Financial

posted on 04 August 2008 14:00

Solid state drive (SSD) supplier STEC has announced strong quarterly revenue growth and slightly increased net income for its second 2008 quarter.

GAAP results in Q2 08 include start-up costs related to the Company's Malaysia facility, costs related to its global tax restructuring and the corresponding short-term impact of this restructuring on the Company's effective tax rate and employee stock compensation expense.

GAAP gross profit margin was 32.3% for Q2 08, compared to 31.3% for the Q2 07, and 32.9% for Q1 08.

For the first half of 2008 (H1 08) STEC revenues were $106.89 million, compared to $90.94 million in the year-ago period.

Half yearly net income was $3.259 million ($0.07/share) compared to H1 07's $8.076 million ($0.16/share).

STEC CEO Manouch Moshayedi said: "We are very pleased with our results for the second quarter of 2008 having surpassed our second quarter revenue and non-GAAP diluted earnings per share guidance. The execution of our Solid State Drive initiatives in four major markets - Enterprise Storage, Enterprise Server, Notebook and Ultra-Mobile Notebook - positively impacted second quarter of 2008 results and we expect continued growth in subsequent quarters."

"In addition, we have recently closed a $35 million revolving credit facility. This facility will add to our liquidity and enable us to manage the future growth of our business. Furthermore, this financing comes with a relatively low cost of capital and is considerably less dilutive to our shareholders than an equity offering."

Outlook

Moshayedi added: "We currently expect third quarter of 2008 revenue to range from $61 million to $63 million with diluted non-GAAP earnings per share to range from $0.10 to $0.11. Additionally, in light of our mounting design win activity at key customers, we believe we will continue to have strong performance into the fourth quarter of 2008 with double-digit growth from the third quarter of 2008. This momentum will carry us into the first quarter of 2009 and even beyond."

^{[Chris Mellor.]}