The new product sales increased to 51%. The fourth quarter sales were $314.5 million, down 3%, compared with the fourth quarter 2007 sales and down 12%, compared with the third quarter 2008. Fourth quarter net income was $83.0 million, $0.28 per diluted share, up from net income of $65.5 million, $0.20 per diluted share, in the fourth quarter of 2007.
The company repurchased 26.6 million shares of its common stock during 2008 at a cost of $473.2 million, with 9 million shares repurchased during the fourth quarter at a cost of $154.2 million. The company ended the quarter with $1.2 billion in cash and short-term investments.
While we experienced the effects of a global economic-driven slowdown in the fourth quarter, we increased our market share in the programmable logic industry for the sixth year in a row. Net income growth substantially outpaced sales growth as a result of our sustained focus on improving efficiencies across the company. We will apply these simplification and cost reduction skills in this current challenging business environment to help protect shareholder value, stated John Daane, president, chief executive officer, and chairman of the board. As previously committed, we shipped our first 40-nm Stratix IV FPGAs in the fourth quarter, placing us in a leadership position that will strengthen our competitive position in 2009 and beyond.
Many recent accomplishments mark company’s continuing progress.
Following the introduction of the development software in May 2008, the company started shipping Stratix IV FPGAs in December 2008. As the only supplier of 40-nm FPGAs in the industry, the company’s customers will benefit from the largest density, highest performance, highest system bandwidth, and lowest power among high-end FPGA solutions. With increasing demand for the services like video over Internet, high-speed wireless data and digital TV, designers need to deliver solutions that offer higher data rates, higher interface bandwidths, and increased data processing all in a power-efficient manner. To address these design challenges, Stratix IV FPGAs leverage the company’s innovations in transceivers, memory interfaces, low-power technology and FPGA core architecture to provide new capabilities in its 40-nm devices. For designers faced with sharply increased ASIC design costs and otherwise limited to lagging node technology, the comparative economics and performance advantages of advanced-node FPGAs are compelling. The company is in a unique position to compete for these new design wins and gain the increased share in the FPGA market, which will continue to be the fastest growing portion of programmable logic industry.
Even though just launched, combination of the process node and the architectural leadership represented by Stratix IV FPGAs has already led to wide industry recognition:
The China Electronics News selected Stratix IV FPGAs as its 2008 Editor’s Choice Award winner in the FPGA category. Winners of this award demonstrated a major leap in innovation.
EDN named Stratix IV FPGAs to its annual list of Hot 100 Electronic Products. This list includes the 100 most major products of 2008, as determined by magazine’s editors and readers.
The Stratix IV FPGAs received EDN China’s Leading Products Award in the digital IC and programmable logic category. The winners of this award were chosen by a panel of technical experts and the professors that selects products having the greatest impact on the electronics industry.
The Stratix IV FPGAs received Electronic Products’ 2008 Product of the Year award in the digital ICs category. The award winners are selected by the magazine’s editors based on innovative design, major advancement in technology or application and substantial achievement in price and performance.
Recognizing the company’s overall business performance, Forbes.com identified the company as the best managed company in the semiconductor category. The company was selected from Forbes.com’s Platinum 400 and chosen based on sales and earnings growth, debt to total capital, earnings outlook and stock market returns.
