QLogic: Fiscal 4Q10 Financial Results

QLogic Corp. announced its financial results for the fourth quarter and fiscal year ended March 28, 2010.

Fourth Quarter Highlights

• Net revenue: $145.7 million.
• GAAP net loss: $4.8 million or $0.04 per diluted share.
• Non-GAAP net income: $32.4 million or $0.28 per diluted share.
• Cash generated from operations: $69.3 million.
• Cash and investment securities: $375.7 million as of March 28, 2010.

Fiscal Year Highlights

• Net revenue: $549.1 million.
• GAAP net income: $54.9 million or $0.47 per diluted share.
• Non-GAAP net income: $117.7 million or $1.00 per diluted share.
• Cash generated from operations: $161.8 million.

Financial Results
Net revenue for the fourth quarter of fiscal 2010 was $145.7 million and increased 12% from $130.5 million in the same quarter last year. Revenue from Host Products was $103.7 million during the fourth quarter of fiscal 2010 and increased 17% from $88.4 million in the same quarter last year. Revenue from Network Products was $22.6 million during the fourth quarter of fiscal 2010 compared to $25.1 million in the same quarter last year. Revenue from Silicon Products was $16.7 million during the fourth quarter of fiscal 2010 compared to $13.7 million in the same quarter last year.

Net loss on a GAAP basis for the fourth quarter of fiscal 2010 was $4.8 million, or $0.04 per diluted share, compared to net income of $19.2 million, or $0.16 per diluted share, for the fourth quarter of fiscal 2009. Net loss on a GAAP basis for the fourth quarter of fiscal 2010 included a special tax charge of $29.7 million described below. Net income on a non-GAAP basis for the fourth quarter of fiscal 2010 was $32.4 million, or $0.28 per diluted share, and increased from $24.5 million, or $0.20 per diluted share, for the fourth quarter of fiscal 2009.

Approximately five years ago, the Company implemented a globalization initiative to expand its worldwide footprint. As part of this initiative, certain intellectual property and other rights were licensed to an international subsidiary of the Company. The special tax charge of $29.7 million recorded in the fourth quarter of fiscal 2010 was primarily related to an amendment of the license agreement with this international subsidiary which resulted in a fully paid-up license.

Net revenue for fiscal 2010 was $549.1 million compared to $633.9 million in fiscal 2009. Net income on a GAAP basis for fiscal 2010 was $54.9 million, or $0.47 per diluted share, compared to $108.8 million, or $0.85 per diluted share for fiscal 2009. Non-GAAP net income for fiscal 2010 was $117.7 million, or $1.00 per diluted share, compared to $154.2 million, or $1.20 per diluted share for fiscal 2009.

“Despite a very challenging macroeconomic environment, we delivered solid financial performance during the fourth quarter and full fiscal year,” said H. K. Desai, chief executive officer, QLogic. “This performance was attributable to continued share gains within our traditional markets, the introduction and ramp of innovative new products that provide us incremental business opportunities in the converged networking and 10Gb Ethernet markets, and extremely careful operating expense management.”