Marvell Fiscal 4Q10 Financial Results

Marvell Technology Group Ltd. reported financial results for the fourth quarter and fiscal year 2010, ended January 30, 2010.

Net revenue for the fourth quarter of fiscal 2010 was $843 million, a 64 percent increase from $513 million in the fourth quarter of fiscal 2009, ended January 31, 2009, and a 5 percent sequential increase from $803 million in the third quarter of fiscal 2010, ended October 31, 2009.  

Net revenue for the fiscal year ended January 30, 2010 was $2.81 billion, a decrease of 5 percent over reported net revenue of $2.95 billion for the fiscal year ended January 31, 2009.

GAAP net income was $205 million, or $0.31 per share (diluted), for the fourth quarter of fiscal 2010, compared with a GAAP net loss of $65 million, or $0.11 per share (diluted), for the fourth quarter of fiscal 2009. GAAP net income in the third quarter of fiscal 2010 was $202 million, or $0.31 per share (diluted).  

GAAP net income was $353 million, or $0.54 per share (diluted), for the year ended January 30, 2010, compared with a GAAP net income of $147 million, or $0.23 per share (diluted), for the year ended January 31, 2009.  

Non-GAAP net income increased to $266 million, or $0.40 per share (diluted), for the fourth quarter of fiscal 2010, as compared with non-GAAP net income of $32 million, or $0.05 per share (diluted), for the fourth quarter of fiscal 2009.  Non-GAAP net income for the third quarter of fiscal 2010 was $232 million, or $0.35 per share (diluted).  

For the fiscal year ended January 30, 2010, non-GAAP net income was $648 million, or $0.99 per share (diluted), as compared with non-GAAP net income of $482 million, or $0.76 per share (diluted), for the fiscal year ended January 31, 2009.  

"The results for our fourth quarter and fiscal year bring to a close one of the most challenging but successful years for Marvell," said Dr. Sehat Sutardja, Marvell’s Chairman and Chief Executive Officer. "I am very pleased with the progress we have made over the previous 12 months, in the face of a turbulent global economy. During the past year, we have transformed our organization to improve the efficiency of product development, we have refined our business model to deliver world-class financial performance and we have laid the groundwork to accelerate our growth in the coming years. While I am proud of the progress we have made, we continue to be mindful of the challenging economic environment we operate within and the effect macro-economic events could potentially have on our business.  Consequently, we will continue to focus on the aspects of our business we can control and influence. We believe it is important to aggressively invest in our employees and product development to allow Marvell to continue to deliver solutions that enable our customer’s success." 

GAAP gross margin for the fourth quarter of fiscal 2010 was 59.7 percent, compared to 50.7 percent for the fourth quarter of fiscal 2009, and 57.5 percent for the third quarter of fiscal 2010. GAAP gross margin for fiscal 2010 was 56.3 percent compared to 51.6 percent for fiscal 2009.

Non-GAAP gross margin for the fourth quarter of fiscal 2010 was 60.0 percent, compared to 51.3 percent for the fourth quarter of fiscal 2009 and 57.8 percent for the third quarter of fiscal 2010. Non-GAAP gross margin for fiscal 2010 was 56.7 percent compared to 52.0 percent for fiscal 2009.

Shares used to compute GAAP net income per diluted share for the fourth quarter of fiscal 2010 were 669 million shares, compared with 615 million shares in the fourth quarter of fiscal 2009 and 660 million shares in the third quarter of fiscal 2010.  Shares used to compute non-GAAP net income per diluted share for the fourth quarter of fiscal 2010 were 672 million shares compared with 629 million shares for the fourth quarter of fiscal 2009 and 664 million shares for the third quarter of fiscal 2010.  

Shares used to compute GAAP net income per diluted share for the fiscal year ended January 30, 2010 were 654 million shares, compared with 630 million shares used to compute GAAP net income per diluted share for the fiscal year ended January 31, 2009. Shares used to compute non-GAAP net income per diluted share for the fiscal year ended January 30, 2010 were 657 million shares compared with 630 million shares for the fiscal year ended January 31, 2009.

Cash flow from operations for the fourth quarter of fiscal 2010 was $281 million, up from the $109 million in the fourth quarter of fiscal 2009 and up from the $204 million reported in the third quarter of fiscal 2010. Cash flow from operations for fiscal 2010 was $812 million, compared to $681 million for fiscal 2009.  Free cash flow for the fourth quarter of fiscal 2010, was $253 million, up from the $93 million in the fourth quarter of fiscal 2009 and up from the $196 million reported in the third quarter of fiscal 2010. Free cash flow for fiscal 2010 was $756 million, compared to $602 million in fiscal 2009.  Free cash flow as presented above is defined as cash flow from operations, less capital expenditures and purchases of IP licenses.