For second-quarter 2013, broadband wireless and wireline communications component maker Anadigics Inc of Warren, NJ, USA has reported net sales of $34.6m, up 31% on $26.4m last quarter and up 37.7% on $25.1m a year ago.
Fiscal Q2/2012 Q3/2012 Q4/2012 Q1/2013 Q2/2013 Revenue $25.1m $28.6m $30.5m $26.4m $34.6m
Growth was driven by WiFi products sales of $11.4m (up 138% on $4.8m last quarter). Cellular sales were $18.1m (up 10.9% on $16.3m last quarter), driven partly by an increase in certain legacy business. Infrastructure sales were $5.3m (down fractionally, by just 3.5%).
"This level of performance was driven by the exceptional traction we have achieved with our WiFi and Cellular products, which now power some of the most popular wireless devices in the market," says chairman & CEO Ron Michels.
"Our WiFi group has achieved exceptional growth and is positioned for continued success, broad penetration of multiple reference designs," notes Michels. "Our Cellular group has solid sales momentum with multiple design wins for ProEfficient and Penta-band solution, expanding our WCDMA market share," he adds. "Our Infrastructure group is leading the industry to support the transition to DOCSIS 3.1."
The greater-than-10% customers were Samsung, Murata and Huawei. During the quarter, Samsung selected Anadigics' WiFi and cellular solutions for its Galaxy S 4 smartphone, ProEficient-Plus solutions for its new Galaxy S 4 Mini, and WiFi front-end ICs for its new Galaxy Tab 3 family, while Huawei selected Anadigics' Pentaband power amplifier for its new CPE and hotspot devices.
Capacity utilization has risen again, from 55% in Q4/2012 and 65% last quarter to about 75% (almost double the 40% a year ago). Gross margin has improved from -7.7% a year ago and 0.7% last quarter to 5.2%, driven by WiFi's growth, despite a gross margin headwind from growth in legacy Cellular products and a small decrease in Infrastructure sales.
R&D expenses fell 13.1% sequentially to $8.6m, reflecting cost improvements previously put in place as well as more efficient development activities. Selling & administrative expenses rose slightly by 2% to $5.3m, as Anadigics fueled Wi-Fi's sales growth. Since first-quarter 2013, operating expenses as a percent of revenues have shrunk considerably from over 57% to about 40%, evidencing substantial operating leverage. "We expect this trend to continue as we grow the topline," says VP & chief technology officer Terry Gallagher.
On a non-GAAP basis, net loss has been cut from $17.9m a year ago and $14.8m a year ago to $12m. During the quarter, cash, cash equivalents and short- and long-term marketable securities fell from $50.9m to $41m.
"We effectively managed our cost structure while ramping production to meet increasing customer demand," says Gallagher. "We continue to make operational progress by increasing yields in our manufacturing processes and transitioning our product portfolio to our more efficient ILD (inter-layer dielectric) technology," he adds. "Capital investment was $2m and is helping expand our more efficient ILD capacity. Capital investment, combined with an increasing mix of ILD and production efficiencies being implemented, should result in an increase in available capacity."
Based on current improved bookings and revenue visibility, for third-quarter 2013 Anadigics expects further sales growth of 4-8%.
"As we migrate from legacy Cellular to new ILD products, we expect gross margin will improve with better incremental rates," says Gallagher. "While we anticipate higher sales volume in the third quarter, we expect that the capacity improvements will results in a lower utilization metric," he cautions.
"We anticipate continued financial improvement as we take advantage of our operating and manufacturing leverage, and increasing design-win penetration with our new, more profitable, ILD products," says Michels. "We expect solid growth into the second half of 2013," he adds.
See related items:
Anadigics' revenue falls 13.4% in Q1 to $26.4m
Anadigics' sales continue recovery, up 6.4% to $30.5m in Q4
Anadigics grows 14% in Q3, driven by wireless and CATV infrastructure
Anadigics' revenue falls 12% in Q2 to $25.1m
