Previous Statements by QLGC
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In our first quarter earnings press release issued earlier today, we reported both GAAP and non-GAAP results. All of the reference we will make on our call today relate to non-GAAP results unless otherwise stated. A reconciliation of the non-GAAP to the GAAP financial measures is available on our website under Investor Relations.Turning now to our financial result. For the first fiscal quarter ended July 4, 2012. Our revenue in the first quarter was $130.4 million, compared to $144.5 million we recorded in the same quarter last year. This revenue was within our guidance range of $130 million to $135 million provided during our fourth quarter earnings call. Our first quarter revenue from Host Products, which are comprised primarily of Fibre Channel, converged and 10-Gig Ethernet adapters, was $101 million compared to $108.9 million we recorded in the first quarter of last year. The state of declines is consistent of the way the trends that have been reported by majority of our customers. First quarter revenues from Network Products which are comprised primarily of Fibre Channel switches was $19.5 million compared to $18.7 million recorded in the first quarter of last year. Our first quarter revenue from Silicon Products, comprised of our Fibre Channel, converged, 10-Gig Ethernet and iSCSI chips, was $9.8 million and consistent with our expectations. Our first quarter gross margin of 67.6% declined from 69.6% recorded in the first quarter of last year, primarily due to unfavorable product mix. Our gross margin was consistent with our guidance of approximately 58% provided during our fourth quarter earnings call. Next, I would like to cover our first quarter operating expenses. As a reminder, we continue to invest in engineering in order to address increased opportunities and expand our share of the market while aggressively managing sales, marketing and engineering cost. Total operating expenses were $58.5 million, up from $55.3 million reported in the first quarter of last year. Operating expenses were consistent with our expectation. Engineering expenses in the first quarter of $35.1 million increased from $30.5 million last year.