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Spreadtrum Communications (SPRD) – Comments & Business Outlook
THIRD QUARTER 2012 FINANCIAL SUMMARY:
- Total revenue increased 8.5% quarter-over-quarter and 1.7% year-over-year to US$187.9 million, exceeding the Company’s previously guided range of US$178 – US$186 million.
- Gross profit was US$70.1 million compared to US$64.2 million in the previous quarter and US$77.2 million in 3Q11. Gross margin was 37.3% compared to 37.1% in the previous quarter and 41.8% in 3Q11.
- Cash flows from operations were US$45.7 million, compared with US$16.8 million in the previous quarter andUS$30.5 million in 3Q11.
- GAAP net income was US$23.2 million, compared with US$21.0 million in the previous quarter and US$39.3 million in 3Q11.
- GAAP net income per basic and diluted ADS was US$0.50 and US$0.44, respectively, an increase fromUS$0.45 and US$0.41 per basic and diluted ADS, respectively, in 2Q12 and a decrease from US$0.84 andUS$0.75 per basic and diluted ADS, respectively, in 3Q11.
- Non-GAAP net income was US$29.3 million, compared to US$29.6 million in 2Q12 and US$43.5 million in 3Q11. Non-GAAP net income per diluted ADS was US$0.56, a decrease from US$0.58 per diluted ADS in 2Q12 and US$0.83 per diluted ADS in 3Q11.
Commenting on the results, Spreadtrum’s Chairman and CEO, Dr. Leo Li said, “This quarter, we exceeded our revenue guidance as a result of very strong demand for our TD-SCDMA and EDGE smartphone chipsets. Our smartphone products are fueling the growth of a new ultra-low cost retail segment in China and in overseas markets, making smartphones more affordable and attractive to the first time smartphone buyer. We expect shipments to continue to grow in the fourth quarter.
“In the 2.5G segment, we have begun commercially shipping our 40nm SC6530 GPRS chipset to Samsung. In doing so, we are the first Asia-based baseband chipset provider to qualify GPRS/GSM baseband chipsets with a global first tier handset maker. This opens up a larger addressable market for our products and validates the maturity and quality of our solutions.
“Looking ahead to 4Q12, we expect revenue to be in the range of US$189 million to US$196 million, which is a sequential increase of 0.6% to 4.3%, with a flat gross margin relative to the third quarter. “This quarter we are expanding our product portfolio to include WCDMA chipsets, dual-core smartphone chipsets, and integrated connectivity which will help drive further growth in 2013.”
Further commenting on the 3Q12 financial results, Shannon Gao, Spreadtrum’s CFO added, “The strong ramp in smartphone products this quarter helped drive an increase in gross margin and we expect to see continuing improvement in product mix as smartphones scale in large volume in 2013. In Q4, we anticipate continuing increases in R&D spendings as we bring new products to market and expand our portfolio to new technologies. In the short term, we expect that our operating margin will remain stable.”
BUSINESS OUTLOOK:
Looking ahead, Spreadtrum expects revenue for the fourth quarter of 2012 to be in the range of US$189 million -US$196 million with a flat gross margin relative to the third quarter.
2012-11-09 18:21:06
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