Tue, Apr. 21, 9:36 AM
- In tandem with its Q1 report, Mellanox (MLNX +1.2%) announces COO Shai Cohen and engineering SVP Roni Ashuri (both co-founders) "have indicated their intentions to retire to spend more time with their families." They'll remain with the company into Q4 to ensure an orderly transition.
- Q2 guidance is for revenue of $155M-$160M, soundly above a $149.3M consensus. Strong numbers were expected after Intel reported 19% Y/Y server CPU division growth last week on the back of strong Grantley Xeon CPU sales and demand from cloud/telco clients (Mellanox rallied in response).
- Discussing Q1, Mellanox notes the 40G Ethernet transition at major customers helped drive its top-line growth, and since its overall Ethernet share grew. The company's mainstay InfiniBand offerings say 46% Y/Y growth.
- Perhaps looking to counter fears of Intel competition, CEO Eyal Waldman asserts Mellanox is "the only company shipping full end-to-end 100 Gigabit [Ethernet and InfiniBand] solutions," that its 100G offerings deliver superior performance, and that its 40G Ethernet switches "were found to have zero packet loss and lower latency compared with competitive products."
- Contributing to the EPS beat: Gross margin rose to 73.4% from 72.3% in Q4 and 68.8% a year ago; Q2 GM guidance is at 71%-72%. Operating expenses (non-GAAP) rose 23% Y/Y to $77.4M (compares with 48% rev. growth). Mellanox ended Q1 with $432.7M in cash/investments, and no debt (compares with a $2.2B market cap).
- Q1 results, PR
Tue, Apr. 21, 7:06 AM| Comment!
Mon, Apr. 20, 5:30 PM
Wed, Jan. 28, 5:26 PM
- With Intel's Grantley Xeon server CPU launch providing a big tailwind, Mellanox (NASDAQ:MLNX) expects Q1 revenue of $140M-$145M, above a $135.4M consensus.
- CEO Eyal Waldman declares the Q4 beat was fueled by 40G Ethernet adoption by major clients, growing HPC deployments (boosted by share gains), and "additional penetration into Web 2.0, storage and cloud markets." Mellanox's 100G InfiniBand offerings are expected to see initial deployments in Q1, as are its 25/50/100G Ethernet adapters and cables.
- Gross margin rose 300 bps Y/Y in Q4 to 72.3%; it's expected to be at 70%-71% in Q1. Opex rose 14% to $73M.
- Mellanox ended Q4 with $389M in cash/investments, and no debt. Jefferies' downgrade wasn't timed well.
- Q4 results, PR
Wed, Jan. 28, 4:09 PM| Comment!
Tue, Jan. 27, 5:35 PM| 4 Comments
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%.
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| Comment!
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.
Jul. 25, 2014, 9:53 AM
- Though Q2 revenue was only in-line, Mellanox (NASDAQ:MLNX) guided on its CC (transcript) for Q3 revenue of $114M-$118M, largely above a $114.4M consensus.
- CEO Eyal Waldman states Mellanox expects 2H14 growth from both its core HPC market (still half of revenue), and from storage and Web/cloud use cases. Design wins for EMC's new VMAX3 high-end storage systems - they use a 56-gig Mellanox InfiniBand interconnect - will help with storage growth.
- As expected, Mellanox expects the 2H launch of Intel's Grantley Xeon CPU to boost HPC-related demand; other Intel efforts still pose a long-term threat, but Mellanox doesn't expect an impact before 2016. It's also upbeat about the launch of 100-gig InfiniBand switches and adapter cards.
- IBM was the only 10%+ customer in Q2, accounting for 11% of revenue. 56-gig InfiniBand products made up 50% of revenue, 40-gig InfiniBand 15% of revenue, and Ethernet 19% of revenue. Mellanox is counting on the Integrity Project acquisition to strengthen its position in an Ethernet market where its share is still limited.
Jul. 24, 2014, 4:15 PM
Jul. 23, 2014, 5:35 PM
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May. 1, 2014, 11:14 AM
- On top of missing FQ3 sales estimates (while hitting EPS forecasts), Emulex (ELX -24.7%) is guiding for FQ4 revenue of $94M-$100M and EPS of $0.00-$0.05, well below a consensus of $115.7M and $0.18.
- Storage adapter card/controller/switch archrival QLogic (QLGC -6.1%), which reports after the close, is off in sympathy, as is storage switch leader Brocade (BRCD -2.4%). Mellanox (MLNX -1.7%), which competes against Emulex in the 10G Ethernet adapter space, is also declining; its shares already tumbled last week due to a Q1 miss and soft guidance.
- On its CC (transcript), Emulex mentioned its network connectivity product sales (71% of revenue, dominated by Fibre Channel storage offerings) fell 9% Y/Y, as Fibre Channel weakness more than offset 10G Ethernet growth. The FC issues are blamed on UNIX server weakness (sales have been in freefall for a while) and "specific issues" with an x86 server OEM (likely IBM).
- Moreover, in remarks with clear implications for QLogic/Brocade, Emulex says it now expects a "higher rate of secular decline in the Fibre Channel business than previously anticipated." Its own FC sales are now expected to fall at a high-single to low-double digit Y/Y clip vs. prior guidance for a mid-single digit drop.
- Also, Emulex's network visibility product sales (Endace, 6% of revenue) came in below expectations, and its legacy storage connectivity/other business (23% of revenue) is expected to fall 10%-15% in FY14 and perhaps over 30% in FY15.
Apr. 24, 2014, 4:10 PM| Comment!
MLNX vs. ETF Alternatives
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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