• Net revenue increased to a record $29.1 million, up 29% from the same quarter last year
• Gross margins were 79.1%
• Net income: $5.2 million GAAP, $9.6 million non-GAAP
• Net income per diluted share: $0.16 GAAP, $0.28 non-GAAP
• $6.7 million in cash provided by operating activities
• $171 million in total cash and investments at quarter end

Financial Results In accordance with U.S. generally accepted accounting principles (GAAP), the company reported record revenue of $29.1 million, up from $28.2 million in the second quarter of 2008 and up from the $22.7 million reported in the third quarter of 2007. Gross margins in the third quarter were 79.1 percent, compared with 79.8 percent in the second quarter of 2008 and 74.9 percent reported in the third quarter a year ago. GAAP net income in the third quarter was $5.2 million or $0.16 per diluted share and included a tax expense of $2.4 million from the realization of deferred tax assets and $2.0 million of share-based compensation expense. On a non-GAAP basis, the company recorded third quarter net income of $9.6 million, or $0.28 per diluted share, consistent with $9.6 million or $0.28 per diluted share in the second quarter of 2008, and up from $8.0 million or $0.24 per diluted share in the third quarter of 2007. These non-GAAP net income results exclude share-based compensation expenses and the realization of deferred tax assets. Total cash and investments were $171 million at Sept. 30, 2008. The company generated $6.7 million in cash from operating activities during the quarter. “We are very pleased to see the increased adoption of our InfiniBand products within mainstream data center business applications, highlighted by September’s announcement of the new HP Oracle Database Machine, a mixture of Mellanox-based InfiniBand storage and rack servers,” said Eyal Waldman, chairman, president, and CEO of Mellanox Technologies. “During the quarter, we increased our product deployments within the Embedded and HPC markets, tripled shipments of our 40Gb/s products, and were awarded two prominent 10 Gigabit Ethernet design-wins.”