Paul V. Walsh
Thank you, Tyson, and good morning. As Tyson mentioned, the revenue of $125.7 million exceeded our expectations, up 5% from the same period a year ago. First, I'd like to cover the GAAP results, which included approximately $6.7 million in non-cash stock compensation charges, or $7.9 million, excluding the reversal of prior stock compensation related to Necip Sayiner's separation agreement. The Q1 impact of the separation agreement included a net $1.2 million credit for stock comp and $300,000 cash component. The balance of the agreement will be recognized through Q3. We also recorded a $950,000 one-time credit related to purchase accounting from a prior acquisition.
First quarter GAAP gross margin was 59.7%. R&D investment of $32.9 million and SG&A expense of $25.4 million offset the gross margin decline and resulted in GAAP operating income of 13.3%, an improvement over the same period a year ago. The GAAP tax rate was 16.3%, resulting in GAAP earnings of $0.33, a 14% sequential increase and a 6-quarter high.
Turning to our non-GAAP results, going into the quarter, we had anticipated that Broadcast would be down seasonally, access will be about flat and Broad-based would be up. Given that mix profile, we expected gross margin to stay about flat. As near-term gross margin is largely a function of mix, better-than-expected Broadcast revenue brought gross margin down to 60%.Starting with Broadcast, as the quarter progressed, we saw significant strength in video, which was up by more than 15%. As a result, video largely offset the seasonal weakness in audio. And our broadcast products in total ended the quarter above flat versus the guide down. Access was down sequentially about 10% as phone equipment demand slowed somewhat, affecting our SLIC business. And modems into set-top boxes continued their anticipated decline. Set-top box modems represented between 3% and 4% of our total revenue in Q1. This has become a much less significant headwind, particularly given the potential for growth in modems as we gain share in multifunction printers.Read the rest of this transcript for free on seekingalpha.com
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