26 October 2010


RFMD’s quarterly revenue grows 12% year-on-year to record $285.8m

For its fiscal second-quarter 2011 (ended 2 October 2010), RF Micro Devices Inc of Greensboro, NC, USA has reported its sixth quarter of sequential revenue growth, to $285.8m (up 4.4% on $273.8m last quarter and up 12.2% on $254.8m a year ago).











RFMD achieved substantial year-on-year and continued sequential revenue growth in both its Cellular Products Group (CPG) and its Multi-Market Products Group (MPG). During the quarter, RFMD secured major design wins, including components for smartphones, mobile tablet devices, smart energy applications, high-power GaN applications, and wireless infrastructure. Sales to customers outside RFMD’s largest customer (Nokia) grew by about 53% year-on-year, driven by market share gains at targeted handset customers and broad-based growth in MPG’s end markets. RFMD also launched 74 new and derivative products targeting diverse market segments.

“During the September quarter, RFMD continued to transition successfully to a more diversified revenue base, with notable strength in smartphones, smart energy, and high-performance WiFi,” says president & CEO Bob Bruggeworth. “Importantly, RFMD is also experiencing strong design-win momentum for our new breakthrough products and technologies, including our PowerSmart power platform, our silicon-based switches and our gallium nitride-based components,” he adds.

“During the September quarter, RFMD demonstrated robust financial performance and achieved several all-time financial records,” remarks chief financial officer & VP of administration Dean Priddy.

On a non-GAAP basis, gross margin has grown from 38.1% a year ago and 39.2% last quarter to 39.8%. Operating income has risen from $41.7m a year ago and $51.7m last quarter to $57.1m (the fifth consecutive quarter of record operating income). Operating margin was 20% of revenue (up from 18.9% last quarter). Net income has risen from $36.9m a year ago and $44.3m to another record of $52.3m.

During the quarter, RFMD generated a record $56.1m in free cash flow (net cash provided by operating activities of $61.3m, minus $5.2m in property and equipment expenditures) and achieved a positive net cash position.

“RFMD’s record quarterly financial performance is the direct result of prior structural changes in strategy and the organization’s crisp execution on that strategy,” comments Bruggeworth. “We are leveraging product and technology leadership to drive our growth in core markets, and we are securing the major design wins necessary to power the next wave of our revenue growth,” he adds.

RFMD believes that the demand environment in its end markets supports its expectation that December-quarter results will be approximately in line with September-quarter results. In particular, the firm expects the sequential growth in its core markets to be broad based and supported by strength in smart energy, high-performance WiFi, wireless infrastructure, fixed and mobile broadband, smartphones and 3G connected devices. RFMD also expects to continue ramping new customer programs to offset declining end-of-life legacy products. “We continue to forecast PowerSmart will ramp in the March 2011 quarter, and we now expect our lead PowerSmart customer will broadly feature PowerSmart across their next-generation smartphone portfolio,” says Bruggeworth.

For full-year fiscal 2011, RFMD now expects to achieve record free cash flow of $180–200m (up on fiscal 2010’s $177m).

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