Applied Micro Circuits Corporation
) swung to profit on a non-GAAP year-over-year basis in the third
quarter of fiscal 2014. Excluding non-recurring items, non-GAAP
net income for the quarter was $1.6 million or 2 cents per share
versus a net loss of $6.9 million or loss of 10 cents per share
in the year-earlier quarter. Non-GAAP earnings were in line with
the Zacks Consensus Estimate.
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On a GAAP basis, Applied Micro reported a net loss of $7.3
million or loss of 10 cents per share in the quarter ended Dec
31, 2013 compared with a net loss of $71.6 million or loss of
$1.08 per share in the year-ago quarter.
Net revenues for the third quarter of fiscal 2014 were $54.8
million versus $51.7 million in the year-ago quarter. Net sales
for the reported quarter were in line with Applied Micro's
guidance although it marginally missed the Zacks Consensus
Estimate of $55.0 million.
Revenues from the computing business grossed $28.8 million, while
connectivity business generated $26.0 million in the quarter.
Geographically, sales to North America accounted for
approximately 47% of total revenue, followed by Asia (36%) and
Operating expenses for the reported quarter decreased to $40.9
million from $101.9 million in the year-ago quarter, primarily
due to a significant decline in research and development
(R&D) expenses. Selling, general and administrative expenses
were $10.9 million versus $12.7 in the year-ago quarter. R&D
expenses were $29.9 million in third quarter fiscal 2014 versus
$82.7 million in the prior-year period.
Applied Micro ended the quarter with cash, cash equivalents and
short-term investments of $74.3 million versus $76.0 million as
of Sep 30, 2013. Net cash used in operating activities was $33.4
million for the nine months ended Dec 31, 2013, versus $30.9
million in the year-ago period.
Exiting the quarter, Applied Micro entered into a formal
arrangement with an undisclosed company to sell its corporate
headquarters building and land in Sunnyvale, Calif. The cash
transaction worth approximately $40 million is expected to close
in mid-March. The strategic move is aimed at monetizing an
underutilized asset and increasing the liquidity of the
Applied Micro expects to continue its healthy revenue momentum
with new product introductions in the coming quarters.
The company expects embedded computer products to continue to
generate solid revenue growth in the next 18 to 24 months as it
transitions to X-Gene based embedded products.
For fourth quarter fiscal 2014, total revenue is expected in the
range of $50 million to $54 million. Non-GAAP operating
expenses are expected within $31.0 million and $32.0 million in
the next quarter.
Applied Metro currently has a Zacks Rank #5 (Strong Sell). Other
stocks that look promising and are worth considering in the
Himax Technologies, Inc.
Vishay Intertechnology Inc.
), each carrying a Zacks Rank #2 (Buy).