately $ 357 million, or approximately $ 161 million net
of cash on PortalPlayer’s balance sheet as of September 30, 2006. The purchase
price represents approximately a 19 percent premium to the 20-day average
closing price of PortalPlayer through Friday, November 3, 2006. This acquisition
has been approved by the Board of Directors of each company and is subject to
regulatory approvals and other customary closing conditions.

"Modern mobile devices are miniaturized yet powerful multimedia computers. At
the core of their architectures are complex Application Processors integrating
microprocessors, system logic, networking, and multimedia processors," said Jen-Hsun
Huang, president and CEO of NVIDIA. "With this acquisition, we are combining the
two essential technologies of next-generation PMPs, PDAs, portable game players,
and phones: PortalPlayer’s innovative Application Processor technology and
NVIDIA’s industry-leading GPU technology. With the products created through this
combination, we intend to drive the next digital revolution, where the mobile
device becomes our most personal computer."

"We are excited about the next chapter in our corporate history," added Richard
Sanquini, chairman of the PortalPlayer Board of Directors. "We believe the deal
is a win-win for our employees and shareholders. We have spent the past several
months extensively exploring our strategic options. We feel the advantages
offered by the NVIDIA acquisition are the most compelling, and that our
customers and employees will benefit from NVIDIA’s strong position in handheld
GPU technologies and its vast resources and global reach."

The acquisition of PortalPlayer is expected to accelerate NVIDIA’s ongoing
investment in its handheld product strategy. Today, NVIDIA’s handheld
technology, which combines high-quality graphics, TV, and video with low power
and a small footprint, is at the foundation of many industry-leading portable
media devices, including phones from Motorola, Samsung, Kyocera, HTC, and Sony
Ericsson.

Goldman, Sachs & Co., served as financial advisor to NVIDIA. Cowen and Company,
LLC served as financial advisor to PortalPlayer.

More details will be provided during NVIDIA’s quarterly conference call to be
held on Thursday, November 9, 2006 at 2:00 p.m. (Pacific time). To listen to the
conference call, please dial 706-679-0543; no password is required. The
conference call will also be Web cast live (listen-only mode) at the following
Web sites: www.nvidia.com and www.streetevents.com.

Replay of the conference call will be available via telephone by calling
800-642-1687 (or 706-645-9291), passcode 1252977, until November 16, 2006. The
Web cast will be recorded and available for replay until the Company’s
conference call to discuss its financial results for its fourth quarter fiscal
2007.