Tuesday, March 24, 2009

Conexant to Focus on Imaging, Audio/Video and Embedded-Modems

Conexant Systems reported quarterly revenue of $74.5 million. Core gross margins were 52.7 percent of revenues. Core operating expenses were $41 million, and core operating loss was $1.8 million. Core net loss from continuing operations was $7.4 million, or $0.15 per share. On a GAAP basis, gross margins were 52.5 percent of revenues. GAAP operating expenses were $48.4 million. GAAP operating loss was $9.3 million, and GAAP net loss from continuing operations was $14.8 million, or $0.30 per share.

"The Conexant team delivered performance that met or exceeded our expectations on all major financial metrics for the second fiscal quarter," said Scott Mercer, Conexant's chairman and chief executive officer. "Revenues of $74.5 million exceeded the high end of the range we provided in January. Gross margin of 52.7 percent was within the range we expected, and core operating expenses of $41 million were a million dollars lower than we anticipated entering the quarter due to our continued focus on cost-reduction activities. On a core operating basis, our loss of $1.8 million was lower than our expectation of a core operating loss in a range between $3 million and $7 million, resulting in a core net loss of $0.15 per share rather than the $0.18 to $0.26 per share we anticipated."

Regarding its recently announced plans to sell its Broadband Access product lines to Ikanos Communications for $54 million, Conexant said the deal will provide it with the flexibility needed to focus on solutions for imaging, audio, video, and embedded-modem applications.

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