FONT-SIZE Plus   Neg

EZchip Profit Tops Estimate; But Stock Down - Update

Israel-based Ethernet network processor maker EZchip Semiconductor Ltd. (EZCH), Wednesday reported a swing to fourth-quarter profit, on higher revenues and the absence of one-time charges incurred a year ago. The company's earnings and revenues for the quarter also topped Street estimates.

EZchip said that Huawei, one of its five major NP-4 network processor customers, has not yet placed any production orders and may "offer a lower-end in-house solution in parallel to the high-end NP-4 solution."

The company said it believes that NP-4 can prop up its revenues in the next few years, and expects year-over-year growth in 2013 when compared with 2011.

Investors were mostly unimpressed with the results, dragging EZchip shares down by about 10 percent in morning trade on the Nasdaq.

EZchip reported fourth-quarter net income of $4.8 million or $0.17 per share, compared with a net loss of $6 million or $0.22 per share last year.

Results for the prior year included a charge of $10 million related to early repayment to the Israeli Office of Chief Scientist.

Excluding items, adjusted earnings for the quarter were $7.8 million or $0.26 per share, compared with $6.3 million or $0.22 per share a year ago.

Analysts polled by Thomson Reuters expected earnings of $0.21 per share for the quarter. Analysts' estimates typically exclude special items.

Total revenues in the quarter increased 7 percent to $15 million from $14 million in the prior year. Analysts on consensus estimated revenues of $14 million for the quarter.

Gross margin for the quarter expanded to 83.2 percent from 6.6 percent a year ago.

EZchip is trading at $29.06, down 9.86%, on a volume of 1.8 million shares.

by RTT Staff Writer

For comments and feedback: editorial@rttnews.com

Business News

Editors Pick
Chipmaker Qualcomm is reportedly in talks with NXP Semiconductor NV (NXPI) for a possible acquisition, reports said. According to Bloomberg, negotiations are on with a probable price of $110 t $120 per NXP share. The deal would value NXP at around $34.7 billion. Regulators have confirmed the eleventh U.S. fatality linked to Takata Corp.'s defective air bag inflators. The National Highway Traffic Safety Administration or NHTSA said Thursday that a crash fatality in Riverside County, California, was tied to the rupture of a recalled Takata air bag inflator. Reynolds American Inc. (RAI) on Friday confirmed that British American Tobacco plc (BATS.L, BTI) has offered to buy the remaining 57.8 percent stake that it does not own in the US tobacco company for $47 billion. Reynolds said its board of directors will evaluate the offer, and respond accordingly to BAT, which currently owns 42.2 percent stake in Reynolds. The proposal represents an enterprise va
comments powered by Disqus
Follow RTT