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Entropic Reports Second Quarter 2013 Results

SAN DIEGO, July 31, 2013 (GLOBE NEWSWIRE) -- Entropic (Nasdaq:ENTR), a world leader in semiconductor solutions for the connected home, today reported its second quarter results for the period ended June 30, 2013. Entropic reported second quarter net revenues of $70.6 million. This compares to net revenues of $74.5 million in the first quarter of 2013, and $83.1 million in the second quarter of 2012.

In accordance with U.S. generally accepted accounting principles (GAAP), the Company's second quarter net loss was $39.9 million, or $(0.44) per share (basic and diluted). This compares with GAAP net loss of $2.4 million, or $(0.03) per share (basic and diluted) in the first quarter of 2013, and net income of $0.2 million, or $0.00 per share (diluted) in the second quarter of 2012. Included in the GAAP operating results for the second quarter of 2013 is a charge of $26.7 million, or $0.30 per share (diluted), associated with the establishment of a valuation allowance related to federal deferred tax assets.

Non-GAAP net income in the second quarter was $0.6 million, or $0.01 per share (diluted), compared to non-GAAP net income of $0.3 million, or $0.00 per share (diluted) in the first quarter of 2013, and $7.8 million, or $0.09 per share (diluted), in the second quarter of 2012.

"Despite some near term challenges in our business, we continue to build a healthy pipeline of design-wins for our set-top box system-on-a-chip and connectivity products," said Patrick Henry, president and CEO, Entropic. "We continue to focus on getting these new designs ramping into production, and believe the strategic investments and decisions made in Q2, from our asset acquisition, company realignment, reductions in operating expenses, and focus on new product development, put us in a stronger position for long-term revenue growth and enhanced operating leverage."

   
  Three Months Ended
(In millions, except per share data) June 30, 2013 March 31, 2013 June 30, 2012
Net revenues $70.6 $74.5 $83.1
GAAP net (loss) income $(39.9) $(2.4) $0.2
GAAP net (loss) income per share (basic and diluted) $(0.44) $(0.03) $0.00
Non-GAAP net income 1 $0.6 $0.3 $7.8
Non-GAAP net income per share 1 (diluted) $0.01 $0.00 $0.09
1. Please refer to "Non-GAAP Financial Measures" below and the financial statements portion of this press release for an explanation of the non-GAAP financial measures contained in the table above and a reconciliation of such measures to the comparable GAAP financial measures.

RECENT HIGHLIGHTS

Corporate Activities

  • Acquisition News: Entropic acquired the assets of Mobius Semiconductor, Inc. (Mobius), a leading product development company focused on low power, high performance analog mixed-signal semiconductor solutions. The Mobius asset acquisition adds advanced analog mixed-signal expertise and strengthens Entropic's competitive product offerings in both the cable and satellite markets.

Industry Accolades

  • MoCA ® (Multimedia over Coax Alliance) 1.1 Band E Golden Node Certification: Entropic announced its MoCA 1.1 silicon received golden node certification by the MoCA Board of Directors for the Band E frequency, which is a mid-RF band used in DIRECTV homes.
  • CSI Magazine Award Finalist: Entropic Entropic ® 1.1+ technology was acknowledged by CSI Magazine as a leading "cable distribution/transmission solution."

Product Innovations

  • EN2810 Launch: Entropic unveiled the EN2810, the Company's second-generation, single chip MoCA 2.0 system solution, built with the latest 28nm process technology.

New Design Wins

  • NETGEAR: Entropic announced its MoCA 2.0 silicon and software is featured in the NETGEAR WM2500RP MoCA-to-WiFi extender, which boosts whole-home video and data coverage.
  • Hitron Technologies Americas: Entropic announced Hitron's CGNM, a DOCSIS 3.0-certified data gateway, HT-EM, a MoCA-to-Ethernet adapter and the HT-EMN, a MoCA-to-WiFi (802.11n 3x3 2.4GHz) extender will use Entropic's MoCA 2.0 solution, enabling Hitron to deliver an end-to-end high-speed networking backbone for whole-home data coverage.

Partnerships

  • ARM ®: Entropic and ARM strengthened their alliance enabling Entropic to deliver more advanced media and connectivity processing to its customers across the connected home ecosystem.

Key Technology Demonstrations

  • DLNA ® (Digital Living Network Alliance) CVP (Commercial Video Profile) Functionality: At the Cable Show 2013, Entropic and ACCESS showed how cable operators can meet the FCC mandate for cable set-top boxes (STBs) to include an industry-standard IP interface port, and provide DLNA CVP functionality.
  • HTML5: At the Cable Show 2013, Entropic and Opera demonstrated a HTML5-compliant browser for advanced client STBs.

For More Information

Entropic management will be holding a conference call today, July 31, 2013 at 2:30 p.m. Pacific Time/5:30 p.m. Eastern Time to discuss the Company's results for the second quarter of fiscal 2013, and to provide guidance for the third quarter. You may access the conference call via any of the following:

Teleconference: 888-680-0869
Access Code: 84815350
Web Broadcast:  http://events.entropic.com/
Replay:  888-286-8010
Replay Passcode: 24265106

About Entropic

Entropic™ (Nasdaq:ENTR) is a world leader in semiconductor solutions for the connected home. The Company transforms how traditional HDTV broadcast and IP-based streaming video content is seamlessly, reliably, and securely delivered, processed, and distributed into and throughout the home. Entropic's next-generation Set-top Box (STB) System-on-a-Chip (SoC) and Connectivity solutions enable Pay-TV operators to offer consumers more captivating whole-home entertainment experiences by transforming the way digital entertainment is delivered, connected and consumed - in the home and on the go. For more information, visit Entropic at: www.entropic.com.

The Entropic logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=4255

Non-GAAP Financial Measures

This press release and the accompanying tables contain the following non-GAAP financial measures: net income and net income per share. These non-GAAP financial measures exclude the effects on the Statement of Operations of all forms of stock-based compensation, transaction and integration costs related to the Trident Microsystems, PLX Technology and Mobius Semiconductor, Inc. transactions, amortization of intangible assets, the loss related to equity method investment, the impairment of investment the impact of fair value adjustments related to contingent consideration payable in the acquisition of PLX Technology assets, deferred tax asset valuation allowance, the cash tax difference and the restructuring charge.

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