Chris,here's what the local San Diego Union Tribune has to say about AMCC 4th quarter report and the 3 new companies that it is purchasing
uniontrib.com
Profits, revenue robust at AMCC
Company also buying three chip-design firms
By Brian E. Clark
UNION-TRIBUNE STAFF WRITER
April 20, 2000
SAN DIEGO -- Applied Micro Circuits Corp., the San Diego-based manufacturer of high-performance telecommunications chips, reported yesterday that fiscal fourth-quarter profits climbed more than fivefold and revenue nearly doubled over the same period last year.
AMCC President and CEO Dave Rickey also announced that his company is buying two Southern California chip-design firms, including San Diego's YuniNetworks, and a third in Canada.
Applied Micro is using its soaring stock to buy companies that will give it a competitive edge over rivals Lucent Technologies and Vitesse Semiconductor Corp. It will aim the chips it acquires with YuniNetworks at companies that build high-capacity routers that speed information on computer networks.
The stock deal for YuniNetworks, estimated at $241 million, is expected to close in May. AMCC also bought Chameleon Technologies of Irvine and pBaud Logic of Kanata, Ontario. No sales price was disclosed for the latter two companies.
Applied Micro's net income for the quarter ended March 31 rose to $20.6 million, or 16 cents a share, up from $3.4 million a year ago. The company was expected to earn 14 cents, the average analyst estimate from First Call/Thompson Financial. Revenue rose to $57 million from $28.7 million for the same period in 1999.
Sequentially, net revenues for the fourth quarter increased 25 percent over the $45.8 million reported in the previous quarter, and net income increased 70 percent over the $12.1 million in the third quarter.
"Bookings continue to surge," Rickey said. "This creates a very positive outlook for further sequential growth. The communications business is robust. We had a great fourth quarter."
Net revenue for the fiscal year was $172.4 million, up 64 percent over last year. Net income was $48.6 million, up 184 percent for fiscal 1999.
Sandy Harrison, an analyst with Pacific Growth Securities, said he expected good news for the fourth quarter, but still was impressed with the $57 million revenue report.
"I'd heard they were doing well," he said. "And that 25 percent sequential growth is something."
Harrison said the announcement that AMCC is buying three chip-design companies was no surprise.
"They are in a mode to push things forward and will be acquiring more companies that meet their criteria," he said. "Their standards are high, but we'll see more of this."
Karl Motey, an analyst with C.E. Unterberg, Towbin in San Francisco, said he was pleased with AMCC's performance.
"This is a nice upside surprise," he said. "We were only expecting 17 percent growth from last quarter. And the outlook is only improving for AMCC. They are in the sweet spot of the semiconductor market for optical components.
"I think we'll see them buy more companies and additional engineering talent. That's been the trend in the communication industry, especially as time-to-market becomes a bigger issue."
Rickey said his company's sales are surging thanks to "explosive" growth in demand for fiber-optic equipment made by Nortel Networks Corp., its biggest customer. AMCC supplies Nortel with semiconductors that help convert electronic data into pulses of light for transmission on strands of hair-thin glass known as optical fiber.
Applied Micro's shares fell $4.121/2 to $103.121/2. Earnings were released after the close of regular U.S. trading. Its shares have risen more than eightfold from a year ago and 62 percent this year.
¸ Copyright 2000 Union-Tribune Publishing Co.
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