Tuesday, February 7, 2012

Opnext's Revenue Falls 38% Due to Thai Flood

Opnext reported quarterly revenue of $53.1 million, down 38.3 percent sequentially and down 45.3 percent compared to the same quarter a year earlier, primarily due to the loss of production capacity at Fabrinet, Opnext's contract manufacturer in Thailand, following the flooding in October 2011.

Revenue from sales of 10Gbps and below products decreased 42% compared to the quarter ended September 30, 2011 due to the flooding in Thailand. Revenue from sales of 40Gbps and above products decreased 37% compared to the quarter ended September 30, 2011 due to lower sales of 40Gbps and 100Gbps client-side modules.

Cisco Systems, Inc. and Hitachi, Ltd. each represented 10% or more of total revenue for the quarter ended December 31, 2011 and combined represented 43% of total revenue. Gross margin of 3.8% was down 16.3 percentage points sequentially and down 16.2 percentage points compared to the quarter ended December 31, 2010.

"I am very pleased with the progress we made in the flood recovery process this quarter," said Harry Bosco, Chairman and Chief Executive Officer of Opnext. "During the quarter, we started limited assembly and testing of our 10G modules at our facilities in Japan and California and we plan to restart manufacturing in Thailand at Fabrinet's Pinehurst campus this month, with a return to pre-flood production capacity expected by March 31, 2012."

"As expected, due to the disruption caused by the flooding, our 10G and below revenues were down significantly in the December quarter. Our 40G and above revenues were also down as orders were impacted by the timing of next-generation 40G and 100G system deployments," added Mr. Bosco. "Based on our 10G production recovery plan and the improvement to date in orders for 40G and above products, we expect total revenue for the March 2012 quarter will be between $70.0 million and $75.0 million," concluded Mr. Bosco.