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Components | January 31, 2012

Mindspeed with net revenues of USD 33.9 million

Mindspeed expects to close Picochip acquisition in February 2012 and anticipates revenue growth for fiscal 2Q/2012.
Mindspeed Technologies reported total net revenues for the fiscal first quarter of 2012 (ended on December 30, 2011) were $33.9 million. Excluding patent sales of $0.09 million, product revenue was $33.8 million, a sequential decline of 17 percent from product revenue of $40.8 million in the prior fiscal quarter and a decrease of 11 percent from product revenue of $38.0 million in the fiscal first quarter of 2011.

Product revenue from communications convergence processing solutions contributed 44 percent of fiscal first quarter of 2012 product revenues and decreased 27 percent sequentially from the prior fiscal quarter. Product revenue from high-performance analog products represented 43 percent of fiscal first quarter of 2012 product revenue and decreased 2 percent sequentially from the prior fiscal quarter. Wide area networking communications product revenue contributed the remaining 13 percent of fiscal first quarter of 2012 product revenue and decreased 19 percent sequentially from the prior fiscal quarter.

Non-GAAP gross margin for the fiscal first quarter of 2012 was $19.7 million, or 58.0 percent, compared to non-GAAP gross margin of $25.1 million, or 61.5 percent, in the prior fiscal quarter. Presented on a GAAP basis, gross margin for the fiscal first quarter of 2012 was $19.7 million, or 58.1 percent, compared to $25.0 million, or 61.3 percent, in the prior fiscal quarter.

Non-GAAP operating expenses for the fiscal first quarter of 2012 were $22.0 million, a sequential decrease of 10 percent, or $2.5 million, compared to non-GAAP operating expenses of $24.5 million in the prior fiscal quarter. GAAP operating expenses for the fiscal first quarter of 2012 were $25.1 million, a sequential decrease of 9 percent, or $2.4 million, compared to $27.5 million in the prior fiscal quarter.

Non-GAAP operating loss for the fiscal first quarter of 2012 was $2.3 million, compared to non-GAAP operating income of $0.6 million in the prior fiscal quarter. On a GAAP basis, operating loss for the fiscal first quarter of 2012 was $5.4 million, compared to operating loss of $2.5 million in the prior fiscal quarter.

Non-GAAP net loss for the fiscal first quarter of 2012 was $2.4 million, or $(0.07) per share, compared to non-GAAP net income of $1.0 million, or $0.03 per share, in the prior fiscal quarter. Presented on a GAAP basis, net loss was $5.6 million, or $(0.17) per share, compared to net loss of $2.2 million, or $(0.07) per share, in the prior fiscal quarter.

Non-GAAP results exclude stock-based compensation and related payroll costs, acquisition related costs, employee separation costs and special charges, among other items. Reconciliations of the non-GAAP measures to GAAP measures are included in the accompanying financial data.

Cash and cash equivalents were $42.8 million at the end of the fiscal first quarter of 2012, a decrease of approximately $2.4 million, compared to $45.2 million at the end of the prior fiscal quarter.

“Based on continued positive trends in channel inventory and distributor point of sales data, as well as current backlog, our perspective is that the demand environment is troughing and that we will see a stabilization in our core business in the fiscal second quarter as well as improving gross margins,” said Raouf Y. Halim, Mindspeed’s chief executive officer. “We also expect to close the Picochip acquisition in February 2012, a pivotal transaction that firmly positions us as the leader for semiconductor and software solutions in the high-growth small cell base station market.”

Outlook

Mindspeed expects fiscal second quarter of 2012 total net revenue to be within a range of $33.5 million to $35.5 million. The company expects fiscal second quarter of 2012 non-GAAP gross margin to be within a range of 58.0 to 60.0 percent.

The company also expects non-GAAP operating expenses to be within a range of $25.5 million to $26.5 million in the fiscal second quarter of 2012, assuming a February 2012 close of the Picochip acquisition without the benefit of material operating expense synergies that are expected to be realized in the third fiscal quarter of 2012.

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