News Article
RFMD quarterly revenues shoot up 48 percent
The company expects continued margin expansion, operating leverage and EPS growth
RF Micro Devices, Inc. has reported financial results for the company's fiscal 2014 second quarter, ended September 28th, 2013.
September quarterly revenue increased approximately 6% sequentially and 48% year-over-year to a record $310.7 million, compared to $293.0 million in the prior quarter and $209.7 million in the corresponding quarter of the prior year.
The sequential and year-over-year increases in revenue were due primarily to generation increases of RFMD's RF solutions in the industry's marquee smartphones.
On a GAAP basis, gross margin for the September 2013 quarter was 33.7%, quarterly operating income was $9.5 million, and quarterly net income was $5.9 million, or $0.02 per share.
During the September quarter, the company repurchased 2.4 million shares of stock at an average price of $5.03.
Year-over-year, RFMD's Multi-Market Products Group (MPG) delivered 12% growth across multiple markets, with high-performance Wi-Fi growing 49% and broadband cable TV and Hi-Rel applications both growing over 20%
MPG experienced strong design activity for its Wi-Fi front ends for both mobile devices and consumer premises equipment.
Business Commentary and Financial Outlook
RFMD says its markets continue to grow with the expanding demand for high-performance, broadband connectivity. This is increasing the firm's dollar content opportunities and enabling RFMD to expand its dollar content generation-over-generation in the highest tier smartphones as well as in the highest volume entry-level phones and reference designs.
The firm currently believes that demand environment in its end markets, will see the December 2013 quarter see a sequential revenue growth in CPG but be partially offset by a sequential decline in MPG.
The company also expects quarterly revenue to be approximately flat to up 5% sequentially.
RFMD's actual quarterly results may differ from these expectations and projections, and such differences may be material.
Comments From Management
Bob Bruggeworth, president and CEO of RFMD, said, "During the September quarter, RFMD continued to leverage our product and technology leadership to help differentiate our customers' products and satisfy the accelerating demand for always-on broadband connectivity. In the December quarter, RFMD anticipates another quarter of significantly improved financial performance, given our expectations for continued dollar content growth, expansion into new categories, and the benefit of ongoing new product ramps."
He continued, "We are increasing our participation on the industry's most critical reference designs and highest volume devices, across all tiers, and we are executing on multiple opportunities to further expand our dollar content next year."
Dean Priddy, CFO and vice president of administration of RFMD, added, "RFMD is delivering diversified revenue growth and executing on our margin expansion initiatives. In the current quarter, we expect to achieve approximately 120 basis points of gross margin expansion. Beyond December, our confidence in margin expansion allows us to project margin improvement in a seasonally down March quarter. In calendar 2014, we currently expect to achieve our quarterly non-GAAP gross margin model of 40%."
September quarterly revenue increased approximately 6% sequentially and 48% year-over-year to a record $310.7 million, compared to $293.0 million in the prior quarter and $209.7 million in the corresponding quarter of the prior year.
The sequential and year-over-year increases in revenue were due primarily to generation increases of RFMD's RF solutions in the industry's marquee smartphones.
On a GAAP basis, gross margin for the September 2013 quarter was 33.7%, quarterly operating income was $9.5 million, and quarterly net income was $5.9 million, or $0.02 per share.
During the September quarter, the company repurchased 2.4 million shares of stock at an average price of $5.03.
Year-over-year, RFMD's Multi-Market Products Group (MPG) delivered 12% growth across multiple markets, with high-performance Wi-Fi growing 49% and broadband cable TV and Hi-Rel applications both growing over 20%
MPG experienced strong design activity for its Wi-Fi front ends for both mobile devices and consumer premises equipment.
Business Commentary and Financial Outlook
RFMD says its markets continue to grow with the expanding demand for high-performance, broadband connectivity. This is increasing the firm's dollar content opportunities and enabling RFMD to expand its dollar content generation-over-generation in the highest tier smartphones as well as in the highest volume entry-level phones and reference designs.
The firm currently believes that demand environment in its end markets, will see the December 2013 quarter see a sequential revenue growth in CPG but be partially offset by a sequential decline in MPG.
The company also expects quarterly revenue to be approximately flat to up 5% sequentially.
RFMD's actual quarterly results may differ from these expectations and projections, and such differences may be material.
Comments From Management
Bob Bruggeworth, president and CEO of RFMD, said, "During the September quarter, RFMD continued to leverage our product and technology leadership to help differentiate our customers' products and satisfy the accelerating demand for always-on broadband connectivity. In the December quarter, RFMD anticipates another quarter of significantly improved financial performance, given our expectations for continued dollar content growth, expansion into new categories, and the benefit of ongoing new product ramps."
He continued, "We are increasing our participation on the industry's most critical reference designs and highest volume devices, across all tiers, and we are executing on multiple opportunities to further expand our dollar content next year."
Dean Priddy, CFO and vice president of administration of RFMD, added, "RFMD is delivering diversified revenue growth and executing on our margin expansion initiatives. In the current quarter, we expect to achieve approximately 120 basis points of gross margin expansion. Beyond December, our confidence in margin expansion allows us to project margin improvement in a seasonally down March quarter. In calendar 2014, we currently expect to achieve our quarterly non-GAAP gross margin model of 40%."
