Strong results from RFMD, Vitesse remains cautious
RF Micro Devices has announced that its revenues for the quarter ended March 31, 2002 were $100.4 million, and were essentially flat compared to the $100.6 million recorded for the previous quarter. However, based on its current backlog, RFMD expects revenues of approximately $107-110 million for the quarter ending June 30, 2002, which would constitute record quarterly revenues for the company.
Furthermore, the company has decided to begin the transition to 6-inch wafer production.
Revenues for the March 2002 quarter were up 82.5% compared to the $55.0 million recorded in the March 2001 quarter. Revenues exceeded the company s prior estimate because components shipped to the handset and WLAN markets exceeded original customer forecasts. Net income for the March 2002 quarter was $2.8 million, or $0.02 per share, compared to net income of $3.5 million, or $0.02 per share, for the December 2001 quarter.
"We are very pleased to report a March quarter that exceeded our expectations and outperformed the handset market," said president and CEO David Norbury. "While industry analysts forecast handset sales in the March quarter would be down seasonally approximately 10% to 15% versus the December quarter, we were able to achieve March revenues that were essentially flat with our December results. We believe we accomplished this by gaining share in the power amplifier market and by growing revenues in emerging growth markets."
RFMD reports "favorable design activity" in the power amplifier market, particularly with the second, third, fourth and fifth leading handset manufacturers. None of these customers currently represents more than a tenth of RFMD?s quarterly revenues, but a number of them could become 10% customers in fiscal 2003. A large number of new production orders from these customers relate to next generation (2.5G) handsets, which are expected to spark replacement purchases this year. The company also estimates it has a 10% share of the wireless LAN market.
"Yields continue to improve, cycle times are decreasing and capacity utilization in our fabs has risen rapidly," said Dean Priddy, CFO and VP of administration. "Currently, our first fab is operating at nearly full capacity and production is increasing rapidly in our second fab. To increase capacity, we are selectively adding both equipment and manpower, and these additions are helping us meet surge demand in the near-term. Longer term, given the dramatic increase in wafer starts, we have decided to begin the transition to six-inch wafer production. Once complete, six-inch wafer production will give us additional capacity and further lower our cost structure."
Vitesse revenues up slightly from previous quarter
Vitesse has reported revenues of $42.1 million in the March 2002 quarter, an increase of 8% from the $39.1 million recorded in the December 2001 quarter. Revenues are down 65% compared to $121.8 million recorded in the March 2001 quarter. For the six month period ended March 31, 2002, revenues were $81.2 million, a 72% decrease over the $286.8 million for the six month period ended March 31, 2001.
Net loss for the second quarter of fiscal 2002 was $44.4 million or $0.22 loss per share. Net loss for the six month period ended March 31, 2002 was $151.3 million or $0.76 loss per share.
"In the second quarter of fiscal 2002 we saw a modest increase in revenues, primarily driven by demand in the metro market where many of our products are now moving into production," said Vitesse president and CEO, Lou Tomasetta. "While this represents our second consecutive quarter of top-line growth, we continue to remain cautious about end system demand for the remainder of calendar 2002. We have made progress in reducing costs and remain committed to continuing this effort over the next few quarters."
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