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Q3 2013 Earnings Call
October 30, 2013 4:30 pm ET
Nick Kormeluk - President and Founder
Kishore Seendripu - Co-Founder, Chairman, Chief Executive Officer and President
Adam C. Spice - Chief Financial Officer and Vice President
Tore Svanberg - Stifel, Nicolaus & Co., Inc., Research Division
Ross Seymore - Deutsche Bank AG, Research Division
N. Quinn Bolton - Needham & Company, LLC, Research Division
Gary W. Mobley - The Benchmark Company, LLC, Research Division
Alex Gauna - JMP Securities LLC, Research Division
Anil K. Doradla - William Blair & Company L.L.C., Research Division
Jay Srivatsa - Chardan Capital Markets, LLC, Research Division
Previous Statements by MXL
» MaxLinear, Inc. Discusses Q3 2013 Results (Webcast)
» MaxLinear Management Discusses Q2 2013 Results - Earnings Call Transcript
» MaxLinear Management Discusses Q1 2013 Results - Earnings Call Transcript
I would now like to turn the conference over to Mr. Nick Kormeluk. Go ahead, sir.
Thank you, operator. Good afternoon, everyone, and thank you for joining us on today's conference call to discuss MaxLinear's Third Quarter 2013 Financial Results. Today's call is being hosted by Dr. Kishore Seendripu, CEO; and Adam Spice, CFO.
During the course of this conference call, we will make projections or other statements regarding future conditions or events relating to our products and business. Among these statements, we will provide information relating to our current expectations for fourth quarter 2013 revenue, including expectations for revenue growth in our cable, terrestrial, satellite and other target markets; gross profit percentage and operating expenses; and our current views regarding trends in our markets, including our views of the potential growth for our cable, terrestrial and satellite market.
These statements are forward-looking statements within the meaning of federal securities laws and actual results may differ materially from results reflected in these forward-looking statements. We are subject to substantial risks and uncertainties that could adversely affect our future results.
Our business and future operating results could be adversely affected if our current target markets, including the terrestrial, cable and satellite markets, do not grow or if we are not successful in expanding our target-addressable markets through the introduction of new products. In addition, substantial competition in our industry; potential declines in average selling prices, risks relating to intellectual property protection and the prevalence of intellectual property litigation in our industry and cyclicality in the semiconductor industry could adversely affect future operating results.
A more detailed discussion of these risk factors and other factors you should consider in evaluating MaxLinear and its prospects is included under the caption "Risk Factors" in our filings with the Securities and Exchange Commission, in particular, our most recently filed 10-K for fiscal 2012, subsequent quarterly filings and our upcoming 10-Q for the third quarter of 2013.
These forward-looking statements are made as of today, and MaxLinear does not currently intend and has no obligation to update or revise any forward-looking statements. The third quarter 2000 (sic) earnings release is available on the company's website at maxlinear.com.
In addition, MaxLinear reports gross profit income or loss from operations, and net income loss and basic and diluted net income loss per share in accordance with GAAP and, additionally, on a non-GAAP basis.
Our non-GAAP presentations exclude the effect of stock-based compensation expense and its related tax effect, net expenses associated with a prior export compliance matter, accruals under our equity settled performance-based bonus plan, expenses associated with our acquisition of certain new market-related technology licenses, expenses related to prior patent litigation matter with Silicon Laboratories and mask-related asset impairments. Management believes that this non-GAAP information is useful because it can enhance the understanding of the company's ongoing economic performance. And MaxLinear, therefore, uses non-GAAP reporting internally to evaluate and manage the company's operations.
MaxLinear has chosen to provide this information to investors to enable them to perform comparisons of operating results in a manner similar to how the company internally analyzes its operating results. The full reconciliation of GAAP to non-GAAP financial data can be found in our earnings release issued earlier today. The earnings release and reconciliation is also available on our website and we ask that you review them in conjunction with this call.
And now, let me turn the call over to Kishore Seendripu, CEO of MaxLinear.
Thank you, Nick, and good afternoon, everyone. Thank you, all, for joining us today. Before jumping into the financial highlights, I would like to note that our third quarter 2013 financial results not only represent a record revenue quarter but also mark a double-digit year-over-year revenue growth for the company.
Our strong revenue growth was derived from our industry-leading products targeting some of the most exciting and dynamic broadband content applications, such as cable DOCSIS 3.0 data modems, cable media server gateways, hybrid televisions and a variety of set-top boxes. These results and related momentum at growth markets strengthen our confidence as we focus our investment towards the expansion of our target addressable markets. These new target markets will be ideally suited for our industry-leading, low-power, RF-mixed signal broadband technology platform.
I'm also pleased that MaxLinear was able to satisfactorily settle its intellectual property dispute with Silicon Labs, thereby eliminating customer and investor concerns regarding our ability to ship products into the United States and to fully mitigate related litigation costs.
Moving to the financial specifics. Net revenue in the third quarter was $31.8 million, up 7% from the second quarter of 2013 and up 14% on the year ago quarter and about the midpoint of our guidance. GAAP and non-GAAP gross margin in the third quarter were 62% and 63% of revenue, respectively.