Inventory rebalancing slips Exar into the red

An Exar product story

Edited by the Electronicstalk editorial team Jan 24, 2007

Exar Corp has reported fiscal 2007 third quarter operating results.

Exar Corp has reported fiscal 2007 third quarter operating results.

Revenue for the quarter ended 31st December 2006 was US $16.1 million, a decrease of 12.9% sequentially from $18.5 million in the second quarter of fiscal 2007 and down 5.3% from $17.0 million for the same period last year.

Year-to-date revenue has increased 6.9% as compared with the same period last year.

Third quarter operating loss was $0.86 million, as compared with operating income of $0.05 million for the prior quarter and operating income of $0.12 million for the same period last year.

Net income for the third fiscal quarter was $3.0 million as compared with $1.8 million for the prior quarter and $1.1 million for the third quarter of fiscal 2006.

For the quarter ended 31st December 2006 EPS were $0.08 per diluted share, up from $0.05 per diluted share for the prior quarter and an increase from $0.03 per diluted share for the same period last year.

For the quarter ended 31st December 2006, EPS include $0.02 per diluted share related to the extension of federal R and D tax credits.

Gross margin was 66.5% in third fiscal quarter as compared with 68.8% in the prior fiscal quarter and 67.5% for the same period last year.

For the third quarter of fiscal 2007 net income includes stock-based compensation expense of $1.1 million as a result of the company's compliance with Statement of Financial Accounting Standards No 123 (revised 2004), Share-Based Payments (SFAS 123R).

Excluding this charge, non-GAAP operating income was $0.2 million and EPS were $0.10 per diluted share.

The company believes that this non-GAAP information is important and valuable to stockholders to help them compare operating performance across reporting periods, however, this information is in no way a substitution for financial measures derived in accordance with GAAP.

"Effective operating expense controls allowed the company to maintain non-GAAP operating profitability in the quarter on lower revenues due to what we believe to be an industry-wide demand slow down and inventory rebalancing", stated Roubik Gregorian, Chief Executive Officer and President.

"Though visibility continues to be challenging our growth will be driven by key design wins moving to production and continued market acceptance of our newer solutions, many of which were industry firsts", stated Dr Gregorian.