Non-GAAP net loss for the fourth quarter of 2012 was ($1.5) million, or ($0.04) per share, compared with a non-GAAP net loss of ($2.7) million, or ($0.08) per share, for the third quarter of 2012 and a non-GAAP net loss of ($4.2) million, or ($0.14) per share, for the fourth quarter of 2011.
Further information about non-GAAP measures is provided below and a reconciliation of the non-GAAP measures to the comparable GAAP results is provided after the financial statements attached to this release.
“We continued to make progress in the fourth quarter toward our business objectives,” stated Dr. M. Ali Khatibzadeh, President and CEO of TranSwitch Corporation. “Our financial metrics improved with an approximately 18% sequential increase in quarterly revenue and an increase in gross margin to 75%, driven by a favorable mix of IP licensing revenue. More importantly, on the new video connectivity business, we are tracking to our customer and sales expansion plans. Starting with our first customer at the beginning of the quarter, we exited the fourth quarter by commencing production shipments of HDplay™ products for four customers. We anticipate the list of active HDplay™ customers to grow to seven by the end of the first quarter of 2013 and to continuously increase throughout 2013. We have announced some of our new customers during the quarter and more recently. Our list of new customer opportunities for HDplay™ products has increased to over 70 potential customers and we anticipate a marked increase in revenue in the second half of 2013 as more customers reach production phase. Another important catalyst in the ramp of our new business has been the introduction at the 2013 CES of the new members of the HDplay™ product family, which support the new MHL mobile video connectivity standard , in addition to HDMI and DisplayPort , for pico projectors, digital TV’s and other applications. MHL is becoming widely adopted by smart phone and tablet OEM’s with over 220Mu installed base and rapid growth in forecasted volume. TranSwitch is the first company to announce a multi-mode transceiver covering all three major standards. With regards to improving our balance sheet, we have signed an agreement for the sale of one set of our legacy telecom patents and continue to market the balance of our legacy patent portfolio. We will report financial information relating to patent transactions only after the contracts are concluded and closed.”