Loading...
Loading...
reported its third quarter earnings on Thursday. Shares of the company are up 5 percent.
Below are some key highlights from its conference call.
• Our revenue for the third quarter was $930 million, which was down 3% from the prior quarter and slightly below our guidance.
• EPS was right on target.
• The lower revenue in Q3 was mainly due to weaker mobile business and lower revenue from our networking business.
• Our storage business, however, grew due to continued strength in both HDDs and SSD end markets.
• Despite the weaker revenue, we continued to focus on tight operational management and delivered margins and earnings that were either in line or better than expectations.
• We delivered the following non-GAAP results for Q3: gross margin of approximately 51%, operating margin of 17%, and earnings per share of $0.29.
• We also bought back $45 million worth of stock or 3.7 million shares during the quarter and paid approximately $31 million in dividends during the quarter.
• First, for our mobile and wireless business, revenue in this end market was soft and declined approximately 13% sequentially.
• Despite this short-term weakness, let me stress that we are very bullish about our mobile business.
• Recently, Verizon launched their XLTE-ready self-branded Ellipsis 8 tablet in North America.
• Also, China's leading consumer brand, Meizu, introduced its high-end flagship MX4 Pro Premium 4G LTE smartphone for China Mobile and China Unicom using our LTE modem solutions.
• The lower mobile revenue in Q3 was mainly due to the mix of our customer base, and the shift from the carrier-driven models to the open market in China, which require full turnkey support.
• In response, we are accelerating the introductions of our turnkey LTE platforms including complete board layout and software targeting the open market.
• Our turnkey solution will be ready in Q1 next year, and we expect revenues starting in Q2.
• We are also accelerating the expansion of our LTE solutions to markets outside of China and we'll subsequently bring our turnkey platforms to these markets.
• Our gross margin was above guidance and our EPS was on target.
• We reported revenues of $930 million for the third quarter, which was a decline of 3% sequentially as a result of weaker mobile sales and softer networking sales to carrier customers.
• Year-to-date in fiscal 2015, our revenues have grown by 15% compared to the same period in fiscal 2014, while our non-GAAP operating income has grown nearly 30%.
• Moreover, our year-to-date mobile and wireless revenue, our largest growth area, have grown by more than 25% compared to last year.
• Our improved efficiency will result in greater operating leverage as our growth continues.
• Moving on to details on our various end markets, our mobile and wireless business declined 13% sequentially and represented 27% of overall sales.
• Shipments of our baseband chipsets were weaker sequentially due to demand softness from our Asian customers.
• In networking, our revenue declined 7% sequentially and represented approximately 18% of total sales.
• Networking sales in Q3 were lower mainly due to weaker spending by service providers.
• In storage, our overall revenue grew 3% sequentially and represented approximately 49% of total sales.
• Q3 sales in this area were in line with our expectations, and driven by growth in both our HDD and SSD businesses.
• We also used $45 million to buy back approximately 3.7 million shares of stock during the quarter.
• We currently have about $213 million remaining in our authorized repurchase program and we will continue to be opportunistic in our buybacks going forward.
• We also paid dividends of $31 million in the quarter or equivalent to $0.06 per share.
• Net inventory at the end of the third quarter was approximately $356 million, a decrease of about $38 million from the previous quarter.
Guidance:
• We currently project revenues to be in the range of $880 million to $900 million.
• At the midpoint, this would equate to roughly a 4% sequential decline, in line with historical seasonal trends.
• We expect our storage, mobile and wireless businesses to decline slightly, while our networking business should be flat with Q3.
• We currently project non-GAAP gross margin of 50.5%.
Loading...
Loading...
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Date | ticker | name | Actual EPS | EPS Surprise | Actual Rev | Rev Surprise |
---|
Benzinga simplifies the market for smarter investing
Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.
Join Now: Free!
Already a member?Sign in