MIPS Technologies Inc. (MIPS)
F3Q10 (Qtr End 03/31/10) Earnings Call
April 27, 2010 4:45 pm ET
Jen Bernier - Public Relations Manager
Sandeep Vij - CEO
Maury Austin - CFO
Gary Mobley - Benchmark
Anthony Stoss - Craig Hallum
Jeff Schreiner - Capstone Investments
Suji De Silva - Kaufman Brothers
Previous Statements by MIPS
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Good afternoon and welcome to the MIPS Technologies third quarter fiscal 2010 financial results call. Today’s conference is being recorded. If you have any objections, you may disconnect at this time.
I'll now turn the call over to Jen Bernier, MIPS' Public Relations Manager. Ma’am, you may begin.
Thank you, and welcome to the MIPS Technologies' third quarter 2009 Earnings Call. I'm Jen Bernier, MIPS' Public Relations Manager.
Leading the call today are Sandeep Vij, Chief Executive Officer and Maury Austin, Chief Financial Officer.
After they discuss the business highlights and detailed financial results, we'll open the call for Q&A. If you do not have a copy of the earnings release, it is available on our website at www.mips.com.
Before we begin, I would like to remind you that this conference call may contain forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995, including projections of certain operating results for the fourth quarter of 2010.
Listeners are cautioned not to place undue reliance on this forward-looking information. Many important factors could cause the results to differ materially from those contained in such projections or forward-looking statements. We refer you to the risk factors section of the documents that we file from time-to-time with the Securities and Exchange Commission for factors that may cause the results to differ materially from our forward-looking statements.
In our financial discussion today, we will be referring to the third quarter 2010 GAAP and non-GAAP results. MIPS' management believes that non-GAAP information is useful, because it can enhance the understanding of the company’s ongoing economic performance. MIPS Technologies uses non-GAAP measures in evaluating its financial results, as well as for internal planning and budgeting purposes.
The non-GAAP results exclude FAS 123R stock option expense, certain costs and expenses related to acquisitions, divestitures, impairments and restructuring costs incurred during the period. Please refer to the earnings press release or to the Investor Relations page of our website for a reconciliation of GAAP to non-GAAP.
As a reminder, the playback number for this conference call is 203-369-0063, and the access code is MIPS. The recorded call will be available for 30 days after the call. An audio replay will also be posted on the Investor Relations page of our website at www.mips.com.
With that said, I will now turn the call over to Sandeep Vij.
Thank you all for joining us today. We had a good quarter coming in at the high end of the guidance and hitting several key milestones along the way.
Revenue grew to $17.5 million, an increase of 15% over the prior quarter. Quarterly royalty units grew to a record $135 million units, which was our highest quarterly unit volume ever.
In this quarter, we also released our new M14K core family to general availability. It is the first core to implement our new microMIPS architecture and it got two [lite sensor] in the first week it was available.
MIPS also secured a large and fast growing fabless semiconductor company in Asia Pacific as its flagship mobile handset customer. Through extensive evaluation, this supplier selected the MIPS solution over its incumbent ARM-based solution for its next generation mobile handset chips. This customer is targeting a range of 3G mobile phones, including Android smartphones, and is the anchor mobile handset customer we have been looking for.
We are pleased that we got this customer sooner rather than later. This is now our third licensee targeting mobile handsets with MIPS.
In Q3, we announced the China-based Mavrix will develop a mobile applications processor based on MIPS. And Altera Semiconductor is creating mobile WiMAX baseband chips based on MIPS. Now we have this new significant additional design wins.
Based on these wins, our licensees are on track to introduce the first MIPS-based handset chips in the first half of calendar 2011. At the same time, MIPS momentum continues in other areas of the mobile market.
In Q3, we saw our first royalties from the femtocell market and we saw great momentum in WiMax and LTE 4G technologies that will drive the next generation mobile products. This is an area of opportunity and growth for MIPS.
WiMax shipments were up in the quarter and MIPS licensees in this market made numerous announcements during the quarter, including Beceem, who filed for an IPO and just this month announced multiple customer wins.
With our leading position in Wi-Fi and WiMax, we are in a perfect position to continue gaining share in 4G, since 4G is all about data traffic. In February during the Mobile World Congress, where MIPS exhibited for the first time, we saw a lot of traction in mobile applications. There were ports to MIPS from four separate LTE software vendors and two distinct end-to-end LTE solutions, including one from MIPS architecture licensee, Cavium Networks.
MIPS-based LTE solutions from our licensee, Altera Semiconductor, were demoed by companies including ZTE, Huawei, Anritsu, Aeroflex and Litepoint. Our licensee, Wintegra, also featured numerous announcements and demos around LTE on MIPS. And NetLogic announced that its MIPS-based processors are powering LTE trials worldwide and also powering ZTE’s next generation mobile infrastructure network products.