Marvell: Fiscal 1Q15 Financial Results
Storage revenue declined 6% sequentially, 44% of total sales
This is a Press Release edited by StorageNewsletter.com on May 23, 2014 at 3:00 pm| (in $ million) | 1Q14 | 1Q15 |
| Revenue | 734.4 | 957.8 |
| Growth | 30% | |
| Net income (loss) |
53.2 | 99.5 |
Marvell Technology Group Ltd. reported financial results for the first quarter of fiscal year 2015, ended May 3, 2014.
Key First Quarter of Fiscal 2015 Financial Highlights
- Revenue: $958 million
- GAAP Net Income: $99 million
- GAAP Diluted EPS: $0.19
- Non-GAAP Net Income: $144 million
- Non-GAAP Diluted EPS: $0.27
- Free Cash Flow: $211 million
Second Quarter of Fiscal 2015 Financial Outlook
- Revenue is expected to be in the range of $940 to $980 million.
- GAAP Gross Margin is expected to be in the range of 49.7% +/- 100 bps. Non-GAAP Gross Margin is expected to be in the range of 50.0% +/- 100 bps.
- GAAP Operating Expenses are expected to be in the range of $365 million +/- $10 million. Non-GAAP Operating Expenses to be in the range of $330 million +/- $10 million.
- GAAP Diluted EPS expected to be in the range of $0.21 +/- $0.02. Non-GAAP Diluted EPS expected to be in the range of $0.28 +/- $0.02.
First Quarter of Fiscal 2015 Summary
Revenue for the first quarter of fiscal 2015 was $958 million, an increase of 3% from $932 million in the fourth quarter of fiscal 2014, ended February 1, 2014, and a 30% increase from revenue of $734 million in the first quarter of fiscal 2014, ended May 4, 2013.
GAAP net income for the first quarter of fiscal 2015 was $99 million, or $0.19 per share (diluted), compared with GAAP net income of $97 million, or $0.19 per share (diluted), for the fourth quarter of fiscal 2014, and $53 million, or $0.11 per share (diluted), for the first quarter of fiscal 2014.
Non-GAAP net income was $144 million, or $0.27 per share (diluted), for the first quarter of fiscal 2015, compared with non-GAAP net income of $151 million, or $0.29 per share (diluted), for the fourth quarter of fiscal 2014 and $98 million, or $0.19 per share (diluted), for the first quarter of fiscal 2014.
“We delivered solid first quarter results, driven by better than expected demand for our LTE solutions,” said Dr. Sehat Sutardja, chairman and CEO. “Looking forward, we continue to focus on increasing our share across all our end markets and are investing appropriately in advanced technologies that will drive our success.“
GAAP gross margin for the first quarter of fiscal 2015 was 48.4%, compared to 48.8% for the fourth quarter of fiscal 2014 and 54.3% for the first quarter of fiscal 2014.
Non-GAAP gross margin for the first quarter of fiscal 2015 was 48.8%, compared to 50.1% for the fourth quarter of fiscal 2014 and 54.6% for the first quarter of fiscal 2014.
Shares used to compute GAAP net income per diluted share for the first quarter of fiscal 2015 were 521 million shares, compared with 510 million shares in the fourth quarter of fiscal 2014 and 505 million shares in the first quarter of fiscal 2014.
Shares used to compute non-GAAP net income per diluted share for the first quarter of fiscal 2015 were 530 million shares, compared with 523 million shares for the fourth quarter of fiscal 2014 and 522 million shares for the first quarter of fiscal 2014.
Cash flow from operations for the first quarter of fiscal 2015 was $235 million, compared to the $100 million reported in the fourth quarter of fiscal 2014 and the $84 million reported in the first quarter of fiscal 2014. Free cash flow for the first quarter of fiscal 2015 was $211 million, compared to the $82 million reported in the fourth quarter of fiscal 2014 and the $53 million reported in the first quarter of fiscal 2014. Free cash flow as presented above is defined as cash flow from operations, less capital expenditures and purchases of technology licenses reported under investing and financing activities in the consolidated statement of cash flows.
Marvell paid a quarterly dividend of $0.06 per share on March 27, 2014 to all shareholders of record as of March 13, 2014. Marvell intends to pay its next quarterly dividend of $0.06 per share on July 2, 2014 to all shareholders of record as of June 12, 2014.
The payment of future quarterly cash dividends on Marvell’s common shares is subject to, among other things, the best interests of its shareholders, its results of operations, cash balances and future cash requirements, financial condition, developments in ongoing litigation, statutory requirements of Bermuda law, and other factors that the board of directors may deem relevant.
Comments
Abstracts of the earnings call transcript:
Sehat Sutardja, chairman and CEO:
"Starting with HDD, our business declined in the quarter due to a typical seasonality. However, on a year-over-year basis our HDD revenue grew modestly despite the decline in the overall term as we continue to gain share.
"In the enterprise space, we continue to see share gains at a top North America-based HDD customer. Overall for HDDs, we are accelerating our investments in the next-generation technologies. We believe this will allow us to further increase our share and solidify our leadership position in the market for the next few years.
"Next in SSD; we have better than expected results and another record quarter. Our units and revenue increased double-digits sequentially.
"In addition, we sampled our fifth generation LDPC technology, which addresses next-generation flash. We believe this technology will be a key enabler for volume adoptions of 15 nanometer 2D NAND and in the future for 3D NAND as well.
"We expect our mass productions of these products starting in 2015. We also sampled new PCI-based products during the quarter. Our SSD business remains on track to grow strongly in the fiscal 2015. For Q2, we expect our storage and market to be flat due to the typical seasonality and in line with the market."
Michael Rashkin, CFO:
"In storage our overall revenue declined 6% sequentially and represented approximately 44% of total sales. Our HDD business declined seasonally as expected. However, our SSD business performed better than expected and grew double-digit sequentially."
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