Mellanox Technologies, Ltd. (MLNX) - NASDAQ
  • Oct. 8, 2015, 8:35 PM
    • 11 months after announcing it plans to enter the ARM server CPU market, Qualcomm (NASDAQ:QCOM) says it has begun sampling to "tier-1 data centers" (possibilities include Amazon, Google, and Facebook) a development platform featuring a pre-production version of a 24-core CPU.
    • Details are limited for now, though Qualcomm does state it's using custom ARM cores, as it does for many Snapdragon mobile processors. It also promises an upcoming server CPU "will be competitive in performance and price with current and future Intel (NASDAQ:INTC) chips," and that it will arrive "sooner rather than later" (no specific ETA is provided).
    • AppliedMicro (NASDAQ:AMCC) and Cavium (NASDAQ:CAVM) are early leaders in the budding market for ARM server CPUs. Others in the space include AMD, Texas Instruments, and Marvell. Various Web/cloud service providers have shown interest in deploying the chips. But for now, they generally continue buying Intel Xeon CPUs by the thousands.
    • Also: Qualcomm is partnering with FPGA vendor Xilinx (NASDAQ:XLNX) to create systems that pair Qualcomm server CPUs with Xilinx FPGAs to provide workload acceleration. Intel is doing something similar with Xilinx archrival Altera, which it's in the process of acquiring.
    • A partnership has also been formed with InfiniBand/Ethernet connectivity hardware and chip developer Mellanox (NASDAQ:MLNX). Mellanox's 10-100G InfiniBand and Ethernet gear will be optimized for Qualcomm's CPUs.
    | Oct. 8, 2015, 8:35 PM | 29 Comments
  • Oct. 1, 2015, 9:16 AM
    • Mellanox (NASDAQ:MLNX) now expects Q3 revenue of $169M-$171M, improved from a prior $165M-$170M and above a $167.8M consensus.
    • Gross margin is expected to be "at the mid-point or better" relative to prior guidance; operating expenses are expected to be "toward the high end" of prior guidance. Full Q3 results arrive on Oct. 21.
    • Shares have risen to $38.91 premarket. They fell 5% yesterday after the EZchip deal was announced. Summit Research had voiced concerns about the fact guidance wasn't reiterated during the conference call held to discuss the deal.
    | Oct. 1, 2015, 9:16 AM
  • Sep. 30, 2015, 12:43 PM
    | Sep. 30, 2015, 12:43 PM | 10 Comments
  • Sep. 30, 2015, 10:25 AM
    • Mellanox (MLNX -7.3%) has sold off after announcing it's buying network processor (NPU) vendor and Israeli tech peer EZchip (EZCH +14.3%) for $811M in cash. Meanwhile, telecom/data center chipmakers Cavium (CAVM +3.5%), AppliedMicro (AMCC +4.1%), and PMC-Sierra (PMCS +7.9%) are rallying amid a 2% Nasdaq gain - each company's product line includes (but is by no means limited to) NPUs.
    • Whereas Mellanox is focused on high-speed data center connectivity hardware (e.g. adapter cards, switches, switching and adapter ICs), EZchip still gets the majority of its revenue from NPUs going into edge routers and other telecom hardware. However, the company has been trying to expand its data center footprint, via its new NPS processor line (supports deeper packet analysis) and its Tilera unit (acquired in 2014, set to launch a processor supporting 100 ARM cores).
    • Mellanox asserts EZchip's "products and expertise in security, deep packet inspection, video, and storage processing" will help it "deliver complete end-to-end, intelligent 10, 25, 40, 50, and 100Gb/s interconnect and processing solutions for advanced data center and [telecom] edge platforms." The purchase price is equal to 5.9x EZchip's 2016 sales consensus; Mellanox trades for just 2.3x 2016E sales.
    • Update: Summit Research's Srini Nandury thinks Mellanox's selloff stems from the company's failure to reiterate Q3 guidance during today's conference call, in spite of repeatedly being asked by analysts to do so.
    | Sep. 30, 2015, 10:25 AM
  • Sep. 30, 2015, 9:13 AM
    | Sep. 30, 2015, 9:13 AM
  • Sep. 30, 2015, 7:51 AM
    • The price works out to $25.50 per share in cash for EZchip (NASDAQ:EZCH) versus last night's close of $21.99.
    • "We expect our combined technologies, and product portfolios to deliver leading end-to-end intelligent interconnect and processing solutions to data centers and wide area networks," says Mellanox (NASDAQ:MLNX) CEO Eyal Waldman.
    • The deal is expected to close in Q1.
    • A conference call is set for 8:30 ET.
    | Sep. 30, 2015, 7:51 AM
  • Sep. 2, 2015, 3:07 PM
    • Editor's note: The Spectrum switch represents an attempt by Mellanox, still better-known to many for its InfiniBand offerings, to grow sales to cloud service providers and enterprises relying on high-speed Ethernet server connectivity. Notably, Mellanox is using a proprietary switching chip (also called Spectrum) said to provide 6.4Tbps of capacity - market leader Broadcom's Tomahawk switching chip tops out at 3.2Tbps - and claims to deliver better latency than rival offerings while eliminating packet loss.
    | Sep. 2, 2015, 3:07 PM
  • Aug. 17, 2015, 2:14 PM
    • In a weekend column, Bloomberg notes the use of home-grown switches by Web/cloud giants such as Facebook, Google, and Amazon spells an opportunity for network processor (NPU) vendors such as EZchip (NASDAQ:EZCH), and could help the company offset an expected decline in Cisco revenue due to Cisco's decision to use its own ASICs in next-gen edge router line cards.
    • EZchip, of course, isn't alone in going after the opportunity: Broadcom, Marvell, Intel, and Cavium are among the firms currently present in the data center NPU market. EZchip, which historically has depended on NPU sales for carrier equipment, is targeting data centers both via its NPS-400 processors (will begin sampling in Q4, recorded 5 tier-1 design wins in Q2), and via its Tilera unit's TILE-Mx family (supports up to 100 64-bit ARM cores, begins sampling in 2H16).
    • Shares are up 29% since EZchip delivered a Q2 beat and in-line guidance last Wednesday. Brean upgraded on Thursday.
    | Aug. 17, 2015, 2:14 PM
  • Aug. 13, 2015, 11:23 AM
    • Brean has upgraded EZchip (NASDAQ:EZCH) to Buy a day after the company post a Q2 beat and issued in-line Q3 guidance. Chardan Capital has hiked its target by $5 to $20. Shares are now up 18% over the last two days.
    • Meanwhile, Cisco (CSCO - expected to make up ~35% of EZchip 2015 revenue) reported yesterday afternoon its router sales rose 3% Y/Y in the July quarter. On the earnings call (transcript), CEO Chuck Robbins noted high-end carrier router sales were strong, and that Cisco needs to "probably improve our performance in our edge routing platforms."
    • EZchip's processors go into line cards for Cisco's ASR 9000 edge router line, but Cisco plans to use proprietary ASICs in next-gen edge router line cards. During EZchip's earnings call (transcript), CEO Eli Fruchter stated ~25% of EZchip's revenue is tied to the ASR 9000, and 10% to other Cisco products. "[W]e believe prior investor expectations for 35% to 40% of our revenues to be at risk due to the decision by Cisco for next generation line cards in its ASR9K platform, may be overstated."
    | Aug. 13, 2015, 11:23 AM
  • Aug. 12, 2015, 11:00 AM
    • In addition to beating Q2 estimates, EZchip (NASDAQ:EZCH) has guided on its earnings call for Q3 revenue of $30M-$31M, in-line with a $30.5M consensus. Many other chipmakers with strong telecom/networking exposure have issued below-consensus guidance (I, II).
    • Though (as previously announced) Cisco doesn't plan to use EZchip's NPS-400 network processor (NPU) in next-gen edge router line cards, the company is expected to account for ~35% of EZchip's 2015 revenue. The NPS-400 is set to begin sampling in Q4; 5 NPS-400 design wins were scored in Q2 with tier-1 OEMs.
    • CEO Eli Fruchter: "To the best of our knowledge, there is no NPU-based roadmap within other merchant silicon vendors. This could position EZchip to become the only high-end merchant NPU vendor in the market able to satisfy the growing demand from both traditional networking vendors as well as from new white box customers."
    • Gross margin was 76.7%, up from 74% in Q1 and down from 80.9% a year ago. $4.7M was spent on buybacks. EZchip ended Q2 with $189M in cash (equal to 33% of its current market cap), and no debt.
    • Q2 results, PR
    | Aug. 12, 2015, 11:00 AM
  • Aug. 12, 2015, 8:03 AM
    • EZchip Semiconductor (NASDAQ:EZCH): Q2 EPS of $0.34 beats by $0.08.
    • Revenue of $28.3M (+28.1% Y/Y) beats by $0.28M.
    | Aug. 12, 2015, 8:03 AM
  • Aug. 11, 2015, 5:30 PM
    | Aug. 11, 2015, 5:30 PM | 14 Comments
  • Jul. 23, 2015, 2:56 PM
    • Application delivery controller/security hardware vendor F5 (FFIV +6.9%) beat FQ3 estimates on the back of strong software sales, and provided above-consensus FQ4 EPS guidance (revenue was in-line). With growing 100G long-haul optical deployments serving as a tailwind, optical networking hardware vendor Infinera (INFN +9.6%) beat Q2 estimates and provided strong Q3 guidance.
    • Also: Optical component vendor Alliance Fiber (AFOP +16%) beat estimates and offered healthy guidance. Strong datacom component demand from cloud service providers was cited.
    • A slew of telecom/networking equipment, component, and chip vendors are higher on a day the Nasdaq is down 0.4%. The list includes Infinera rival Ciena (CIEN +1.6%), F5 rival Radware (RDWR +3.3%), and Alliance Fiber peer NeoPhotonics (NPTN +4.7%). Others include Ciena acquisition target Cyan (CYNI +1.8%) and chipmakers Cavium (CAVM +3.6%), PMC-Sierra (PMCS +3%), EZchip (EZCH +2.8%), and InPhi (IPHI +3.7%).
    • Broader gains for chip stocks - the Philadelphia Semi Index is up 1.7% after selling off hard yesterday - are likely helping the chipmakers. Cisco, meanwhile, is up 2.2% after striking a deal to sell its share-losing set-top unit to Technicolor.
    • During F5's earnings call, new CEO Manny Rivelo stated F5 now leads the virtual (software-based) ADC market, which has sometimes been seen as a major long-term threat to its ADC hardware business, and noted the company saw a 20% Y/Y increase in its deferred revenue balance (driven by services/subscription growth) to $743M. He also disclosed sales chief Dave Feringa is stepping down on Oct. 1; his successor will be named shortly.
    • On Infinera's call, CEO Tom Fallon mentioned the company has now invoiced 12 customers for its new Cloud Xpress data center interconnect platform, up from 7 three months ago. For now, long-haul optical still makes up over 90% of revenue - Cloud Xpress growth, the pending launch of a metro aggregation product, and (provided it's approved) the Transmode acquisition should change that. 3 customers accounted for over 10% of Q2 revenue.
    | Jul. 23, 2015, 2:56 PM
  • Jul. 22, 2015, 7:00 PM
    • Mellanox (NASDAQ:MLNX) expects Q3 revenue of $165M-$170M, above a $163M consensus. Gross margin is expected to slip to 71.5%-72.5% from Q2's 72.7% (-70 bps Q/Q and +340 bps Y/Y).
    • The company says it has begun shipping 100G interconnects, and now connects 51.4% of all systems on the TOP500 supercomputer list.
    • MLNX +1.1% AH to $47.50. Shares fell 2.4% in regular trading ahead of the Q2 report.
    • Q2 results, PR
    | Jul. 22, 2015, 7:00 PM
  • Jul. 22, 2015, 4:07 PM
    • Mellanox Technologies (NASDAQ:MLNX): Q2 EPS of $0.75 beats by $0.13.
    • Revenue of $163.34M (+59.2% Y/Y) beats by $5.51M.
    | Jul. 22, 2015, 4:07 PM
  • Jul. 21, 2015, 5:35 PM
Company Description
Mellanox Technologies Ltd. engages in the provision of semiconductor-based interconnect products that facilitate data transmission between servers, storage systems, communications infrastructure equipment, and other embedded systems. Its products include adapters, gateways, switches, integrated... More
Sector: Technology
Industry: Semiconductor - Broad Line
Country: United States