QLogic Reports First Quarter Results for Fiscal Year 2009

Tag : Component Adapters

QLogic Corp. (NASDAQ:QLGC), a leader in networking for storage andhigh performance computing (HPC), today announced its first quarterfinancial results for the period ended June 29, 2008.

Net revenue for the first quarter of fiscal 2009 was $168.4 millionand increased 20% from $139.8 million in the comparable quarterlast year. Revenue from Host Products, which are comprisedprimarily of Fibre Channel and iSCSI host bus adapters andInfiniBand host channel adapters, was $120.7 million during thefirst quarter of fiscal 2009 and increased 16% from $104.2 millionin the comparable quarter last year. Revenue from Network Products,which are comprised primarily of Fibre Channel and InfiniBandswitches, was $29.9 million during the first quarter of fiscal 2009and increased 22% from $24.5 million in the comparable quarter lastyear. Revenue from Silicon Products, which are comprised primarilyof protocol chips and management controllers, was $15.6 millionduring the first quarter of fiscal 2009 and increased 62% from $9.6million in the comparable quarter last year.

Net income on a GAAP basis for the first quarter of fiscal 2009 was$31.6 million, or $0.24 per diluted share, and increased from $19.0million, or $0.12 per diluted share for the first quarter of fiscal2008. Net income on a GAAP basis for the first quarter of fiscal2009 includes stock-based compensation expense, acquisition-relatedcharges, impairment charges related to marketable securities, andthe related income tax effects. Net income on a non-GAAP basis forthe first quarter of fiscal 2009 was $42.0 million, or $0.31 perdiluted share, and increased from $30.2 million, or $0.20 perdiluted share for the first quarter of fiscal 2008.

"We are very pleased with our strong financial performance and theachievement of record revenue during the first quarter," said H.K.Desai, QLogic's chief executive officer. "Our strong revenueperformance was driven by sequential growth of 9% for both our HostProducts and Network Products from the fourth quarter of fiscal2008."

QLogic uses certain non-GAAP financial measures to supplementfinancial statements based on GAAP. A summary of these non-GAAPfinancial measures and a reconciliation of each non-GAAP financialmeasure to the most directly comparable GAAP financial measure, aswell as a description of the reasons that management believes thatthese non-GAAP financial measures provide useful information toinvestors and the additional purposes for which management usesthese non-GAAP financial measures is presented in the accompanyingfinancial schedules.

QLogic's fiscal 2009 first quarter conference call is scheduled fortoday at 2:30 p.m. Pacific Time (5:30 p.m. Eastern Time). H.K.Desai, chief executive officer, and Simon Biddiscombe, senior vicepresident and chief financial officer, will host the conferencecall. The call is being webcast live via the Internet athttp://ir.qlogic.com and www.earnings.com. Phone access toparticipate in the conference call is available at (913) 312-1417,pass code: 4468628.

The financial information that the company intends to discussduring the conference call will be available on the company'swebsite at http://ir.qlogic.com for twelve months following theconference call. A replay of the conference call will be availablevia webcast at http://ir.qlogic.com for twelve months.

About QLogic

QLogic is a leading supplier of high performance storage networkingsolutions, which include the controller chips, host adapters andfabric switches that are the backbone of storage networks for mostGlobal 2000 corporations. The company delivers a broad and diverseportfolio of products that includes Fibre Channel adapters, bladeserver embedded Fibre Channel switches, Fibre Channel stackableswitches, iSCSI adapters and iSCSI routers. The company is also aleading supplier of InfiniBand switches and InfiniBand host channeladapters for the emerging high performance computing market. QLogicproducts are delivered to small-to-medium businesses and largeenterprises around the world via its channel partner community.QLogic products are also powering solutions from leading companiessuch as Cisco, Dell, EMC, Hitachi Data Systems, HP, IBM, NetApp andSun Microsystems. QLogic is a member of the S&P 500 Index.

Disclaimer - Forward Looking Statements

This press release contains statements relating to future resultsof the company (including certain beliefs and projections regardingbusiness trends) that are "forward-looking statements" as definedin the Private Securities Litigation Reform Act of 1995. Suchforward-looking statements are subject to risks and uncertaintiesthat could cause actual results to differ materially from thoseprojected or implied in the forward-looking statements. The companyadvises readers that these potential risks and uncertaintiesinclude, but are not limited to: potential fluctuations inoperating results; gross margins that may vary over time; revenuesmay be affected by changes in IT spending levels; the stock priceof the company may be volatile; the company's dependence on thestorage area network market; potential adverse effects of servervirtualization technology on the company's business; potentialadverse effects of increased market acceptance of blade servers;the ability to maintain and gain market or industry acceptance ofthe company's products; the company's dependence on a limitednumber of customers; seasonal fluctuations and uneven salespatterns in orders from customers; the company's ability to competeeffectively with other companies; declining average unit salesprices of comparable products; a reduction in sales efforts bycurrent distributors; dependence on sole source and limited sourcesuppliers; the company's dependence on relationships with certainsilicon chip suppliers; declines in the market value of thecompany's marketable securities; the complexity of the company'sproducts; sales fluctuations arising from customer transitions tonew products; environmental compliance costs; internationaleconomic, regulatory, political and other risks; uncertain benefitsfrom strategic business combinations; the ability to attract andretain key personnel; difficulties in transitioning to smallergeometry process technologies; the ability to protect proprietaryrights; the ability to satisfactorily resolve any infringementclaims; reliance on third party technology; the use of "opensource" software in the company's products; changes in thecompany's tax provisions or adverse outcomes resulting fromexamination of its income tax returns; computer viruses and othertampering with the company's computer systems; and facilities ofthe company and its suppliers and customers are located in areassubject to natural disasters.

More detailed information on these and additional factors whichcould affect the company's operating and financial results aredescribed in the company's Forms 10-K, 10-Q and other reportsfiled, or to be filed, with the Securities and Exchange Commission.The company urges all interested parties to read these reports togain a better understanding of the business and other risks thatthe company faces. The forward-looking statements contained in thispress release are made only as of the date hereof, and the companydoes not intend to update or revise these forward-lookingstatements, whether as a result of new information, future eventsor otherwise.

Non-GAAP Financial Measures

The non-GAAP financial measures contained herein are a supplementto the corresponding financial measures prepared in accordance withgenerally accepted accounting principles (GAAP). The non-GAAPfinancial measures presented exclude the items summarized in theabove table. Management believes that adjustments for these itemsassist investors in making comparisons of period to periodoperating results and that these items are not indicative of thecompany's on-going core operating performance.

The company has presented non-GAAP net income and non-GAAP netincome per diluted share, on a basis consistent with its historicalpresentation, to assist investors in understanding the company'score net income and core net income per diluted share on anon-going basis. These non-GAAP financial measures may also assistinvestors in making comparisons of the company's core netprofitability with historical periods and comparisons of thecompany's core net profitability with the corresponding results forcompetitors. Management believes that non-GAAP net income andnon-GAAP net income per diluted share are important measures in theevaluation of the company's profitability. These non-GAAP financialmeasures exclude the adjustments described in the above table, andthus provide an overall measure of the company's on-going netprofitability and related profitability on a diluted per sharebasis.

Management uses non-GAAP net income in its evaluation of thecompany's core after-tax results of operations and trends betweenfiscal periods and believes that this measure is an importantcomponent of its internal performance measurement process. Inaddition, the company prepares and maintains its budgets andforecasts for future periods on a basis consistent with thisnon-GAAP financial measure. Management believes that providingthese non-GAAP financial measures allows investors to view thecompany's financial results in the way that management views thefinancial results.

The non-GAAP financial measures presented herein have certainlimitations in that they do not reflect all of the costs associatedwith the operations of the company's business as determined inaccordance with GAAP. Therefore, investors should consider non-GAAPfinancial measures in addition to, and not as a substitute for, oras superior to, measures of financial performance prepared inaccordance with GAAP. The non-GAAP financial measures presented bythe company may be different from the non-GAAP financial measuresused by other companies.

For additional information on the items excluded from the non-GAAPfinancial measures and why the company believes that these non-GAAPfinancial measures provide useful supplemental information toinvestors, the company refers you to the Form 8-K regarding thisrelease filed today with the Securities and Exchange Commission.