ANADIGICS, Inc. (ANAD)
Q1 2010 Earnings Call Transcript
April 26, 2010 5:00 pm ET
Tom Shields – EVP & CFO
Mario Rivas – President & CEO
Anthony Stoss – Craig-Hallum
Patrick Newton – Stifel Nicolaus
Steve Ferranti – Stephens, Inc.
Aalok Shah – D.A. Davidson
Todd Koffman – Raymond James
Mike Alexander – Charter Equity
Cameron White [ph] – Jay A. Fishman Limited
Richard Shannon – Northland Securities
Mike Burton – FBN Securities
Shashi Rao – Credit Suisse
Previous Statements by ANAD
» ANADIGICS, Inc. Q4 2009 Earnings Call Transcript
» ANADIGICS, Inc. Q3 2009 Earnings Call Transcript
» ANADIGICS Q2 2009 Earnings Transcript
I will now turn the call over to Mr. Tom Shields, Chief Financial Officer. Sir, you may begin your conference.
Thank you, operator. Good evening, everyone, and welcome to the ANADIGICS First Quarter 2010 Earnings Conference Call. Before we get started, please remember any comments made in this call by management as part of prepared remarks or in response to your questions may contain forward-looking information. Such information is subject to risks and uncertainties as described in this evening's press release and in the Company's various filings with the SEC.
I would now like to turn the call over to Mario for his opening comments.
Thank you, Tom and good evening everyone. I’m very pleased to report our revenue of 43.5 million in the first quarter of 2010 marks our fourth consecutive quarter of revenue growth. Revenue grew 4% over to prior quarter, 43% year-over-year and surpassed our expectations of being flat sequentially.
Our growth in the first quarter comes as a result of 22% sequential growth in our wireless product line at the high level of handset design wins secured in the second half of 2009 that continued to move into production.
Our customer relationships are stronger than ever, with the return of Samsung to our top 10% customer list, joining RIM, LG and our Asia Pacific distributor, World Peace Group. These customers continue to play a key role in our revenue expansion as we won designs at all of our major existing customers during Q1.
The strong growth momentum we have achieved over this past several quarters is a direct result of the successful execution of our 2009 business initiatives and outlines the trajectory anticipated for 2010. We are expecting continued double-digit revenue growth in wireless in the second quarter and are anticipating achieving another key financial milestone for the company – the profit and non-GAAP net income equivalent to break even EPS for the quarter. Just a few quarters ahead of most expectations.
The core drivers of ANADIGICS continue growth are strength in the growing 3G and 4G wireless markets, which is being further fueled by our top customers gaining market share in the respective market as well as the increasing power amplifier content in 3G handset.
We expect this favorable market trends to continue as we further capitalize on the increasing design win opportunities that leverage ANADIGICS best-in-class, InGap-Plus BiFET technology.
Order trends in wireless for our HELP3 power amplifiers were particularly stronger in the quarter with high attach rate across multiple customers. We continue to see a transition to our HELP3 plus coupler products, which not only simplify RF design for many popular 3G chipset but are also differentiated by their high linearity and power efficiency.
Also during the quarter we had a better than expected growth in WiMAX, dual band wideband CDMA and our cable business. Specifically, our cable business benefited from recent infrastructure build out in developing countries which we expect to be consistent for the rest of the year. Additionally, we are gaining market share in the China market with some of the leading handset suppliers in TD-SCDMA.
I now like to give an update on our 2010 initiatives which are continuing to leverage our operational excellence, introduction of superior products win business over our competitors, capitalizing on the growth of 3G and 4G markets. And as a result, achieving profitability.
Starting with operational excellence, we continue to focus on maintaining operational excellence as we scale to higher levels of production. Our fab cycle times are consistently averaging less than 30 days with yield in the mid-90s.
We are also continuing to build our high manufacturing strategy with win semiconductors as part of our commitment to be prepared for large scale growth in the future.
Let’s talk about our new products, which are the key drivers of our growth. We exited 2009 with unprecedented pipeline of new products. I’m pleased to report that during the first quarter of 2010 we released seven new products across several product families, including dual band PA, HELP3 plus coppers and HELP4.
In February, we announced a latest version of our very successful dual band CDMA power amplifiers which have thrown a lot of customer interest and in March, we announced our new HELP4 power amplifier which is the industry most efficient power amplifiers for the 4G LTE and 3G HSPA plus mobile market.
We continue to focus on advancing ANADIGICS leadership position in the LTE market and we are actively sampling parts with customers in order to position ourselves for the larger scale roll out next year.
Turning to profitability, as stated earlier, getting to profitability is a critical milestone for the company. For the second quarter, we are expecting a profit in non-GAAP net income equivalent to break even EPS for the quarter, which is a few quarters ahead of most expectations. Our wireless growth is anticipated to be approximately 20% in Q2, demonstrating traction and market share gains.