Electronics IP Industry – Q3 2011
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Electronics IP Industry – Q3 2011

Introduction

Herein we return our attention to the phenomenon of the rise of Intellectual Property (IP) in the world’s Electronics Industry, a segment of Electronic Design Automation (EDA) that Henke Associates began reporting on separately in 2003. 

At the beginning, we covered eight (8) publicly-traded IP companies (called the "Group-of-8" or "G8"), as representative of the financial state of the nascent Electronics IP Industry. Subsequently, ARM absorbed Artisan Components in 2004; Mentor Graphics acquired LogicVision in 2009; and Synopsys bought Virage Logic in 2010. So nowadays, when we report on the Electronics IP Industry quarterly financials, the G5 listed below are included: 

The Q2 2011 financial results of the G5 IP vendors were posted here on August 22, 2011, just at the beginning of a period of economic volatility that was precipitated by the debt ceiling debate in Washington DC and subsequent reduction of the USA’s credit rating by S&P from AAA to AA+.

The aforementioned continuing volatility in the economy is visible to anyone looking at the stock markets’ performances. Below is a graph of the last six months of the NASDAQ Composite, for example. Please note: (a) the relative stability at just above the 2800 level for the initial months shown till late July 2011; (b) the steep plunge to below 2400 by mid-August; (c) the relatively wild oscillations since, and (d) never closing at 2800 or above since.


NASDAQ Close Nov 04 = 2686.15
52 week range = 2298.89 – 2887.75 



G5 Electronics IP Vendor by Vendor Details – Q3 2011

Just for variety, let’s first look at the individual performances of each member of the Group of Five (a.k.a. the G5) Electronics IP players for nominal Q3 2011. Then we’ll follow up with a summary of the by-now-familiar Tables of Revenues and Profits of the entire G5 for Q3 2011 (and the four quarters leading up to Q3 2011), as well as some graphs of previous year-by-year P&L’s.





On October 25, 2011 ARM Holdings plc announced its unaudited financial results for the third quarter ending September 30, 2011.


 


ARM Progress on key growth drivers in Q3 2011

Warren East, Chief Executive Officer, said, “In the third quarter of 2011, we saw a continued high level of design activity with many new customers licensing ARM technology for the first time, driven by end market requirements for smarter, low-power chips. Demand for our technology has come from a broad range of applications, from sensors to computers.”


Warren East

“Over the last year we have seen strong growth in shipments of ARM technology-based chips, with a 50% increase of shipments into non-mobile markets such as digital TVs, microcontrollers and networking applications. Royalty revenues in Q3 have been impacted by the below seasonal growth in the semiconductor industry, but we continue to gain share. With customers looking to design ARM technology into a widening product portfolio, ARM is continuing to invest in the development of new products to drive long-term growth in our revenues, profits and cash,” concluded East.

ARM Guidance

ARM says it enters the final quarter of 2011 with a healthy opportunity pipeline for licensing and an order backlog which remains at historically high levels. This combination points to another strong quarter for license revenue in Q4 2011 and a robust order backlog at the year end. ARM Q4 2011 royalty revenues are generated from third quarter chip shipments. Data for the third quarter indicates that relevant industry revenues were broadly flat sequentially.

Notwithstanding the below-seasonal activity levels in the wider semiconductor industry, ARM expects that group dollar revenues for the full-year 2011 will be in line with current market expectations of around $763 million.

Total Revenues

Total IFRS revenue for ARM in Q3 2011 was $192.3 million, up 22% over $158.1 million in Q3 2010, but only 1.1% more than sequential Q2 2011 revenue of $190.2 million. (The revenue fx rates [$/pound] used by ARM were 1.60 for Q3 2011, and 1.58 for Q3 2010).

Total Earnings 

Total IFRS earnings for ARM in Q3 2011 were approximately $50,235 thousand, up 17.12% vs. sequential Q2 2011’s $42,890 thousand, and up an impressive 114.87% year-over-year vs. $23,379 thousand in Q3 2010.

Worldwide Headcount

As of September 30, 2011, ARM had 2,039 full-time employees, a net increase of 150 since the start of the year, being mainly engineers joining ARM’s processor R&D teams. At the end of Q3 2011, the group had 850 employees based in the UK, 530 in the US, 234 in Continental Europe, 293 in India and 132 in the Asia Pacific region.

ARM self description

ARM designs the technology that lays at the heart of advanced digital products, from wireless, networking and consumer entertainment solutions to imaging, automotive, security and storage devices. ARM's comprehensive product offering includes 32-bit RISC microprocessors, graphics processors, video engines, enabling software, cell libraries, embedded memories, high-speed connectivity products, peripherals and development tools. Combined with comprehensive design services, training, support and maintenance, and the company's broad Partner community, they provide a total system solution that offers a fast, reliable path to market for leading electronics companies. More information on ARM is available at http://www.arm.com.

ARM Closing Price Nov 04 = $31.21
52 week range = $16.78 – $32.18
Market Cap = $14.02 billion

 

Late News about ARM

ARM Server Technologies Get Multiple Boosts

The low-power ARM server concept recently got several big boosts as ARM Holdings, Calxeda and Hewlett-Packard announced individual and collaborative efforts.

ARM Holdings just described its ARMv8 architecture, which is the company's first 64-bit design. The technology has already been released to some of ARM's chip-making partners. ARM Holdings expects consumer and enterprise prototypes of the new 64-bit chips to emerge sometime in 2014.

Possibly, the new 64-bit design might help move ARM into the x86-dominated server market, although 32-bit ARM servers running Linux already are available. The prospect of Windows Server on ARM still seems far off. Microsoft has had a 13-year partnership with ARM, but it's mostly been based on its Windows Embedded operating systems for handheld devices. In January, Microsoft announced that its next client OS, Windows 8, will run on ARM-based devices. The prospect of Windows Server 8 on ARM has just remained speculative as Microsoft has announced nothing definitive.

Windows Server 2008 was Microsoft's last 32-bit server. Possibly software compatibility issues may trip up Windows Server on ARM silicon as Microsoft has been moving most of its server technologies more toward 64-bit metal. However, 32-bit might not pose a disadvantage in moving to ARM, according to Martin Reynolds, a vice president and fellow at Gartner.

"One of the possibilities, if we were to go with smaller server cores, is that we might well be able to go back to 32-bit and use less memory," Reynolds said in a phone interview.

In any case, Microsoft issued a positive message about the 64-bit ARM architecture, which was ascribed to K.D. Hallman, Microsoft Corp.'s general manager.

"ARM is an important partner for Microsoft," Hallman stated in a prepared release. "The evolution of ARM to support a 64-bit architecture is a significant development for ARM and for the ARM ecosystem. We look forward to witnessing this technology's potential to enhance future ARM-based solutions."

Calxeda's Server-on-Chip Design

On Tuesday, November 1, 2011, Austin Texas-based startup Calxeda unveiled its low-power, ARM-based, EnergyCore server-on-chip processor. Equally as important is Calxeda's newly announced partner on the technology, Hewlett-Packard (described below).

EnergyCore is capable of using as little as 1.5 watts of power, according to Calxeda. The 1.5-watt figure is for the two-core server-on-chip product. An Intel low-power Atom chip, by comparison, consumes 22.6 watts of power, according to Karl M. Freund, vice president of marketing at Calxeda, in a recorded Webcast. Calxeda's four-core chip uses 3.8 watts of power and compares favorably in that respect to an Intel Xeon two-core chip, which consumes 34.9 watts of power, Freund said.

Barry Evans, CEO and founder of Calxeda, claimed during the company's presentation that EnergyCore will enable a performance improvement that's 10 times current server technologies, and save on power consumption, too.

"A server today runs 100 watts or more of power," Evans said. "It will burn up to 80 watts of power while it's waiting for something to do."

He described the debut of EnergyCore as a major milestone for the company. It adds scaling technologies that allow the interconnection of thousands of nodes in a single fabric at low cost, Evans contended. Calxeda created an organic management mechanism to manage clusters from 1,000 nodes all of the way down to a single node. Uses might include offline analytics, big data (Hadoop), Web applications, mid-tier infrastructure such as Memcached and in-memory databases, and storage-oriented applications such as file serving and content delivery, Evans said.

Canonical has been testing EnergyCore with the Ubuntu OS for servers. Canonical Founder Mark Shuttleworth provided a recorded segment during the Calxeda announcement. He predicted that ARM was going to shake up the server and datacenter world, which is moving toward massively parallel processing. He also claimed that Ubuntu will be "natural fit" for such a world.

Investment bank Cantor Fitzgerald has also been experimenting with EnergyCore as part of its high-frequency messaging platform for financial trading.

HP's Project Moonshot

Hewlett-Packard on Tuesday November 1, 2011 issued a separate announcement about its new server development program called "Project Moonshot," which aims to apply low-power technologies for Web, cloud and massively scaled applications. HP didn't explain the origin of the project's name, but Shuttleworth is one of a few people who have taken a ride into space under the Space Adventures tourist program.

Project Moonshot has three components, according to Paul Santeler, vice president and general manager of HP's Hyperscale Computing Division. One component is the HP Redstone Server Development Platform, a proof-of-concept server that deploys low-energy processors (see photo). The initial platform uses Calxeda's EnergyCore ARM Cortex processors. However, HP plans to incorporate Intel's Atom and other energy-saving chips in the future. The current HP Redstone Server uses "more than 2,800 servers in a single rack," according to HP's announcement. The platform will be rolled out to "select customers" in the first half of 2012, according to HP.


The HP Redstone Server Development Platform.


A second component of Project Moonshot is an HP Discovery Lab for industry-peer testing of the low-energy server. HP expects to open a lab in Houston in January. Other sites are planned for Asia and Europe. Forrester Research analyst Richard Fichera, who has vigilantly tracked low-power ARM server developments, commented in a blog post that the knowledge gained from the labs might prove to be "more valuable in the early phases than any product revenues that flow from them." Fichera appeared during Calxeda's presentation and noted that the pump is now primed with vendors joining the effort. However, he also noted that "software compatibility is the big elephant in the room."

Finally, HP announced its Pathfinder Program associated with Project Moonshot. The program brings together various independent software companies that are developing networking, compute and storage solutions. Partners expected to join the program, according to HP's announcement, include ARM Holdings, Calxeda, Canonical, Red Hat and AMD.

On the Low-Power Server Map

Fichera concluded that ARM-based servers now "are on the industry road map," although he discounted the idea that it would "destroy Intel and AMD as server vendors." The fact that HP endorsed ARM for servers likely doesn't mean it is dropping x86.

Charles King, president and principal analyst at the Pund-IT Inc. IT analyst firm, noted that there are other low-power server options out there, including projects championed by Oracle and IBM.

"IBM has long focused on delivering power efficiency features for both its Power Systems and System z mainframes, including a host of system management solutions (mostly in its System Director and Tivoli portfolios)," King explained via e-mail. He added that these platforms are also positioned as energy-efficient solutions for server virtualization, supporting "far greater numbers of virtual machines than x86 servers."

Oracle promoted the energy efficiency of its T4 SPARC chips at the last OpenWorld conference, King indicated.

"In part, I think that [Oracle's pronouncement] was mainly a PR play -- making certain that vacillating Sun customers knew they have a next-gen platform to move to," King explained. "But the fact is that in the high-density datacenters of the future, enhanced energy efficiency and its long term OPEX benefits will be subjects of interest to virtually every enterprise."

About the Author

Kurt Mackie is online news editor, Enterprise Group, at 1105 Media Inc.







On October 27, 2011 CEVA, Inc. (NASDAQ: CEVA); (LSE: CVA), the leading licensor of silicon intellectual property (SIP) platform solutions and DSP cores for the mobile handset, portable and consumer electronics markets, announced its financial results for the third quarter ended September 30, 2011.

Please note that CEVA was featured in great detail in the recent October 17, 2011 EDA WEEKLY:

http://www10.edacafe.com/nbc/articles/view_weekly.php?articleid=1016941


Q3 2011 CEVA Highlights

- First license agreement for CEVA-MM3000 video & imaging platform for smart phones and smart TVs
- Quarterly volume of CEVA-powered units shipped increase for eleventh quarter in succession, reaching 250 million
- Record high profitability - gross margins expand to 95%, operating margins reach 32% on a US GAAP basis.

 

CEVA Q3 2011 REVENUE

Total revenue for the third quarter of 2011 was $14.847 million, an increase of 39.08% compared to $10.675 million reported for the third quarter of 2010. Q3 2011 total revenue also exceeded that of sequential Q2 2011, although the excess was only a slim 3.18%.

Third quarter 2011 licensing revenue was $5.2 million, representing an increase of 17% when compared to $4.5 million reported for the same quarter a year ago. Royalty revenue for the third quarter 2011 was $8.8 million, an increase of 67% compared to $5.2 million reported for the third quarter of 2010. Revenue from services for the third quarter of 2011 was $0.9 million, a decrease of 12% compared to $1 million reported for the third quarter of 2010.

Gideon Wertheizer, Chief Executive Officer of CEVA, stated, "CEVA's strong third quarter performance reflects the continued strength of our cellular baseband presence, as shipment volumes of CEVA-powered products increased for the eleventh consecutive quarter, reaching 250 million units during the quarter.”


CEO Wertheizer

“We continue to see considerable interest in our diverse technology portfolio from both existing and new customers, as evidenced by strategic licensing agreements with a high volume semiconductor vendor for our new CEVA-MM3000 platform to be used for smart phones and smart TVs and with a tier one handset and tablet OEM for our audio platform," concluded Wertheizer.

Of the eight new license agreements concluded during the third quarter of 2011, six agreements were for CEVA DSP cores, platforms and software, one agreement was for CEVA SATA/SAS product lines and one agreement was for CEVA Bluetooth technology. Target applications for customer deployment are 4G baseband processors, video, imaging and audio in application processors, power line communications (PLC), connectivity and solid state drives (SSDs). Geographically, two of the agreements signed were in the US and six were in Asia Pacific, including Japan.

CEVA Net Income

US GAAP net income for the third quarter of 2011 was $4.935 million, an increase of 65.10% over $2.989 million reported for the same period in 2010.  Q3 2011 Net Income was also 19.69% above the $4.123 million net achieved in sequential Q2 2011.

US GAAP diluted earnings per share for the third quarter of 2011 were $0.20, an increase of 54% compared to $0.13 for the third quarter of 2010.

Yaniv Arieli, Chief Financial Officer of CEVA, stated, "Our third quarter financial performance achieved a number of significant milestones and maintained the momentum generated during the first half of the year.”


Yaniv Arieli

“We produced record high gross margins, operating margins, and earnings per share through a combination of solid licensing pipeline, reflecting our excellent product portfolio, continued strength in our royalty business and a company-wide commitment to conservative financial management. At the end of the third quarter, our cash balance, marketable securities and bank deposits totaled approximately $156 million," reported Arieli.

CEVA, Inc. self-description

CEVA is the world's leading licensor of silicon intellectual property (SIP) DSP cores and platform solutions for the mobile handset, portable and consumer electronics markets. CEVA's IP portfolio includes comprehensive technologies for cellular baseband (2G / 3G / 4G), multimedia, HD video and audio, voice over packet (VoP), Bluetooth, Serial Attached SCSI (SAS) and Serial ATA (SATA). In 2010, CEVA's IP was shipped in over 600 million devices, powering handsets from 7 out of the top 8 handset OEMs, including Nokia, Samsung, LG, Motorola, Sony Ericsson and ZTE. Today, more than one in every three handsets shipped worldwide is powered by a CEVA DSP core. For more information, visit www.ceva-dsp.com.

 



CEVA Closing Price Nov 04 = $31.78
52 week range = $19.07 – $35.60
Market Cap = $743.7 million

 

Late News about CEVA

CEVA, Inc. Announces Upcoming Schedule of Events with the Financial Community

MOUNTAIN VIEW, Calif., Nov. 2, 2011 /PRNewswire/ --CEVA, Inc. (NASDAQ: CEVA); (LSE: CVA), the leading licensor of silicon intellectual property (SIP) platform solutions and DSP cores for the mobile handset, portable and consumer electronics markets, today announced that it will participate in the following upcoming conferences:

Where available, the company's presentation from these conferences will be streamed via audio webcast.

 

                                   

On October 27, 2011 MIPS Technologies, Inc. (NASDAQ: MIPS), a provider of industry-standard processor architectures and cores for digital home, networking and mobile applications, reported consolidated financial results for its first fiscal quarter of 2012 ended September 30, 2011, which is calendar Q3 2011 for EDA WEEKLY reporting purposes. All financial results are reported in US GAAP unless otherwise noted.

Summary of MIPS Q3 2011 Financial Metrics

Third quarter 2011 revenue from royalties was $13.0 million, while license revenue was $4.2 million.

The Company’s Q3 2011 GAAP net income was $0.523 million [or $0.01 per share], down 28.26% compared to $0.729 million [and $0.01 per share] in just-prior Q2 2011, and down 93.13% compared to $7.616 million [and $0.16 per share] in Q3 2010.



Sandeep Vij

“In the third calendar quarter, we achieved our forecast financial goals and continued to strengthen our solution offerings. While our financial performance in the quarter continues to mirror the overall consumer electronics and network infrastructure economic environment, we are confident in MIPS’ long-term market opportunity,” said Sandeep Vij, chief executive officer, MIPS Technologies.

                                                            
MIPS Technologies, Inc. self description


MIPS Technologies, Inc. (NASDAQ: MIPS) is a provider of industry-standard processor architectures and cores for digital home, networking and mobile applications. The MIPS architecture powers some of the world’s most popular products, including broadband devices from Linksys, DTVs and digital consumer devices from Sony, DVD recordable devices from Pioneer, digital set-top boxes from Motorola, network routers from Cisco, 32-bit microcontrollers from Microchip Technology and laser printers from Hewlett-Packard. Founded in 1998, MIPS Technologies is headquartered in Sunnyvale, California, with offices worldwide. For more information, contact (408) 530-5000 or visit www.mips.com.

MIPS is a trademark or registered trademark of MIPS Technologies, Inc. in the United States and other countries.

 



MIPS Closing Price Nov 04 = $5.63
52 week range = $3.87 – $18.19
Market Cap = $296.4 million


Late News about MIPS

MIPS Technologies ’Processor IP at the Heart of Sequans’ New LTE SoCs for Handsets and Tablets

MIPS-Based™ SoCs Recently Announced by Chipmaker with Leading Market Share in 4G Handset SoCs

SUNNYVALE, Calif. – October 27, 2011 – MIPS Technologies, Inc. (NASDAQ: MIPS), a provider of industry-standard processor architectures and cores for digital home, networking and mobile applications, announced that the new LTE (Long Term Evolution) SoC (System-on-Chip) from 4G chipmaker Sequans Communications S.A. (NYSE: SQNS) is powered by MIPS® industry-standard processors. Targeted at smart phones and tablets, the SQN3110 SoC is Sequans’ second generation LTE baseband chip. It incorporates dual MIPS32® 24Kc® processor cores, and is the first of a planned series of MIPS-Based LTE chips from Sequans.

LTE is a 4G wireless broadband technology that is quickly proliferating across the world. According to recent research from IHS iSuppli, growth of LTE infrastructure spending will reach $27.9 billion by 2014, a CAGR of a 107.5 percent from $1.5 billion in 2010. And research firm In-Stat forecasts that LTE subscriptions will experience an unprecedented 3,400% growth between 2011 and 2015. The MIPS® architecture is used widely in LTE network infrastructure solutions, and now through licensees such as Sequans, is gaining traction in user equipment (UE) such as handsets and tablets.

Implemented in an advanced 40nm process technology, the new SQN3110 SoC achieves LTE CAT4 data throughput with ultra-low power consumption. With Sequans’ 4G “slim modem” approach, the SoC provides high performance with compact area and low system cost. Compared with the previous generation LTE chip, the new MIPS-Based SoC features increased data throughput, 3GPP Release-9 support and improved power consumption.

“As the leading provider of 4G SoCs for handsets, Sequans leveraged its deep WiMAX and LTE experience to deliver this new SoC that offers key benefits for handsets and tablets. The SQN3110 SoC offers uncompromised performance in a low-power implementation with a high level of integration. MIPS’ flexible solutions and business model are enabling us to offer a broad range of options to our customers,” said Dr. Georges Karam, president and CEO, Sequans.

“MIPS Technologies continues to make inroads into the mobile market, with a growing presence in applications processing, baseband processing, and other mobile-related functionality. Sequans is clearly at the forefront of 4G chip development, with more than 10 million chipsets shipped to-date. We are pleased to team with Sequans as the company brings its high-performance, low-power MIPS-Based LTE chips to the world. The rapid adoption of 4G technologies provides a significant opportunity for Sequans to proliferate its products across the globe,” said Sandeep Vij, president and CEO, MIPS Technologies.

About Sequans Communications

Sequans Communications S.A. (NYSE: SQNS) is a 4G chipmaker, supplying LTE and WiMAX chips to original equipment manufacturers and original design manufacturers worldwide. Founded in 2003 to address the WiMAX market, the company expanded in early 2009 to address the LTE market. Sequans is based in Paris, France with additional offices throughout the world, including United States, United Kingdom, Israel, Hong Kong, Singapore, Taiwan, and China.

 

 

On November 3, 2011 MoSys, Inc. (NASDAQ: MOSY), a provider of serial chip-to-chip communications solutions that deliver unparalleled bandwidth performance for next generation networking systems and advanced system-on-chip (SoC) designs, reported poor financial results for the third quarter ended September 30, 2011.

Third Quarter and Recent Highlights

Management Commentary

“Revenue from license fees and royalties in the third quarter declined sequentially as our IP business was negatively impacted by global economic conditions and delays in customer acceptance of IP delivered under existing projects,” commented Len Perham, MoSys’ President and Chief Executive Officer.                                              

 


Len Perham

“Despite the current environment, we remain focused on further advancing our Bandwidth Engine family of ICs by continuing to engage with a growing list of prospective customers and partners. We recently achieved our first Bandwidth Engine design wins with two high-performance board suppliers. Additionally, the Bandwidth Engine IC is now being incorporated into system schematics at a number of design wins in progress with global networking equipment suppliers,” Perham continued.

“During the quarter, we continued to make progress successfully demonstrating the interoperability of our Bandwidth Engine IC with high-performance network processing ASICs, such as those available from Avago Technologies. This achievement expands on our current interoperability success with FPGA devices from both Altera Corporation and Xilinx. We continue to work with both the network equipment companies and their SOC suppliers to further expand the acceptance and use of our GigaChip™ Interface for serial chip-to-chip applications in their future generations of line cards. Finally, we have now fully defined our next generation IC, Bandwidth Engine 2, and it has been released to the design team. Bandwidth Engine 2 will include significant performance upgrades and feature enhancements. We are very enthusiastic about the ongoing adoption of our revolutionary Bandwidth Engine family of products and look forward to sharing this information as it becomes available,” concluded Mr. Perham.

MOSYS Third Quarter 2011 Results

Total net revenue for the third quarter of 2011 was just $2.107 million, compared with $3.292 million reported in the just-prior second quarter of 2011 and $3.776 million year-over-year in the third quarter of 2010.

To help put the poor revenue for Q3 2011 in perspective, revenue nine months YTD in 2011 is still $8.938 million, or $2.979 million per 2011 quarter, even when Q3 2011 is figured in. Revenue nine months YTD in 2010 was $11.595 million, or an average per 2010 quarter of $4.858 million.

GAAP net loss for the third quarter of 2011 was correspondingly huge at $6.868 million, or ($0.18) per share, compared with a GAAP net loss of $5.682 million, or ($0.15) per share, in the just-previous quarter and a net loss of $6.198 million, or ($0.19) per share, for the year-over-year third quarter of 2010.

Earnings per share for the third quarter of 2011 were computed using approximately 38.1 million shares on a GAAP basis.

 MoSys, Inc. self description

MoSys, Inc. (NASDAQ: MOSY) is a leading provider of high-performance networking memory solutions and high-speed, multi-protocol serial interface intellectual property (SerDes IP). MoSys' leading edge Bandwidth Engine® ICs combine the company's patented 1T-SRAM® high-density memory with its SerDes IP and are initially targeted at providing breakthroughs in bandwidth and access performance in next generation networking systems. MoSys’ SerDes IP and DDR3 PHYs support a wide range of data rates across a variety of standards, while its 1T-SRAM memory cores provide a combination of high-density, low-power consumption, high-speed and low cost advantages for high-performance applications. MoSys is headquartered in Santa Clara, California. More information is available on MoSys' website at www.mosys.com.

MoSys, 1T-SRAM and Bandwidth Engine are registered trademarks of MoSys, Inc. in the US and/or other countries. The MoSys logo is a trademark of MoSys, Inc. All other marks mentioned herein are the property of their respective owners.




MOSY Closing Price Nov 04 = $5.48
52 week range = $3.15 – $6.64
Market Cap = $132.48 million

 

News about MoSys


MoSys to Present at TechAmerica’s 2011 Classic Financial Conference on November 7, 2011

TechAmerica AEA Classic Financial Conference 2011

SANTA CLARA, Calif.--( BUSINESS WIRE)--MoSys, Inc., (NASDAQ: MOSY), a  provider of serial chip-to-chip communications solutions that deliver unparalleled bandwidth performance for next generation networking systems and advanced system-on-chip (SoC) designs, announced that the Company will present at TechAmerica’s 41st Annual The Classic Financial Conference at the Manchester Grand Hyatt in San Diego, California. Jim Sullivan, Chief Financial Officer, will conduct presentations and meet with investors on Monday, November 7, 2011, starting at 8:30 a.m. Pacific Time and concluding at 5:00 p.m.

About TechAmerica Financial Conference

The Classic serves as a financial catalyst for growth and innovation, enabling today’s leading tech companies to tap into capital, bolster investor interest, and strengthen shareholder value by bringing together growing public technology companies and technology focused investors. For more information on The Classic: www.techamerica.org/classic.

NOTE: This event will have occurred before press time of the November 14, 2011 posting of the EDA WEEKLY.



On October 20, 2011 Rambus Inc. (NASDAQ:RMBS), calling itself one of the world's premier technology licensing companies, reported financial results for the third quarter ended September 30, 2011.

Rambus Q3 2011 Business and Financial Highlights

Rambus GAAP Financial Results

Revenue for the third quarter of 2011 was $100.263 million, up 51% sequentially from the second quarter of 2011 [Q2 2011 revenue = $66.214 million], primarily due to the recognition of royalties from new licensing agreements signed in the second and third quarters of 2011. As compared to the third quarter of 2010, when revenue was only $31.743 million, Q3 2011 was up 216% primarily due to the revenue recognized from agreements signed since the third quarter of 2010.

Revenue for the nine months ended September 30, 2011 was $229.0 million, down 2% over the same period of last year, due to the recognition during the first quarter of 2010 of revenue from the settlement agreement signed with Samsung Electronics Co., Ltd. ("Samsung"), partially offset by the revenue recognized from agreements signed since the third quarter of 2010.

Total operating costs and expenses for the third quarter of 2011 were $89.5 million, which included general litigation expenses of $23.5 million, $7.2 million of stock-based compensation expenses and retention bonuses and amortization expenses related to the acquisition of Cryptography Research Inc. ("CRI") of $12.7 million. This is compared to total operating costs and expenses for the second quarter of 2011 of $68.7 million, which included general litigation expenses of $11.5 million, $7.0 million of stock-based compensation expenses and CRI related deal costs, retention bonuses and amortization expenses of $8.4 million. Total operating costs and expenses in the third quarter of 2010 were $43.2 million, which included general litigation expenses of $4.6 million, $7.5 million of stock-based compensation expenses and gain from the Samsung settlement of $10.3 million.

Total operating costs and expenses for the nine months ended September 30, 2011 were $212.4 million, which included a $6.2 million gain related to the Samsung settlement, $21.5 million of stock-based compensation expenses and $2.7 million for previous stock-based compensation restatement and related legal expenses. This is compared to total operating costs and expenses of $48.5 million for the same period of 2010, which included a $116.5 million gain related to the Samsung settlement, $23.2 million of stock-based compensation expenses and $3.4 million for previous stock-based compensation restatement and related legal expenses. General litigation expenses for the nine months ended September 30, 2011 were $44.2 million, an increase of $27.4 million from the same period in 2010.

Net income for the third quarter of 2011 was $0.478 million as compared to a net loss of $10.585 million in the second quarter of 2011 and a net loss of $20.576 million in the third quarter of 2010.

Diluted net income per share for the third quarter of 2011 was $0.00 as compared to a net loss per share of $0.10 in the second quarter of 2011 and a net loss per share of $0.18 in the third quarter of 2010.

Net loss for the nine months ended September 30, 2011 was $14.3 million as compared to a net income of $117.8 million for the same period of 2010. Diluted net loss per share for the nine months ended September 30, 2011 was $0.13 as compared to a net income per share of $1.01 for the same period of 2010.

Other Financial Highlights:

Cash, cash equivalents, and marketable securities as of September 30, 2011 were $292.7 million, a decrease of approximately $66.7 million from June 30, 2011. During the third quarter of 2011, Samsung exercised its “put option” in accordance with the terms of a stock purchase agreement dated January 19, 2010. As a result, the Company was required to repurchase 4.8 million shares of the Company's common stock for $100.0 million.

During the third quarter of 2011, the Company recorded an income tax provision of approximately $4.1 million. As the Company continues to maintain a full valuation allowance against its US deferred tax assets, the Company's tax provision consists of primarily withholding.

Rambus Inc. self description

Rambus is one of the world's premier technology licensing companies. As a company of inventors, Rambus focuses on the development of technologies that enrich the end-user experience of electronic systems. Additional information is available at www.rambus.com

 



RMBS Closing Price Nov 04 = $18.19
52 week range = $9.78 – $22.80
Market Cap = $2.04 Billion

 

 

Late News about Rambus

                           

Rambus Engineers Author Book on Signal Integrity

         

New book provides comprehensive overview of high-speed signaling for electronic system design

Sunnyvale, California, United States  - 10/25/2011   – Rambus Inc. (NASDAQ: RMBS), one of the world’s premier technology licensing companies,  announced that two of its engineers have authored a book titled “High-Speed Signaling: Jitter Modeling, Analysis, and Budgeting.”

As the speed of digital electronics increases, signal integrity is a critical issue that circuit and system design engineers must address. Signal integrity is the quality of an electrical signal as it travels between integrated circuits in an electronic system. This book offers key insights for technologists interested in state-of-the-art techniques for achieving the signal and power integrity required in today’s high-performance electronics.

“Rambus has a long history of innovation in many areas with a particular emphasis on high-speed, mixed-signal digital circuit and interface design in electronic systems,” said John Kent, vice president of Technology Development at Rambus. “As electronic devices push to gigabit data rates and beyond, understanding the methods of maintaining signal and power integrity is vital. By showcasing our collection of knowledge in this field, we can help advance the development of the next generation of electronic products.”

The authors, Dan Oh and Chuck Yuan along with several Rambus contributors, have spent years researching signal integrity and have published more than 100 papers on the subject. This book summarizes the current status of this evolving field and describes the latest advances in signal and power integrity. It offers circuit and system engineers techniques for the design of robust and efficient interface systems.


 



About the Authors

Dan Oh (below) is a senior principal engineer at Rambus Inc. He holds a Ph.D. in electrical engineering from the University of Illinois, Urbana-Champaign. Dr. Oh has published more than 80 papers and holds seven US issued patents and 10 pending patent applications in areas of high-speed link design. He serves on the technical program committee of IEEE EPEPS, and is a former member of the IEC DesignCon Technical Program Committee:


Chuck Yuan (below) is an engineering director at Rambus. He holds a Ph.D. in electrical engineering from Syracuse University. Dr. Yuan holds eight U.S. issued patents and has been published in over 100 journal and conference publications. Prior to joining Rambus, he worked as a senior consulting engineer at Cadence Design Systems:


Acknowledgement: The writer of this November 14, 2011 posting of the EDA WEEKLY would like to thank Ms. Juliet Niczewicz of The Hoffman Agency for providing the photos of the book authors used here, and for sending him a copy of the book in advance of its release. The writer has had an abiding interest in the field of signal integrity since the early 90’s when his Mentor Graphics’ PCB Division first released its High Speed Board Station software to the market incorporating automatic circuit board routing featuring cross-talk analysis.

More About Rambus Inc.

Rambus is one of the world’s premier technology licensing companies. Founded in 1990, the Company specializes in the invention and design of architectures focused on enriching the end-user experience of electronic systems. Rambus’ patented innovations and breakthrough technologies help industry-leading companies bring superior products to market. Rambus licenses both its world-class patent portfolio, as well as its family of leadership and industry-standard solutions. Headquartered in Sunnyvale, California, Rambus has regional offices in North Carolina, Ohio, India, Germany, Japan, Korea, and Taiwan. Additional information is available at www.rambus.com.

Very Breaking Rambus news

Since Rambus' fortunes are pivotal to the Electronics IP G5 discussed every three months in the EDA WEEKLY, this breaking news deserves to be noticed.

Rambus shares fell over 60% in value today.

Rambus investors were dealt this heavy blow on Wednesday November 16, 2011, after a court in San Francisco denied Rambus a win in Rambus' big price-fixing case against Micron and Hynix. After two months of deliberation, a jury found that Micron and Hynix were not guilty of price fixing or anti-competitive behavior. Rambus’s stock plunged almost $11 per share once the news was announced.

This was a major defeat for Rambus. Investors had apparently estimated that had it won the case, Rambus might have been able to collect anywhere from $300 million to as much as $4 billion.

It is not known if this verdict today will affect the previous settlement that Samsung had already made with Rambus.

The Collective Electronics IP G5 Results for Calendar Q3 2011

We have just completed our first look at the individual performances of each member of the Group of Five (a.k.a. the G5) Electronics IP players for nominal Q3 2011.

Promised thereafter was a summary of the by-now-familiar Tables of Revenues and Profits of the entire G5, this time of course for Q3 2011 (and the four quarters leading up to Q3 2011), as well as some graphs of previous year-by-year P&L’s. What follows, fulfils that promise!

First to Table 1 and the G5 Revenue Sum for Q3 2011: $326.74 million! Easily the largest revenue number in Table 1, due primarily to the 51%+ sequential revenue improvement by Rambus in Q3 2011 compared to Q2 2011. Indeed, the most recent quarter Q3 2011 came in some $17 million higher than the Q4 2010 Sum of $309.87 million, the most recent prior quarter in Table 1 when Rambus’ revenue was approaching $100 million. This mention of Rambus, of course, is not meant to ignore ARM, the behemoth that brought in 2.33 times the revenue in the last four quarters than did Rambus.

While ARM and Rambus revenues continue to dominate those of the remaining three G5 IP players by a huge factor, we’d be remiss if we ignored CEVA’s YOY revenue growth (Q3 11 vs. Q3 10) of some 39%, second only to…shucks…Rambus again, which delivered a massive 216% more in revenue than it did last year for Q3.

But CEVA is growing rapidly, and may soon pass MIPS, whose revenue continued to decline again in Q3 2011, at a falling revenue rate exceeding a million dollars per quarter for the last four quarters. But tiny MoSys keeps MIPS from the bottom of the G5 revenue chart, with MoSys declining revenue now standing at just $2.11 million for the third quarter of 2011. Moreover, Table 2 will reveal that MoSys is also running up massive losses on its income line totaling nearly $25 million in losses for the last four quarters. And MIPS is approaching red ink as well, and needs an immediate revenue turn-around or cost reduction to stay in the black).

But before we delve into the G5 profit picture too far, let's stay on the revenue chart of Table 1 a little longer. While ARM’s still-positive quarter to quarter revenue growth has shriveled to single-digit percentages, the revenue distinction among the five IP vendors continues, with two dominant vendors and three runners up. ARM’s strength is once more on display, with Rambus’ sinusoidal revenue still number two. While the business models of each these two vendors are dramatically different, together that “odd couple” again in Q3 2011 took some seven-eighths of the IP revenue Sum, leaving the last eighth or so to divide among the bottom three companies.

 

 

When one considers both Tables 1 and 2, ARM’s financials are indeed remarkable and serve as a model for all the G5 IP companies (or even for EDA and MCAD/MCAE vendors). Table 2 (below) reveals (a) that ARM’s net income exceeded $50 million in Q3 2011, and (b) that ARM sports all black numbers across the top row of Table 2. Moreover, the bar graph labeled “ARMH Graph I” shows that 2011 is not a new phenomenon:



Overall, Table 2 still shows lots of red; indeed, once again 40% of the entries in the IP G5 earnings table are in red font this third quarter of 2011. The earnings Tables 2 in both the two prior quarters (Q1 and Q2 2011) also sported an even 40.0% of red numbers.

Table 2 above also shows that in Q3 2011, despite reaching nine figures of revenue, Rambus ended up in Q3 2011 with precious little net income to show for it [+$478,000]. Again, nothing new here; Rambus’ business model simply marches to the beat of a different drummer; look at RAMBUS (USD) Graph V below:


The remaining three Google Finance graphs of would also appear to match the current 2011 personalities of the IP vendors each represents:


 

 

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About the Writer:

Since 1996, Dr. Russ Henke has been active as president of HENKE ASSOCIATES, a San Francisco Bay Area high-tech business & management consulting firm. The number of client companies served by Henke Associates during those years now numbers close to fifty and counting. Engagement lengths have varied from a few weeks up to ten years and beyond.

During his previous corporate career, Henke operated sequentially on "both sides" of MCAE/MCAD and EDA, as a user and as a vendor. He's a veteran corporate executive from Cincinnati Milacron (Research Scientist), SDRC (President & COO), Schlumberger Applicon (Executive VP), Gould Electronics (President & General Manager), ATP (Chairman and CEO), and Mentor Graphics (VP & General Manager).

Henke is a Fellow of the Society of Manufacturing Engineers (SME) and served on the SME International Board of Directors. Henke was also a board member of SDRC, PDA, ATP, and the MacNeal Schwendler Corporation, and he currently serves on the board of Stottler Henke Associates, Inc.

Henke is also a member of the IEEE and a Life Fellow of ASME International. In April 2006, Dr. Henke received the 2006 Lifetime Achievement Award from the CAD Society, presented by CAD Society president Jeff Rowe at COFES2006 in Scottsdale, AZ. In February 2007, Henke became affiliated with Cyon Research's select group of experts on business and technology issues as a Senior Analyst. This Cyon Research connection aids and supplements Henke's ongoing, independent consulting practice (HENKE ASSOCIATES). Dr. Henke is also a contributing editor of the EDACafé EDA WEEKLY, and he has published EDA WEEKLY articles every four weeks since November 2009; URL's available.

Since May 2003 HENKE ASSOCIATES has also published a total of one-hundred (100) independent COMMENTARY articles on MCAD, PLM, EDA and Electronics IP on IBSystems' MCADCafé and EDACafé.

Further information on HENKE ASSOCIATES, and URL's for past Commentaries and EDA WEEKLIES, are available at http://www.henkeassociates.net.

March 31, 2012 will mark the 16h Anniversary of the founding of HENKE ASSOCIATES.