Towbin thinks the CSCO contract, I was alluding to earlier, made them a 10% customer. Can’t remember why, but I was under the impression that the CSCO contract was going to be a lot larger???? Anyway
unterberg.com 701
Finisar
Aug , 30 , 2002 , 08:00 : In-Line Q1; Gross Margin Upside. FNSR reported first (July) fiscal quarter results with revenues of $47M, up 12% sequentially and above consensus expectations of $46.5M. Loss of $0.07 per share was in line with consensus. Gross margins increased to 27.3% from 24.5%, beating guidance of 26%, on improved yields in Malaysia and higher ASPs, a function of higher CWDM sales. Transceiver pricing was not as bad as what Stratos was saying— FNSR is seeing single-digit price declines—certainly not the 10%- 15% Stratos (STLW1 $0.71, MP/B) is suffering.
Revenues broke down as follows:
Fiber channel, at $18M, was down 7% sequentially, with, for the first time, no 10% FC customers. Management commented that in the last four weeks, customers have become more cautious and business lumpier. It may be that the IT environment actually has worsened, coupled with some inventory building at the OEMs. While we don’t believe FNSR is losing market share, we point out at McData, Picolight is currently the preferred vendor, entirely on pricing. Flat FC sales are expected in Q2, with increases in both Q3 and Q4.
GigE sales were $11.2M, up 50% sequentially. We suspect Cisco was a 10% plus customer and Extreme just below 10%; CWDM sales were $6M, up 124%; CATV sales were $1.8M; up 47%; testing tools were $7.8M, down 3% and telecom sales were $3, down 19%. Operating expenses, at $25.5M, were down 2%.
FNSR announced a $1M restructuring in Q4:02 and so far, opex have been lowered $500K or 2%. With margins and opex flat in Q2, we expect a slight (1%) reduction in opex in Q2 with the major impact coming in the 2H03. Our model already assumes another $3-$5M in restructurings.
Here is link to Soundview’s thoughts on CC:
research.soundview.com |
