- EZchip (EZCH) has guided on its Q1 CC (prepared remarks - .pdf) for Q2 revenue of $27.5M-$28.5, in-line with a $28.3M consensus. Gross margin is expected to be around 75% - it was at 74% in Q1, down from 81.7% a year ago thanks to the Tilera acquisition.
- The company also tried hard to argue it can offset Cisco's decision not to use EZchip's NPS-400 NPU in its next-gen edge router line cards with various NPS-400 design wins from carriers, networking hardware vendors, and (Internet) data center owners. Tilera's TILE-Mx processors (support up to 100 ARM cores, aimed at data centers) were also cited as a future growth driver.
- Cisco accounted for 35% of EZchip's Q1 revenue, and ZTE 8%; Cisco sales are expected to grow in 2015 as NP-5 shipments ramp. The NPS processor line is expected to start producing revenue "as early as 2016," and the TILE-Mx line in 2017.
- Shares remain down sharply, but have slightly pared their premarket losses.