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24 July 2009


TriQuint’s revenue rises 42% sequentially

For second-quarter 2009, RF product maker and foundry services provider TriQuint Semiconductor Inc of Hillsboro, OR, USA has reported greater-than-expected revenue of $169.1m, up 42% on $118.9m last quarter and 33% on $127m a year ago.

Revenue was split between Asia (59%), Americas (35%) and Europe 6%, compared to 53%, 38% and 9%, respectively, last quarter. By application sector, 65% came from handsets, 23% from networks, and 12% from defense.

Sequential growth in handset and defense revenues was 56% and 25%, respectively. Networks revenue grew 16%, but remained below historic levels as 3G expansions in China was offset by conservative inventory management and slow capital spending on infrastructure worldwide. Networks business is suffering the most from the impact of the economy, notes chief financial officer Steve Buhaly. Revenue mix hence contained more handset and less network revenue than usual.

On a non-GAAP basis, gross margin rose significantly from 21% last quarter to 33.2% (as improved factory utilization of 66% and improved handset margins offset the low mix of networks products). However, this is still down on 37% a year ago, impacted by inefficiencies associated with the very high sequential revenue growth as well as ramping the new RF filter line. 

Non-GAAP operating expenses have risen 19% from last quarter’s $37.3m to $44.3m (26.2% of revenue). However, this is just back to historic levels, due mainly to the end of temporary cost-control measures imposed in Q1/2009 (which included mandatory time-off, restrictions on discretionary spending etc).

Compared to a net loss of $11m last quarter, non-GAAP net income was $11.5m, up on $9.6m a year ago. Cash flow from operations was $9.6m, while cash, cash equivalents, and investments remained constant at $99.4m. Capital spending was $12.5m (roughly equivalent to depreciation and amortization).

“Sales and earnings exceeded expectations on the strength of handset and defense & aerospace product revenue,” comments president & CEO Ralph Quinsey. “The company responded well to a roller-coaster ride of uncertainty and demand volatility,” he adds.

“I see sustained demand in the second half of 2009 for handset and defense products and continued recovery in the health of our networks market,” says Quinsey. “I expect solid handset revenue in Q3 supported by the popularity of smart-phones,” he adds.

For third-quarter 2009, TriQuint expects revenue of $170-180m (flat to up about 6.5% on last quarter, driven by renewed shipments of wireless LAN products). The firm also expects non-GAAP operating expenses to rise slightly to $46-48m, but gross margin to rise to 35%. Cash is expected to increase by about $10m. As of 22 July, TriQuint was 89% booked to the midpoint of revenue guidance. In addition, Q4 should be slightly stronger than Q3, adds Quinsey.

TriQuint’s long-term goals are non-GAAP gross margin of 40%, operating expenses of 25% of revenue, and operating margin of 15%. “Demand volatility and the softness of our networks market have been headwinds to these goals,” says Quinsey. But, despite uncertainty remaining in the macroeconomic outlook, he is confident that TriQuint is growing its share of the networks market. “I anticipate steady and improved demand throughout 2009-10 and beyond as the optical and cable markets recover and we execute our ramp of TriQuint products,” he concludes.

See related items:

TriQuint sees demand return as handset inventory burns off

Impairment charges drive TriQuint into Q4 loss

TriQuint cuts Q4 revenue guidance from $160-175m to $140-145m

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