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Finisar's CEO Discusses F1Q 2013 Results - Earnings Call Transcript

I would like to point out that we have prepared some slides for today’s earnings call, which you can access by connecting to the Investor Relations page of our website at www.finisar.com. Click on “Investors” then scroll down to “Webcast Archives” and click on it, and then you’ll see a listing for today’s F1Q 2013 Earnings Call.

As expected, our F1Q 2013 was challenging. Our revenues were $220.5 million, consistent with our prior guidance. The decline from the prior quarter’s revenues of $239.9 million was primarily the result of sluggish macroeconomic conditions, especially in Europe, as well as the slowing of economic growth in China. Generally, telecom spending throughout the world has been soft. In addition, we had two fewer shipping days in F1Q than in the previous quarter.

Non-GAAP gross margin of 30.3% was also consistent with our prior guidance. We held operating expenses for the quarter relatively flat, resulting in earnings per diluted share of $0.12. And now with that I’ll let Kurt review the rest of the numbers. Kurt?

Kurt Adzema

Thanks, Jerry. For F1Q our revenue was of $220.5 million, a decrease of $19.4 million or 8.1% from $239.9 million in the preceding quarter. Revenue for products from data communications was $139.5 million, a decrease of $6.5 million or 4.5% from the prior quarter, primarily as the result of the impact of two fewer shipping days in F1Q than in the previous quarter. Revenue for telecommunication products was $81 million, a decrease of $12.8 million or 13.6% from the prior quarter, primarily as a result of soft telecom spending throughout the world.

In F1Q we had one 10% or greater customer. Our top ten customers represented 62.1% compared to 58.5% in the preceding quarter. Non-GAAP gross margin was 30.3% compared to 31.4% in the preceding quarter primarily due to lower revenue levels. Non-GAAP operating expenses for F1Q were relatively flat at $54.7 million compared to $54.6 million in the preceding quarter. F1Q non-GAAP operating income decreased $8.9 million to $12 million or 5.4% of revenues compared to $20.9 million or 8.7% of revenues in the preceding quarter due primarily to lower revenue levels.

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