Inphi reported Q1 2020 revenue $139.4 million, up 69.6% year-over-year, compared with $82.2 million in the first quarter of 2019. The increase was due to higher demand for Cloud and Telecommunications products as well as the inclusion of eSilicon revenues as a result of the acquisition that closed on January 10, 2020.
Gross margin under GAAP in the first quarter of 2020 was 52.9%, compared with 57.9% in the first quarter of 2019. The decrease was mainly due to amortization of intangibles, step up value of inventories related to the eSilicon acquisition and product mix.
GAAP net loss for the first quarter of 2020 was $20.3 million or ($0.44) per diluted common share, compared with $22.7 million or ($0.51) per diluted common share in the first quarter of 2019.
Non-GAAP net income in the first quarter of 2020 was $31.5 million, or $0.62 per diluted common share. This compares with non-GAAP net income of $15.4 million, or $0.33 per diluted common share in the first quarter of 2019.
“As the global health crisis continues to be a challenge, the demand for bandwidth remains solid, as detailed in our April 22 blog on Inphi’s website,” said Ford Tamer, President and CEO of Inphi Corporation. “Prior to the crisis, we were already delivering on new product cycles for our cloud and telecom customers. These included upgrades of data center, 5G, metro and long-haul networks to PAM and Coherent technologies, designed to increase available bandwidth. Now, we believe the significant paradigm shifts brought on by ‘work from home’, electronic commerce, distance learning, streaming and other remote usage activities may result in further acceleration of bandwidth upgrades. While we remain cautiously optimistic for continued growth, we will also work to verify the sustainability of this new demand.”
Business Outlook
- Revenue in Q2 2020 is expected to be in the range of $147.8 million to $152.0 million.
- GAAP gross margin is expected to be approximately 51.6% to 53.9%.
- Non-GAAP gross margin is expected to be approximately 63.5% to 65.5%.
- Stock-based compensation expense is expected to be in the range of $26 million to $28 million.
- GAAP net loss is expected to be in range between $15.0 million to $21. 5 million, or ($0.31) to ($0.45) per basic share, based on 47.8 million estimated weighted average basic shares outstanding.
- Non-GAAP net income, excluding stock-based compensation expense, acquisition expenses, amortization of intangibles and inventory fair value step up related to acquisitions and noncash interest on convertible debt, is expected to be in the range of $33.15 million to $36.35 million, or $0.62 to $0.68 per weighted average diluted share, based on 53.1 million estimated non-GAAP weighted average diluted shares outstanding.
