Record-breaking Anadigics coins a net profit
GaAs chip manufacturer Anadigics posted a net profit and record company revenue in the quarter that ended on June 30.
Big customers, including Intel, Samsung and LG are driving the Warren, NJ, company s resurgence, with CEO Bami Bastani remarking that Anadigics is reaping the benefits of its strong positions in what he calls the "mega-trend" growth markets of 3G cellular, broadband wireless LAN, and CATV.
Posting best-ever sales of $53.9 million in the quarter - up 37 percent year-on-year and nearly 9 percent sequentially - Anadigics also made a $1.9 million net profit based on accepted accounting principles, known as GAAP figures.
"We are very proud to have crossed into GAAP profitability," said Bastani. Not including stock compensation expenses, Anadigics net profit stood at $5.7 million for the quarter.
Detailing the company s sales mix, the CEO highlighted that demand for 3G products was one of the key factors underpinning the strong financial performance.
The Korean firms LG and Samsung, both major Anadigics customers, are winning market share with their high-end handsets and smart phones, for example. The 3G market utterly dominates Anadigics wireless product sales, accounting for the vast majority of the business segment s quarterly sales of nearly $26 million, or 48 percent of total revenue.
Another major sales driver is Intel, whose latest mobile computing chipset - codenamed Santa Rosa and sold under the Centrino Pro banner - is ramping much faster than initially expected, and which Intel has said is one of its fastest chipset ramps ever.
Intel s Santa Rosa products support the 802.11n broadband wireless LAN standard (see related stories), which offers a far better coverage, range, connection speed and battery life than previous generations of the technology. Crucially for Anadigics and its suppliers, it also requires multiple RF chains, which demands several power amplifiers and a much higher GaAs content. The broadband Wi-Fi sector, which includes WiMAX applications, accounted for 22 percent of Anadigics sales in the latest quarter.
With strong traction in the CATV sector as well (28 percent of sales), things are looking good for an even better performance in the second half of 2007 and into 2008.
Crucial to the winning formula, says Bastani, is the BiFET technology that integrates HBT and PHEMT wafer processing, and which Anadigics labels its "InGaP-plus" approach.
Having recently broken ground on its Chinese wafer fab construction, the company will be able to drive manufacturing costs down in the future too.
As well as doubling wafer capacity, Bastani says, the Kunshan fab will give Anadigics the "lowest cost-per-wafer in the industry". The fab is set to begin operations near the end of 2008 or early 2009.
