Highlights:
Quarterly revenue grew 16% over fourth quarter 2007;
Annual 3G revenue grew 254%;
Annual WLAN revenue grew 51%;
Generated operating cash flow of $33.5 million in the fourth quarter;
Launched our second generation TRITIUM Module family, offering a 30% size reduction and improved performance for multi-band CDMA Phones;
Announced revolutionary PowerBand Technology and new RF transistor family for broadband applications;
Awarded a $4.5 million contract by the Office of Naval Research;
Honored by Raytheon’s Space and Airborne Systems division with its top Four-Star Supplier Excellence Award, and received 2008 Supplier-of-the-Year award from ZTE Corporation.
Commenting on the results for the year and quarter ended December 31, 2008, Ralph Quinsey, president and chief executive officer, stated “In 2008 TriQuint delivered another solid growth year in spite of dramatic economic slowing in Q4. Inventory reductions throughout the supply chain will have a dampening impact on Q1 revenue while strong design-wins and market share gains position us well for Q2 and beyond. We are aggressively managing expenses but low utilization due to existing inventory levels will put pressure on gross margins until Q2 when supply and demand should be better aligned. Our healthy cash balance and absence of debt allow us to stay focused on opportunities. During this challenging business climate TriQuint will deliver innovation and operational efficiency, creating value out of adversity. TriQuint will emerge as a stronger company.”
Summary Financial Results for the Quarter and Year Ended December 31, 2008:
Revenue for the fourth quarter of 2008 was $149.0 million, up 16% from the fourth quarter of 2007 and a decrease of 20% sequentially following a very strong third quarter. Strong growth in 3G handset products combined with revenue from WJ Communications, which we acquired in the second quarter, drove the increase.
Net loss for the fourth quarter of 2008 was $33.8 million, or ($0.23) per share which includes $35.8 million of impairment charges. Non-GAAP net income for the fourth quarter was $6.6 million or $0.05 per diluted share. Non-GAAP financial measures exclude stock based compensation charges, certain impairment charges and certain charges associated with the acquisition of WJ Communications. Please see the attached supplemental schedule for a reconciliation of GAAP to non-GAAP financial measures. Non-GAAP net income for the year ended 2008 was $40.2 million or $0.27 per diluted share compared with $39.5 million or $0.27 per diluted share for the year ended 2007.
Gross margin for the fourth quarter of 2008 was 30.1%, down from 31.4% in the quarter ended September 30, 2008. On a non-GAAP basis, gross margin was 31.5%, down from a non-GAAP gross margin of 33.0% in the prior quarter. Gross margin decreased due to lower utilization in the factories and higher inventory reserves. Gross margin for the year ended 2008 was 32.4%, an increase from gross margin of 31.8% for the year ended 2007.
Operating expenses for the fourth quarter of 2008 were $75.9 million, or 50.9% of revenue. Included in operating expenses for the fourth quarter of 2008 were $33.9 million of charges relating to the impairment of goodwill. Non-GAAP operating expenses for the quarter were $39.9 million or 27.1% of revenue, a decrease of 10% from the prior quarter. Operating expenses for the year ended 2008 were $199.8 million compared with $135.1 million for the year ended 2007. Non-GAAP operating expenses for the year ended 2008 were $156.9 million, an increase of 28% from the year ended 2007. Excluding non-GAAP operating expenses for WJ Communications, the increase was 21%.
Cash, cash equivalents and short-term investments were $86.1 million as of December 31, 2008, an increase of $5.9 million from September 30, 2008. Investments with a maturity between one and two years were $15.9 million. During the quarter, the company paid down the $13.0 million balance on its revolving loan.
Outlook:
The company estimates that first quarter 2009 revenue will be between $110.0 million and $120.0 million. First quarter net loss is expected to range between $0.10 and $0.14 per share and non-GAAP loss is expected to range between $0.07 and $0.11 per share. As of today the company is 90% booked to the midpoint of revenue guidance for the first quarter. The company is not guiding for full year performance due to the uncertainty caused by the current economy but expects 2009 to be a moderate revenue growth year.
