Israel-based Ethernet network processor maker EZchip Semiconductor Ltd. (EZCH: Quote), 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
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