Tue, Jan. 27, 10:26 AM
- Declaring there's limited upside to its $50 target, Jefferies has cut Mellanox (NASDAQ:MLNX) to Hold ahead of tomorrow's Q4 report. The Nasdaq is off 1.7%.
- Summit Research forecast in-line results and guidance yesterday. Like others, it thinks Intel's Grantley Xeon server CPU launch boosted demand from Mellanox's HPC clients (50%-60% of revenue). Grantley and strong demand from Internet giants helped Intel report a 25% Y/Y increase in Q4 server CPU division sales.
Tue, Jan. 13, 10:33 AM
- Emulex (NYSE:ELX) now expects FQ2 revenue of $110M-$111M and EPS of $0.23-$0.24, above prior guidance of $102M-$108M and $0.14-$0.18; consensus is at $105.7M and $0.16.
- CEO Jeff Benck: "Emulex finished calendar year 2014 in a much stronger position led by a resilient Fibre Channel sector and benefiting from solid execution and customers' embrace of our current product cycles." The company sees a "broad slate of OEM qualifications of our 10Gb Ethernet products designed for next generation x86 servers [ramping] in the market over the next year."
- Full FQ2 results arrive on Jan. 29. Improving server demand appears to have provided a lift.
- Archrival QLogic (QLGC +5.7%) and InfiniBand/Ethernet adapter and switch vendor Mellanox (MLNX +3%) are also outperforming, as is Fibre Channel switch leader Brocade (BRCD +3.2%). The Nasdaq is up 1.7%.
Dec. 18, 2014, 7:04 PM
- A Northern California judge has granted Mellanox's (NASDAQ:MLNX) motion to dismiss a class-action suit accusing the company and its management of violating federal securities laws.
- Mellanox was accused of making false/misleading statements from July 2012 to January 2013 regarding its business and outlook. Its shares fell sharply during that timeframe after previously soaring into the triple digits. A revenue warning was issued on Jan. 2, 2013.
Dec. 4, 2014, 7:04 PM
- With a corporate upgrade cycle and Web/cloud demand boosting sales, IDC estimates global server revenue rose 4.8% Y/Y in Q3 to $12.7B, an improvement from Q2's 2.5% growth and Q1's 2.2% decline. Gartner is more conservative, estimating revenue only rose 1.7%.
- "IDC has seen increasing market influence from Greater China, hyperscale datacenters, ODMs and native Chinese OEMs, all of which grew sharply in the third quarter," says VP Matt Eastwood. Like others, IDC expects Intel's recent Grantley Xeon CPU launch, together with the pending end of Windows Server 2003 support, to keep demand healthy.
- Thanks to weak demand for its high-end, Itanium-based, Integrity servers, market leader H-P's (NYSE:HPQ) share fell 140 bps Y/Y to 26.5%, after having risen 40 bps in Q2. H-P just rolled out Integrity servers running (x86-based) Intel Xeon CPUs in an attempt to stop the bleeding.
- #2 IBM's share fell 500 bps to 18.2%, thanks to both high-end (mainframe/Power) and x86 weakness. The sale of IBM's x86 server unit to Lenovo closed early in Q4. #3 Dell's share rose 80 bps to 17.8%.
- Cisco (NASDAQ:CSCO) passed Oracle (NYSE:ORCL) to take the #4 slot: Cisco's share rose 130 bps to 6.2% on the back of 31% revenue growth, while Oracle's was flat at 4.1% (3.4% revenue growth). Today, Cisco and IBM announced a converged hardware solution that pairs the former's UCS servers with the latter's Storwize storage arrays.
- As expected, white-label servers sold to Internet giants (called ODM Direct by IDC) continued gaining ground: Their share rose 250 bps to 8.9%. Everyone else saw their share collectively rise 210 bps to 18.4%.
- Related tickers: SMCI, MLNX, QLGC, ELX
Dec. 2, 2014, 10:40 AM
- Mellanox (NASDAQ:MLNX) is about to see "18-24 months of tailwinds in the interconnect space driven by strength in the HPC industry, the Grantley server refresh cycle, data center and storage spending trends, strength in the 40G market and the eventual move towards 100G," predicts Barclays, upgrading the InfiniBand adapter/switch leader to Overweight.
- Barclays does think interconnect competition will intensify - the Street has already been on edge over Intel's plans to encroach on Mellanox's turf - but nonetheless thinks Mellanox can maintain a strong high-end position.
- Though still well below its 2012 highs, Mellanox is now up 44% from a June low of $30.58. Growing non-HPC sales and a strong early reception for Intel's Grantley Xeon CPUs has helped its cause.
Nov. 17, 2014, 7:07 PM
- Intel (NASDAQ:INTC) has officially launched its MICA smart bracelet (previous). The device is priced at $495, and aimed at women. It features a 1.6" OLED display, and delivers texts, e-mails, and Facebook/Google notifications over AT&T's 3G network. Two years of free data is bundled.
- Much like Qualcomm wth its Toq smartwatch, it doesn't look as if Intel's goal is to challenge Apple and Samsung's wearables, but to provide a proof-of-concept for OEMs looking to create similar hardware running on Intel processors. Intel began shipping its low-power Quark CPUs this year, and has also developed Atom CPUs meant for embedded devices.
- Meanwhile, Intel has shared more details Knights Landing, an upcoming 14nm product for its Xeon Phi co-processor line (used in HPC/supercomputer systems), and added Knights Hill, a successor product that will use a 10nm process, to its roadmap.
- Knights Landing, which succeeds the current Knights Corner in 2H15, is said to deliver a 3x improvement in single-thread performance. It includes up to 16GB of memory, can work either as a co-processor or a standalone processor, and relies on a new interconnect fabric (called Omni-Path) that Intel promises will deliver better performance and require fewer switches than the widely-used InfiniBand - that makes it a potential challenge for Mellanox (NASDAQ:MLNX).
- The product takes aim at Nvidia's (NASDAQ:NVDA) leading position in the HPC co-processor market. Today, Nvidia unveiled the Tesla K80, a high-end HPC co-processor said to deliver 8.7 teraflops of single-precision throughput (74% above the prior-gen K40). The K80 sells for $5,000, and contains two of Nvidia's new (28nm) GK210 GPUs.
Nov. 14, 2014, 11:34 AM
- The Department of Energy has awarded $325M in contracts to IBM (IBM +0.6%) to create two GPU-accelerated supercomputers declared to be at least 3x more powerful than any existing system.
- The systems will rely on IBM's Power CPUs, Nvidia's (NVDA +0.5%) Tesla GPUs and NVlink GPU interconnects, and Mellanox's (MLNX +2.1%) 100Gb/s InfiniBand interconnects. Installation is expected in 2017.
- IBM asserts the systems will lower energy consumption by limiting data movement. The deal acts as a nice reference win for Power - Big Blue is trying to stem Power's share losses to Intel's Xeon CPUs by selling to 3rd-party server OEMs and licensing the architecture to other chip developers. Its powerful Power8 CPU (12 cores supporting 96 simultaneous threads) began shipping earlier this year.
- Separately, the DOE says it will invest $100M in FastForward2, an R&D program to create more powerful/energy-efficient supercomputers. IBM, Nvidia, Intel, AMD, and supercomputer maker Cray (CRAY +0.1%) are among the companies taking part.
- PRs: IBM, Nvidia, Mellanox
Nov. 12, 2014, 9:37 AM
- Mellanox (NASDAQ:MLNX) "has determined that [its] accounting for charitable contributions and certain purchase orders in prior periods needs to be revised," and is delaying its Q3 10-Q filing as a result.
- Though management has concluded "the Company’s previously-issued quarterly and annual financial statements were not materially misstated," the cumulative amount would be material to 2014 results if recorded in full during Q3.
- Moreover, Mellanox thinks "these matters are indicative of material weaknesses in the Company’s internal control over financial reporting." It plans to revise its 2011-2013 financial statements.
Nov. 12, 2014, 9:18 AM
Oct. 24, 2014, 5:37 PM
Oct. 22, 2014, 4:41 PM
- Mellanox (NASDAQ:MLNX) expects Q4 revenue of $133M-$137M, above a $129.3M consensus.
- Q3 results beat estimates on the back of strong InfiniBand hardware demand for HPC deployments (boosted by Intel's Grantley Xeon CPU launch), as well as higher Ethernet product sales. Mellanox expects rising shipments of 40G Ethernet adapters (carrying higher ASPs than 10G adapters) to Web/cloud clients to provide a Q4 lift.
- Gross margin rose 110 bps Y/Y to 70.2%. GAAP opex rose 13.5% Y/Y to $82.3M. GM is expected to be in a 69%-70% range in Q4.
- MLNX +2.7% AH. Q3 results, PR.
Oct. 22, 2014, 4:11 PM
Oct. 21, 2014, 5:35 PM
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Oct. 14, 2014, 6:07 PM
- Intel's (NASDAQ:INTC) Data Center Group saw broad-based strength in Q3, CEO Brian Krzanich noted on the CC. Enterprise sales rose 11%, networking 16%, HPC 22% (good for MLNX), and cloud 34%.
- He added Intel's new Grantley Xeon CPUs are seeing strong uptake, and that the chip giant now has 35 custom Xeon SKUs for various clients. Facebook, eBay, Microsoft, and other Web giants have been avid buyers of custom Intel server CPUs.
- 15M tablet CPUs were shipped in Q3; Intel still expects 40M in 2014. The company promises a "substantial improvement" in mobile chip profitability next year as contra revenue payments drop, but doesn't expect the segment to turn profitable.
- Aside from a stabilizing market, Intel thinks PC division sales benefited from share gains (no doubt against AMD) and higher inventories (they were depressed a year ago). A couple of analysts pressed Intel on inventories; the company insists customers have an "appropriate amount." A mix shift towards Bay Trail Atom CPUs pressured ASPs.
- On CNBC (video), CFO Stacy Smith noted developed markets are still faring better than emerging markets, and argued Microchip (responsible for the warning heard round the chip world) "[plays] in different segments." Linear Technology, which has more customer overlap with Microchip, just missed estimates and issued light guidance.
- INTC +2.7% AH. AMD +1.2%. MU +1.8%.
- Q3 results, details.
Sep. 30, 2014, 9:13 AM
- Believing the company is "well-positioned to capitalize" on a server upgrade cycle fueled by Intel's Grantley Xeon CPUs (launched earlier in September), Piper's Andrew Nowinski has upgraded Mellanox (NASDAQ:MLNX) to Overweight, and hiked his target by $10 to $50.
- Nowinski sees Grantley boosting Mellanox's sales and earnings growth for the next 4-6 quarters. He also points out shares have fallen 11% since July 2013 (when Piper downgraded them), while the Nasdaq is up 25%.
- Mellanox's management has already forecast Grantley will boost the company's HPC-related sales (roughly half of its revenue).
Aug. 27, 2014, 7:21 PM
- IDC estimates global server sales rose 2.5% Y/Y in Q2 to $12.6B. That marks a turnaround from the 2.2% drop seen in Q1, and the 4.4% drop seen in Q4. Gartner estimates sales grew 2.8%.
- IDC declares the server market, hurt in recent quarters by system consolidation and a shift in demand towards the white-label gear beloved by Web giants (referred to by IDC as ODM Direct), is seeing "the beginning of a cyclical refresh cycle." It sees the pending launch of Intel's (NASDAQ:INTC) Grantley Xeon CPUs, along with Microsoft's plans to end Windows Server 2003 support, lifting sales into 2015.
- Sales of x86 servers (mostly Intel-based) rose 7.8% in Q2, and now make up 78% of industry revenue. Non-x86 server sales fell 12.8%.
- Market leader H-P's (NYSE:HPQ) share rose 40 bps Y/Y to 25.4%, with x86 growth offsetting Itanium weakness. #2 IBM's share fell 340 bps to 23.6% ahead of the sale of its x86 server ops to Lenovo; on the bright side, IBM's decline narrowed from Q1's 600 bps.
- #3 Dell's share fell 160 bps to 16.2%. #4 Oracle's (NYSE:ORCL) grew 10 bps to 5.9%, with engineered system growth offsetting declines for older UNIX/SPARC server lines. #5 Cisco (NASDAQ:CSCO), which recently proclaimed its UCS server ops are on a $3B/year run rate, saw its share rise 140 bps to 5.8% on the back of 35% growth. Cisco should pass Oracle in a quarter or two.
- ODM Direct vendors saw their share grow 110 bps to 6.6%. The shares of all other vendors rose 190 bps to 16.1%.
- Related tickers: SMCI, MLNX, QLGC, ELX
Mellanox Technologies Ltd designs, manufactures and sells interconnect products and solutions that facilitate data transmission between servers, storage systems and communications infrastructure equipment and other embedded systems.
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