NEWPORT BEACH, Calif.--(Mindspeed Technologies, Inc. (NASDAQ: MSPD), a leading supplier of semiconductor solutions for network infrastructure applications, today announced that it has raised its fiscal first quarter 2013 guidance previously provided on November 5, 2012.)--
“Importantly, we are also putting these gains to the bottom line and executing to the restructuring plan we laid out two quarters ago. Having completed a year of meaningful investment in our wireless growth initiative, we now anticipate significant earnings leverage and improved cash flow going forward in fiscal 2013.”
Mindspeed now forecasts product revenue in the range of $37.5 to $38.5 million, versus a prior range of $36.5 to $37.5 million. Mindspeed also projects non-GAAP product gross margins toward the higher end of its previous guidance range of 58-59%. Further, Mindspeed forecasts reaching non-GAAP operating profitability in the fiscal first quarter of 2013, one quarter ahead of the plan it laid out in the fiscal third quarter of 2012. These forecasts exclude the benefit of the $6.0 million sale of non-core intellectual property completed in the fiscal first quarter of 2013.
“We are seeing better than forecast demand across our product lines, leading to the upside versus our prior guidance. The rollout of our Transcede® SoC in the 4G/LTE small cell deployments in Korea is on target, while our wireline businesses are continuing their upward order trend,” commented Raouf Y. Halim, Mindspeed's chief executive officer. “Importantly, we are also putting these gains to the bottom line and executing to the restructuring plan we laid out two quarters ago. Having completed a year of meaningful investment in our wireless growth initiative, we now anticipate significant earnings leverage and improved cash flow going forward in fiscal 2013.”
About Mindspeed Technologies
Mindspeed Technologies (NASDAQ: MSPD) is a leading provider of network infrastructure semiconductor solutions to the communications industry. The company's low-power system-on-chip (SoC) products are helping to drive video, voice and data applications in worldwide fiber-optic networks and enable advanced processing for 3G and long-term evolution (LTE) mobile networks. The company's high-performance analog products are used in a variety of optical, enterprise, industrial and video transport systems. Mindspeed's products are sold to original equipment manufacturers (OEMs) around the globe.
We provide non-GAAP measures as a supplement to financial results based on GAAP. We believe the presentation of non-GAAP measures provides investors with additional insight into underlying operating results and prospects for the future. We have historically reported similar financial measures and believe that the inclusion of comparative numbers provides consistency in our financial reporting.
We use non-GAAP gross margin internally to evaluate our operating performance and to determine certain components of management compensation. In addition, we use non-GAAP gross margin for internal budgets and forecasts. We believe that non-GAAP gross margin can be useful to investors in allowing for greater transparency with respect to supplemental information used by management in its financial and operational decision making.
Non-GAAP gross margin excludes asset impairments, stock-based compensation and related payroll costs, profit in acquired inventory and amortization of acquired intangible assets. We exclude stock-based compensation and related payroll costs from non-GAAP gross margin because we believe that excluding these costs can enhance the understanding of our performance. We exclude profit in acquired inventory to facilitate comparability of gross profit between periods and to better reflect continuing operations of the acquired company. We exclude asset impairments because it includes discrete items that may not be indicative of our ongoing operations or economic performance.
We do not provide forward-looking GAAP gross margin or a reconciliation of forward-looking non-GAAP gross margin to GAAP gross margin because of our inability to project stock-based compensation and related payroll costs.
Safe Harbor Statement
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such statements include statements regarding our expectations, goals or intentions, including, but not limited to: improved product demand and associated increased revenues; deployments and our ability to benefit from them; the anticipated financial and operational impact of our recent restructuring plan; our ability and timeline to achieve operating profitability; and our earnings leverage and improved cash flow. These forward-looking statements are based on management's current expectations, estimates, forecasts and projections and are subject to risks and uncertainties that could cause actual results and events to differ materially from those stated in the forward-looking statements. For example, we cannot provide assurances that our recent restructuring plan will result in our achieving operating profitability and our current projections of future operating results are based, in part, on the anticipated financial impact of our acquisition of Picochip. In addition, our existing business is subject to numerous risks and uncertainties, including fluctuations in our operating results and future operating losses; loss of or diminished demand from one or more key distributors; our ability to successfully develop and introduce new products; pricing pressures; and the potential for intellectual property litigation. Additional risks and uncertainties that could cause our actual results to differ from those set forth in any forward-looking statements are discussed in more detail under the caption “Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended September 30, 2011, and will be included in our Annual Report on Form 10-K for the year ended September 28, 2012, as well as our future filings with the SEC.