ACADEMIA

22.1 Percent Quarter-over-Quarter Revenue Growth

61.2 Percent Year-over-Year Revenue Growth

Mellanox Technologies has announced record financial results in its first quarter 2012, ended March 31, 2012.

 “The recent launch of Intel Romley and Sandy Bridge-based server and storage platforms has created a significant industry-upgrade and end-user demand for high-performance interconnects. Our FDR 56Gb/s InfiniBand and 10/40GbE interconnect solutions provide these end-users with industry-best performance and return-on-investment.”

First Quarter 2012 Highlights

•     Revenues were a record $88.7 million in the first quarter
•     GAAP gross margins were 67.4 percent in the first quarter
•     Non-GAAP gross margins were 70.0 percent in the first quarter
•     GAAP first quarter operating income was $13.2 million
•     Non-GAAP first quarter operating income was a record $22.8 million
•     GAAP first quarter net income was $12.4 million
•     Non-GAAP first quarter net income was a record $22.0 million
•     GAAP first quarter net income per diluted share was $0.29
•     Non-GAAP first quarter net income per diluted share was a record $0.51
•     A record $23.6 million in cash was provided by operating activities during the first quarter
•     $267.6 million in total cash and investments at March 31, 2012, an increase of $26.1 million from December 31, 2011

Financial Results

In accordance with U.S. generally accepted accounting principles (GAAP), the company reported record revenue of $88.7 million for the first quarter, up 22.1 percent from $72.7 million in the fourth quarter of 2011, and up 61.2 percent from $55.1 million in the first quarter of 2011.

GAAP gross margins in the first quarter of 2012 were 67.4 percent, compared with 64.0 percent in the fourth quarter of 2011 and 64.7 percent in the first quarter of 2011.

Non-GAAP gross margins in the first quarter of 2012 were 70.0 percent, compared with 67.0 percent in the fourth quarter of 2011 and 68.4 percent in the first quarter of 2011.

GAAP net income in the first quarter of 2012 was $12.4 million or $0.29 per diluted share, compared with net income of $4.7 million or $0.11 per diluted share in the fourth quarter of 2011 and a net loss of ($1.6) million or ($0.05) per diluted share in the first quarter of 2011.

Non-GAAP net income in the first quarter of 2012 was a record $22.0 million, or $0.51 per diluted share, compared with $13.1 million or $0.31 per diluted share in the fourth quarter of 2011, and $9.2 million, or $0.24 per diluted share in the first quarter of 2011. The first quarter 2012 non-GAAP net income excludes $7.2 million of share-based compensation expenses compared to $6.1 million in the fourth quarter of 2011, and compared to $4.3 million in the first quarter of 2011. The first quarter 2012 also excludes amortization of acquired intangible assets of $2.4 million associated with the acquisition of Voltaire, Ltd. on February 7, 2011 compared to $2.4 million of such amortization expenses in the fourth quarter of 2011, and compared to $2.1 million in the first quarter of 2011. The first quarter 2011 non-GAAP net income also excludes $4.4 million of acquisition related expenses for Voltaire, Ltd.

Total cash and investments were $267.6 million at March 31, 2012. The company generated a record $23.6 million in cash from operating activities during the quarter.

“Our strong quarterly revenue growth reflects the increased penetration of our high-performance InfiniBand and Ethernet interconnect solutions in new markets, in addition to our traditional High Performance Computing (HPC) market, specifically, the Web 2.0, database, storage and cloud markets,” said Eyal Waldman, chairman, president and CEO of Mellanox Technologies. “The recent launch of Intel Romley and Sandy Bridge-based server and storage platforms has created a significant industry-upgrade and end-user demand for high-performance interconnects. Our FDR 56Gb/s InfiniBand and 10/40GbE interconnect solutions provide these end-users with industry-best performance and return-on-investment.”

Recent Mellanox Highlights

•     April 9 – SHARCNET Selects Mellanox 10 Gigabit Ethernet Switch Systems and Adapters
•     April 9 – Major Cloud Provider Selects Mellanox and Supermicro for New Large-Scale Cloud
•     March 21 – Mellanox Unveils New Interconnect Solutions for Dell to Accelerate Data Center Application Performance
•     March 8 – Mellanox InfiniBand and 40 Gigabit Ethernet Solutions Enhance Windows Server “8” Beta Performance
•     February 21 – Mellanox Leads 10 Gigabit Ethernet NIC Market According to Dell'Oro Group
•     February 21 – Mellanox Rolls Out New Switch and Adapter Products as Part of Its High Density, High-Performance and Cost Effective Suite of 10 Gigabit and 40 Gigabit Ethernet Solutions
•     February 21 – Mellanox End-to-End FDR 56Gb/s InfiniBand and 40GbE Interconnect Solutions Optimized for Forthcoming Intel Romley and Sandy Bridge Platforms