Fri, Jul. 31, 12:46 PM
Fri, Jul. 31, 10:18 AM
- Though officially missing consensus, QLogic's (NASDAQ:QLGC) FQ1 revenue ($113.4M) was slightly above the guidance ($113M) provided in its July 9 warning. Cost cuts EPS ($0.19) top guidance ($0.16-$0.17).
- However, on its earnings call (transcript), the Fibre Channel/Ethernet connectivity hardware vendor guided for FQ2 revenue of $98M-$106M and EPS of $0.10-$0.16, well below a consensus of $127.1M and $0.23.
- QLogic notes it saw weak demand from several Fibre Channel server and storage OEM customers in FQ1 due to "weaker-than-expected traditional enterprise server and storage system shipments." Cloud storage demand has been weighing on traditional enterprise sales - QLogic plans direct more resources towards cloud opportunities.
- The company also forecasts Ethernet revenue will drop Q/Q in FQ2 thank to a $3M-$4M inventory buildup at a major OEM, and the $3M impact of a transition at an OEM from Ethernet ASICs to adapters. The transition to adapters (higher ASPs) is expected to boost sales in the second half of FY16.
- In response to the top-line pressures, QLogic is planning a restructuring that aims to lower the company's FY16 (ends March '16) operating expenses to $200M. $52.3M was spent on opex in FQ1, below prior guidance of $55M-$56M and down 9% Y/Y.
- BMO, D.A. Davidson, and Summit Research have downgraded. BMO's Keith Bachman: "[W]e have concerns that the growth of x86 servers will remain weak with enterprises and (more importantly) attach rates of [10G Ethernet] will continue to be slow to ramp." He respectively forecasts Fibre Channel and Ethernet revenue will drop 9% and 26% in FY16.
Thu, Jul. 9, 12:50 PM
Thu, Jul. 9, 9:18 AM
Thu, Jul. 9, 9:12 AM
- QLogic (NASDAQ:QLGC) now expects to report FQ1 revenue of $113M and EPS of $0.16-$0.17, well below prior guidance of $124M-$132M and $0.23-$0.27, and a consensus of $128.3M and $0.25.
- The Fibre Channel/Ethernet connectivity hardware vendor blames "lower than expected demand due to general weakness in the Company's traditional enterprise server and storage markets, and a build-up of inventory at certain of its OEM customers due to a slower next-generation server transition in enterprise environments." Back in April, QLogic blamed top-line weakness it was seeing on the delayed qualification by enterprises of servers running Intel's Grantley Xeon CPUs.
- Shares have fallen to $11.60 premarket. Full FQ1 results arrive on July 30.
Wed, May 6, 9:53 AM
- Argus Financial has upgraded QLogic (NASDAQ:QLGC) to Buy, and set a $19 target.
- The upgrade 6 days after the Fibre Channel/Ethernet connectivity hardware maker posted mixed FQ4 results (EPS beat, sales missed) and guided for FQ1 revenue of $128M (+/- 3%) and EPS of $0.23-$0.27 vs. a pre-earnings consensus of $133.3M and $0.25.
- On its CC (transcript), QLogic blamed the sales weakness on the delayed qualification of servers based on Intel's Grantley Xeon CPUs (previous) among enterprises, while stating it's "very optimistic that the Grantley ramp will accelerate in the second half of FY '16."
Wed, Apr. 15, 2:32 PM
- InfiniBand and Ethernet adapter/switch/controller vendor Mellanox (MLNX +4.8%) is up strongly after Intel reported 19% Y/Y server CPU division growth. Fibre Channel and Ethernet adapter/switch/controller vendor QLogic (QLGC +2.4%) is also having a good day.
- On its CC (transcript), Intel (NASDAQ:INTC) stated its Grantley Xeon E5 CPUs (launched last September, used in HPC deployments featuring Mellanox hardware) now account for over half of its 2-socket server CPU volume. Not surprisingly, the company also reported seeing strong cloud and telco server CPU demand.
- Mellanox reports on April 21. QLogic hasn't set a calendar Q1 earnings date yet.
Wed, Feb. 25, 4:48 PM
- In tandem with its FQ1 results, Avago (NASDAQ:AVGO) announces it's buying Fibre Channel/Ethernet connectivity hardware maker Emulex (NYSE:ELX) for $609M net of cash and debt, or $8/share. The price represents a 26% premium to Emulex's Wednesday close.
- The deal is expected to be funded with cash on hand, and to close in the second half of Avago's FY15 (ends Nov. 1). It's expected to be immediately accretive.
- Avago is less than a year removed from buying LSI, whose product line includes RAID storage controllers, storage adapter cards, hard drive SoCs, and network processors. Much of Emulex's product line, which includes Fibre Channel and Ethernet adapter cards, Ethernet and storage controllers, and network monitoring hardware, is complementary to LSI's and/or services the same hardware OEMs.
- Avago is up 5.3% AH to $118.64 following the acquisition news, its FQ1 EPS beat, and strong FQ2 revenue guidance. Emulex is up 24.8% to $7.94. Emulex archrival QLogic (NASDAQ:QLGC) is up 4% to $15.16.
Fri, Jan. 30, 10:22 AM
- QLogic (QLGC +4.8%) has jumped to new 52-week highs after beating FQ3 estimates and issuing strong FQ4 guidance on its CC: Revenue of $132M-$138M and EPS of $0.24-$0.28 vs. a consensus of $133.1M and $0.25 (transcript).
- Archrival Emulex (ELX -8.1%), however, is off sharply after providing in-line FQ3 guidance - revenue of $97M-$103M and EPS of $0.11-$0.15 vs. a consensus of $100.1M and $0.13 - to go with an FQ2 beat.
- QLogic CEO Prasad Rmapalli asserts his company has been gaining share in the Fibre Channel adapter card market (59% estimated revenue share over the first three quarters of calendar 2014), and has seen "significant share gains" in the high-end 16G Gen 5 segment.
- He added strong Q/Q growth was seen for QLogic's 10G Ethernet adapters and ASICs - the company bought Broadcom's Ethernet controller business a year ago - aided by major design wins for servers running Intel's recently-launched Grantley Xeon CPUs. 25G Ethernet adoption is forecast to be "a disruptive force in the Ethernet ecosystem."
- Likely hurting Emulex: CFO Kyle Wescoat stated on the CC (transcript) "sequential [FQ3] growth in our Ethernet products is offset by Fibre Channel seasonality that could be more pronounced than usual, given the stronger-than-expected December quarter performance."
- A BMO analyst pressed Emulex about its 10G Ethernet share during the Grantley server cycle, and an RBC analyst asked if IBM's recent woes are hurting the company. CEO Jeff Benck declared Emulex is confident it can gain share during the Grantley cycle, and noted a weak UNIX server market (where IBM is a major player) can have an impact.
Fri, Jan. 30, 9:12 AM
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. 17, 2014, 11:44 AM
- Five months after upgrading QLogic (NASDAQ:QLGC) to Equalweight, Morgan Stanley has upped its rating for the adapter card/switch vendor to Overweight. Archrival Emulex (NYSE:ELX) is catching a sympathy bid.
- MS also hiked its server industry growth forecast today, thanks in part to a belief Microsoft's ending of Windows Server 2003 support (set for July 2015) will drive strong upgrade activity. IDC, which recently estimated server industry revenue rose 4.8% Y/Y in Q3, holds a similar view.
Oct. 17, 2014, 12:52 PM
Oct. 16, 2014, 5:37 PM
Oct. 16, 2014, 5:07 PM
- QLogic (NASDAQ:QLGC) has launched a $100M buyback, good for repurchasing 11% of shares at current levels.
- FQ2 results beat estimates thanks to both 5%+ Q/Q growth for QLogic's Fibre Channel ops (struggling in recent quarters), and a $5M increase for an Ethernet business expanded earlier this year through the purchase of Broadcom's Ethernet controller ops.
- Altogether, sales of "advanced connectivity platforms" (server/storage adapters and chips) rose 22% Y/Y, an improvement from FQ1's 14% growth and offsetting an ongoing decline in legacy switch products.
- Emulex (NYSE:ELX) could follow QLogic higher. Its shares jumped yesterday following an FQ1 guidance hike.
- FQ2 results, PR
Oct. 16, 2014, 4:32 PM
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