Voltaire: Fiscal 2Q08 Financial results

(in US$ millions)	2Q07	2Q08	6 mo. 07	6 mo. 08
Revenues	11.7	17.1	20.2	33.7
*Growth*		+46%		*+67%*
Net income (loss)	(1.5)	0.4	(4.5)	(1.7)

Voltaire Ltd. announced financial results for the three-month period ended June 30, 2008.

Second Quarter Highlights (compared to second quarter 2007)

Revenues up 46% reaching $17.1 million
Gross margin reaches record 54.5%, compared to 39.6% in second quarter 2007
Non-GAAP net income reaches $0.8 million; GAAP net income totals $0.4 million
Strong increase in order generation in financial services, manufacturing and life science vertical markets
Introduce third quarter revenue guidance of $17–$18 million; non-GAAP EPS $0.02 – $0.04

Revenues for the second quarter of 2008 totaled $17.1 million, an increase of 46% compared to $11.7 million in the second quarter 2007.

Gross profit for the second quarter of 2008 totaled $9.3 million, an increase of 101% compared to $4.6 million in the second quarter 2007. Gross profit, as a percent of revenues, for the second quarter of 2008, totaled 54.5%, a substantial increase from the 39.6% gross profit, as a percent of revenues, for the second quarter 2007.

Operating profit for the second quarter of 2008 totaled $0.3 million, an improvement from the GAAP operating loss of $1.3 million in the second quarter of 2007. Net profit for the second quarter of 2008 totaled $0.4 million, or $0.02 per diluted share, compared to a net loss, after non-cash accretion of redeemable preferred shares, of $6.8 million, or $9.79 loss per diluted share, in the second quarter of 2007.

Operating profit, on a non-GAAP basis, for the second quarter of 2008 totaled $0.7 million, a substantial increase compared to the non-GAAP operating loss of $1.0 million in the second quarter of 2007.

Net income, on a non-GAAP basis, for the second quarter of 2008 totaled $0.8 million, or $0.04 per diluted share, compared to a non-GAAP net loss of $1.0 million, or $0.07 loss per diluted share, in the second quarter 2007.

“This quarter our three pronged growth strategy comprised of our vertical market approach, OEM partnerships and leading and differentiated products contributed to our strong business and financial performance. We continued to see demand from our main commercial verticals with orders from the financial services vertical doubling over the previous quarter adding more than 10 new customers, closely followed by strong order growth in both the manufacturing and life science verticals,” said Ronnie Kenneth, Chairman and CEO of Voltaire.

“In terms of financial performance, we continue to execute, presenting once again healthy year over year growth in all our financial parameters. Since going public just over a year ago, we have showed steady growth and execution by presenting strong quarterly financial results that are clearly in line with our defined long term targets,” added Mr. Kenneth.

Outlook
Revenues for the third quarter of 2008 are expected to be in the range of $17 – $18 million, with revenues for the nine months of 2008 expected to be in the range of $50.7 – $51.7 million, an increase of 43% over the nine months 2007. Earnings per share, on a non-GAAP basis, in the third quarter 2008 expected to be in the range of $0.02 to $0.04 per share. Revenues in the second half of the year are expected to be seasonally stronger than the first half of the year.