Record Year For Finisar Ends With "rocky" Quarter
Finisar posted record revenues of $419.2 million in the year ended April 30, 15.1 percent higher than the previous year's figure.
The Californian optoelectronics manufacturer has also concluded its investigation into stock option practices, finding that no evidence of wrong-doing, although subsequent efforts to update accounts prevented the company from reporting profit figures.
Gross margin dipped slightly, to approximately 39 percent.
Quarterly revenue was down 9.5 percent on the previous three months to $97.3 million, which the company mainly attributed to a transition to “just-in-time" inventory systems at two of its customers.
The relocation of Finisar's VCSEL fab across Texas, from Richardson to Allen (see related stories), also had a detrimental effect on sales as customers used up inventory reserves they had built up to protect themselves against supply risks posed by this move.
The costs of the share option audit, as well as the ongoing legal costs of a patent dispute, added to the company's recent weakened financial performance, but it seems that the worst of all of these problems is now over.
Finisar's CEO, Jerry Rawls put a positive spin on events:
“We've had some rocky waters that we've had to go through in the last quarter, but we're coming out of it, " he said.
“We have some confidence that this is going to be a growth quarter and have optimistic forecasts for the rest of the year. "
A qualified success
Any loss of production capacity arising from the movement of the VCSEL fab has been all but overcome, according to Rawls.
“At our new fab in Allen, the first MOCVD reactor has now been fully qualified internally and by all customers for 8Gb and 10Gb applications."
“We are now in the process of qualifying the second reactor, which was moved in May, and we expect to have two reactors qualified and operational by the end of this year, although we only need one to keep up with current demand."
Rawls is also "very optimistic about the prospects for growth within the 10Gb sector next year."
Finisar's 10 Gb/s XFP transceivers have enjoyed a sales boom of 123 percent over the past year, contributing to a strong overall performance in the telecoms business unit.
In the last year Finisar has also completed the acquisition of two companies, Kodeos and Azna, helping to strengthen its portfolio of high speed, long-distance networking technologies.