STORAGE

Mellanox Technologies has announced financial results for its first quarter 2013, ended March 31, 2013.

First Quarter 2013 Highlights

• Revenues were $83.1 million
• GAAP gross margins were 65.2 percent
• Non-GAAP gross margins were 68.1 percent
• GAAP operating loss was $7.9 million
• Non-GAAP operating income was $4.9 million
• GAAP net loss was $8.5 million
• Non-GAAP net income was $4.3 million
• GAAP net loss per diluted share was $0.20
• Non-GAAP net income per diluted share was $0.10
• Cash and investments totaled $402.9 million at March 31, 2013

Financial Results

In accordance with U.S. generally accepted accounting principles (GAAP), the company reported revenue of $83.1 million for the first quarter, down 32.0 percent from $122.1 million for the fourth quarter 2012, and down 6.4 percent from $88.7 million for the first quarter of 2012.

GAAP gross margins in the first quarter of 2013 were 65.2 percent, compared with 68.1 percent in the fourth quarter of 2012 and 67.4 percent in the first quarter of 2012.

Non-GAAP gross margins in the first quarter of 2013 were 68.1 percent, compared with 70.0 percent in the fourth and first quarters of 2012.

GAAP net loss in the first quarter of 2013 was $8.5 million or $0.20 per diluted share, compared with net income of $18.4 million or $0.41 per diluted share in the fourth quarter of 2012 and net income of $12.4 million or $0.29 per diluted share in the first quarter of 2012.

Non-GAAP net income in the first quarter of 2013 was $4.3 million, or $0.10 per diluted share, compared with $30.7 million, or $0.69 per diluted share in the fourth quarter of 2012, and $22.0 million, or $0.51 per diluted share in the first quarter of 2012. The first quarter 2013 non-GAAP net income excludes $10.4 million of share-based compensation expenses compared to $10.0 million in the fourth quarter of 2012 and to $7.2 million in the first quarter of 2012. The first quarter 2013 non-GAAP net income also excludes amortization of acquired intangible assets of $2.4 million associated with the acquisition of Voltaire, Ltd. on February 7, 2011 compared to $2.3 million of such amortization expenses in the fourth quarter of 2012 and to $2.4 million in the first quarter of 2012.

Total cash and investments decreased by $23.4 million to $402.9 million at March 31, 2013 compared to $426.3 million at December 31, 2012.

“Despite the decline in our financial results over the past two quarters, we believe increased demand will restore growth in coming quarters,” said Eyal Waldman, president, CEO and chairman of Mellanox Technologies. “In the first quarter, our FDR InfiniBand revenue share increased from 39 percent to 50 percent, demonstrating the continued demand for our highest performing InfiniBand products. We expect that our future growth will be driven by the increased adoption of FDR InfiniBand as well our 10/40/56Gb/s Ethernet products.”