For second-quarter 2013, GigOptix Inc of San Jose, CA, USA (a fabless supplier of analog semiconductor and optical communications components enabling high-speed end-to-end information streaming over optical fiber and wireless networks) has reported revenue of $6.8m, down only slightly on $6.9m last quarter but down 29% on $9.6m a year ago.
On a non-GAAP basis, gross margin remained a record 65%, level with last quarter but up from 54% a year ago.
Excluding about $0.7m in stock-based compensation, $0.5m in special litigation-related expenses, and $0.3m in amortization of intangible assets, net income was $0.1m, down from $0.2m last quarter and $0.4m a year ago. Adjusted EBITDA has fallen from $1.2m a year ago to $0.7m (flat on last quarter).
"We achieved our second consecutive quarter of non-GAAP profitability while maintaining record non-GAAP gross margin in spite of the continued challenging conditions we faced in several of our served markets," says chairman & CEO Dr Avi Katz.
"We continued to make important progress during the second quarter with the joint development programs (JDP) we have with major tier-1 OEMs, with JDP revenue again exceeding $1m in the quarter," Katz notes. "We are on track to deliver customized reference design platforms for next-generation telecom products, customized transimpedance amplifiers (TIA) and drivers, and applications for the consumer electronics market, including key components to be used in gesture recognition devices," he adds. "These JDP contracts are important to our long-term growth as they support deployment of production parts towards the end of 2013 and the beginning of 2014."
"While market conditions have been tough for an extended period, I am increasingly optimistic that revenue in the second half of 2013 will be higher than the first half," comments Katz. "My confidence is supported by what appears to be a gradual improvement in our telecom business, primarily in the fast-growing 100 gigabit segment, where we command a roughly 50% share of the 100Gbps coherent driver market, which is being led by the introduction of our next-generation TIAs and drivers," he adds "In addition, we see continued improvement in the datacom market, where we have established a market leadership in optical engines for active optical cables (AOCs)," Katz says. "In our Industrial business, we are confident that revenue should increase later in 2013 as design wins with new products go into production."
"Now that we are seeing the beginning of a recovery in the telecom market, along with improvement in other parts of our business, our board of directors believes that this is the right time to reinstate the compensation and benefits for the company's employees to the levels they were at prior to the across-the-board reductions implemented early this year in response to the challenging times," Katz says. "We want to personally thank all of the GigOptix team for their shared sacrifice in helping support the company's cash position and to get us back to profitability in such a short period of time." During Q2, cash and cash equivalents held steady at $9.5m, after falling from $10.1m to $9.5m during Q1.
With a better outlook in its 100Gbps telecom business, continued strength in the datacom market, and a ramp of new products into both existing and new markets later this year, GigOptix expects third-quarter 2013 revenue will be up about 5% on Q2. "Based on our current expectations, we believe that revenue will continue to grow in the fourth quarter," says senior VP & chief financial officer Curt Sacks.
Litigation against M/A-Com Tech (Optomai)
"As we prepare to head to trial on 26 August in our lawsuit against defendants M/A-COM Technology Solutions Inc [of Lowell, MA, USA (which makes semiconductors, components, and subassemblies for RF, microwave and millimeter-wave applications)], its subsidiary Optomai Inc [a fabless semiconductor firm that develops ICs and modules for 40Gbps and 100Gbps fiber-optic networks] and three former GigOptix employees, we are continuing to incur expenses in support of this lawsuit," notes Katz. "This investment in the litigation is warranted by the evidence which we have obtained through the forensic and other discovery which we have conducted, as well as the process to date in the judicial system," he believes. "Most recently, this past week, the Superior Court of Santa Clara County, California, after considering the evidentiary record, denied motions filed by the defendants to stay the lawsuit, which followed a ruling last month against the defendants preserving our right to bring to trial all of our claims against the defendants," Katz adds.
See related items:
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GigOptix reports quarterly revenue up 5% to record $10.1m
GigOptix's revenue grows 5% in Q2 to record $9.6m
