Tuesday, April 25, 2006

NETGEAR Posts 17% Growth, Notes Component Shortage

NETGEAR reported Q1 revenue of $127.3 million, a 16.8% increase as compared to $109.0 million for the first quarter ended April 3, 2005, and an increase of 4.5% as compared to $121.8 million in the fourth quarter of 2005. Net income (GAAP) was $9.9 million or $0.29 per diluted share. This net income was a 25.3% increase compared to net income of $7.9 million for the first quarter of 2005 or $0.24 per diluted share, and $8.9 million or $0.26 per diluted share in the fourth quarter of 2005.

Non-GAAP gross margin in the first quarter of 2006 was 35.1%, as compared to 33.0% in the year ago comparable quarter, and 31.3% in the fourth quarter of 2005.

"Demand in the first quarter continued to be strong across all three regions, maintaining the momentum of the fourth quarter. Channel supply experienced continued constraints due to component shortages on our most popular products: RangeMax 240 in the U.S. and DSL2+ gateways in Europe and in Australia. We expect component shortages will last until the middle of the second quarter due to sustained high market demand levels," stated Patrick Lo, Chairman and CEO of NETGEAR.



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