Chip maker, Nvidia’s shares have crashed by 19%, following the announcement made by the company, disclosing an overheating problem with some of its chips for notebook computers.

Nvidia will be taking a onetime charge of $150 million to $200 million in its second financial quarter to compensate for what it says are the cost of repairs and replacement of the products with the problems.

The Santa Clara firm said it is experiencing higher-than-normal failure rates in certain models of its graphics-processing units, or GPUs, as well as its chipsets.

The makers of the so called “sexy graphics” are blaming poor materiasl used to make the chips and its poor packaging for the heating up problem of its chips. The design of notebooks is also being blamed as a contributory factor for the overheating.

The company has switched its suppliers and Jen Hsun Huang, Nvidia's charismatic CEO, said it has a responsibility to customers and will fix the problems.

According to web site 3D Professor, Nvidia is facing a serious problem competing with ATI, now a part of chip manufacturing Advanced Micro Devices (AMD). He said that the ATI products are eating into Nvidia's market share because of faster price/performance and due to good driver support. X