Silicon Investor - Spansion Inc.

[TimF] Spansion buys Fujitsu's MCU, analog business Dylan McGrath 4/30/2013 11:24 AM E...

TimF — 7/2/2013 2:28:15 PM

Spansion buys Fujitsu's MCU, analog business

Dylan McGrath
4/30/2013 11:24 AM EDT

LONDON – Flash memory supplier Spansion Inc. (Sunnyvale, Calif.) is set to buy the microcontroller and analog business of Japan-based Fujitsu Semiconductor in a deal valued at about $175 million.

Under the terms of the deal, Spansion will acquire assets, intellectual property, products and personnel from Fujitsu. But the deal does not include any of Fujitsu's manufacturing facilities. Spansion also announced first quarter sales that came in short of analysts' expectations.

John Kispert, Spansion's CEO, said the deal positions Spansion to play in a much broader market. "Both sides are very excited about this deal," Kispert said.

Two years ago, when Spansion emerged from bankruptcy as a supplier of NOR flash, the company was serving a total market of about $3 billion, Kispert said. Last year, Spansion inked a deal with SK Hynix Inc. to enable Spansion to offer single-level-cell (SLC) NAND flash devices for the embedded market. Following the completion of the Fujitsu deal, expected to close next quarter, Spansion will be serving a total market worth about $30 billion, Kispert said.

"This [deal] opens up a whole bunch of options for [Spansion]," Kispert said. Among other synergies, the acquisition of Fujitsu--which is the No. 2 supplier of microcontrollers to Japan's automotive market--will give Spansion an in with Japan's massive auto industry, Kispert said. The deal also gives Spansion the technology to offer embedded SoCs with processing, memory and analog functionality, he added.

"This acquisition provides incremental revenue and aligns with our strategy to expand into system-on-chip solutions that require leadership in embedded flash technology," Kispert said.

As a condition of the deal, Fujitsu will continue to build its legacy parts for Spansion at its fabs in Japan for the next two years, Kispert said. Those fabs have been widely seen as in danger of closing as Fujitsu moves to restructure and largely disengage from the semiconductor business (see Fujitsu chip business faces radical restructure). It was been widely reported that one or more of the major foundry companies could be interested in acquiring those fabs.

Spansion said it would combine its flash memory technology with microcontroller and analog products to accelerate the development of system-on-chip ICs for use in the Internet of everything for automotive, industrial and consumer applications.

Kispert said the deal, once closed, will be immediately accretive to Spansion's earnings. The net impact is expected to benefit Spansion's financial results in 2013 and the deal is part of a previously announced restructuring at Fujitsu.

The purchase price includes about $110 million for assets and intellectual property plus about $65 million for inventory. The cost of the inventory is subject to change due to fluctuations in inventory volume and value. The deal is subject to various customary closing conditions and is expected to be complete in the third calendar quarter of 2013.

eetimes.com

[TimF] Are Shorts Watching Spansion? fool.com

TimF — 8/16/2012 9:56:56 PM

[TimF] Spansion eyes aggressive road map after strong Q2 Brian Fuller7/31/2012 7:15 PM ...

TimF — 8/16/2012 9:54:01 PM

Spansion eyes aggressive road map after strong Q2
Brian Fuller7/31/2012 7:15 PM EDT

SUNNYVALE, Calif.--Memory maker Spansion, which reported strong second-quarter earnings today, has an "aggressive" roadmap to boost its product-introduction rate and break its latest design-win record, its CEO, John Kispert, said today.

Kispert spoke shortly after his company reported Q2 2012 revenue up 11 percent from Q1 to $233.4 million. Net income of $26 million compared with a first-quarter loss of $13.1 million. While the company positioned the numbers as a growth story, the company's quarterly sales still were down 22 percent from the same quarter in 2011, although quarterly profits in that same period were up slightly. Here's a link to the company press release.

The quarter marked another respectable milestone for a company that little more than two years ago went through a near-death experience with bankruptcy reorganization, early in Kispert's tenure. The company's recent fourth- and first-quarter losses were attributed in part to reorganization costsassociated with shedding of its test operations overseas.

Forward progress
"We're definitely getting there," Kispert said in a phone interview. "We'll keep up the pace. We're on a very aggressive road map."

Spansion reported a record 458 design wins in the period. Kispert attributed that partly to strategic positioning ("We're a products company") and partly to product expansion that includes not only its memory portfolio but its recent move into designs that offer a mix of memory and logic.

In June, the company teamed with Nuance Communications to create the Spansion Acoustic Coprocessor. The first two members of the new family are targeted at car infotainment systems.

"We're growing the markets that we're in," Kispert said, alluding to the fact that the acoustic coprocessor gives Spansion to move beyond existing memory-only design wins in automotive systems.

For the third quarter, Spansion expects revenue to fall in the $230-$250 million range, with rising gross margins into the 35-38 percent range.

In the just-finished period, the company's application revenue changed slightly from Q1 to Q2:


.	Revenue by market	Q1-2012	Q2-2012
.	Consumer	36%	37%
.	Transportation & Industrial	32%	26%
.	Communications & Gaming	21%	31%
.	Wireless	6%	3%
.	Royalty	5%	3%
.	Total	100%	100%

On a U.S. GAAP (generally accepted accounting principles) basis, Spansion reported second quarter net sales of $233.4 million, gross margin of 31.7%, operating income of $37.8 million, net income of $26.0 million and diluted EPS of $0.43. GAAP net income includes a one-time gain of $28.4 million from sale of the Company's former manufacturing operation facility in Kuala Lumpur, Malaysia, the company said.

On a non-GAAP basis, net sales totaled $233.4 million, adjusted gross margin was 35.5%, adjusted operating income was $25.0 million, adjusted net income was $13.7 million and adjusted diluted EPS was $0.22, the company said.

eetimes.com