For third-quarter 2013, GigOptix Inc of San Jose, CA, USA (a fabless supplier of analog semiconductor and optical communications components for fiber-optic and wireless networks) has reported revenue of $7.3m, down 28% on $10.1m a year ago but up 7% on $6.8m last quarter (above August's guidance of 5%), marking an upturn after several "slow and challenging quarters".
Growth was driven by a 14% rise in High Speed Communications business, due primarily to higher demand for the fast-growing 100Gbps coherent telecom segment. "GigOptix commands a roughly 50% share of the 100Gbps coherent optical communications device market, through our dominant position in the TIA [transimpedance amplifier] and driver product areas," says chairman & CEO Dr Avi Katz. "In addition, we saw continued interest in commercialization of our products for the datacom market, where we maintain a sole merchant provider status and leadership position in optical engines for the 40Gbps QSFP+ devices for active optical cables [AOCs] and transceivers in newly installed data-centers," he adds.
On a non-GAAP basis, gross margin was 62%, up from 54% a year ago but down from last quarter's record 65%. Net loss was $0.7m, impacted by $0.6m in R&D wafer tape-out related expenses associated with the firm's joint development programs (JDP). This compares with net income of $0.1m last quarter and $0.6m a year ago. Adjusted EBITDA has fallen from $1.3m a year ago and $0.7m last quarter to $0.1m, but this is only after the $0.6m in JDP expenses.
"On 19 September, we announced a global settlement of all pending lawsuits between GigOptix and M/A-COM Technology Solutions Inc and its affiliates, including our lawsuit for alleged misappropriation of trade secrets and breach of contract, and subsequently on 24 September received a payment of $7.25m," says Katz. Consequently, during the quarter, cash and cash equivalents rose from $9.5m to $15.3m.
"We can now focus all of our efforts on continuing to build our business through new product introductions and enhancing our strategic expansion plans as we execute on our long-term business plan," says Katz. "Combined, these efforts should lead to more revenue opportunities in the next year and expansion into new, large and promising markets," he adds.
"The third quarter was an inflection point in our business," Katz believes. "After several challenging quarters for our industry, we are more confident that revenue growth will continue over the longer-term based on the current backlog for the fourth quarter of 2013 and beyond, positive comments from our customers, and other favorable indicators in the markets we serve," he adds. "In particular, we are seeing demand rebound in the 40Gbps and 100Gbps telecom and datacom markets, where we have a strong presence with several key technologies. We are also factoring into our growth forecast the expected new product introductions in 2014 for our Industrial business and new product introductions in the consumer electronics market."
In the light of the better market conditions and improving demand, for fourth-quarter 2013 GigOptix expects revenue to grow by 5%. "Non-GAAP bottom-line performance and adjusted EBITDA should also improve as R&D expenses (which rose by $0.6m in Q3 to support new JDP product tape-outs) will decline to the quarterly levels recorded in first-half 2013.
