Feeds

QLogic quarterly revenues down

But it turns a profit

Next gen security for virtualised datacentres

QLogic's first fiscal 2010 revenues were 27 per cent down at $122.8m with net income down 53 per cent to $15m - but at least it was a profit.

Comparisons with the year-ago quarter are all bad. Host products revenues - the HBAs - showed a 27 per cent drop to $88.3m, network products - FC and InfiniBand switches - recorded a 16 per cent drop to $25.0m, and silicon products fell 52 per cent to $7.4m.

Compared to the previous quarter, though, the results are much better. H K Desai, QLogic's CEO, said: "On a sequential basis, revenue from host products and netware products was flat and revenue from silicon products was down 46 per cent.

He thinks the financial outlook is improving: "Despite the fact that we continue to experience effects of the broad macroeconomic slowdown, we are encouraged by the signs of stability we are seeing. This includes a number of factors.

"First, we are seeing signs of stability in our business with our key OEM customers. Second, variety of spending in the second half of our calendar year 2009 and 2010 has stopped eroding and in certain cases has started to improve."

According to the earnings call transcript, Desai reckons QLogic has the largest installed base of Fibre Channel HBAs, with the lead increasing in the quarter: "QLogic achieved over 56 per cent revenue market share in Fibre Channel adaptors, a full 19 point lead over our nearest competitor (Emulex). This is the widest lead we have in our history."

He asserts that this installed base represents a great opportunity for QLogic's Converged Network Adapters (CNA) that run the Fibre Channel over Ethernet (FCoE) protocol. Customers will also need more and better adapters as they refresh their servers to take advantage of Intel Nehalem chips and virtualisation.

Desia sees much better financial weather ahead: "We are seeing clear signs of stableness within our business and this is reflected in the revenue performance of our host and network products in the first fiscal quarter and in our revenue guidance for the September quarter."

The guidance is for the next quarter's revenues to be $123m - $127m, which would be down 26 per cent - 28 per cent year-on-year but much better sequentially. QLogic, like Seagate, sees the recession bottoming out. But Desai sees flat revenues in the silicon business over the next three or so quarters.

A rise in SAS hard drive shipments will probably reduce demand for FC to SATA bridge chips and so affect QLogic's silicon business.

Analysts asked if Desai would consider licensing QLogic's FCoE technology to a competitor, meaning Broadcom, hungry for FCoE technology after being rebuffed in its Emulex takeover attempt. He replied: "If they can give us a billion dollars, I probably can license my Fibre Channel. I’m talking billion, not million." ®

The essential guide to IT transformation

More from The Register

next story
The Return of BSOD: Does ANYONE trust Microsoft patches?
Sysadmins, you're either fighting fires or seen as incompetents now
Microsoft: Azure isn't ready for biz-critical apps … yet
Microsoft will move its own IT to the cloud to avoid $200m server bill
Oracle reveals 32-core, 10 BEEELLION-transistor SPARC M7
New chip scales to 1024 cores, 8192 threads 64 TB RAM, at speeds over 3.6GHz
US regulators OK sale of IBM's x86 server biz to Lenovo
Now all that remains is for gov't offices to ban the boxes
Object storage bods Exablox: RAID is dead, baby. RAID is dead
Bring your own disks to its object appliances
Nimble's latest mutants GORGE themselves on unlucky forerunners
Crossing Sandy Bridges without stopping for breath
prev story

Whitepapers

Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
7 Elements of Radically Simple OS Migration
Avoid the typical headaches of OS migration during your next project by learning about 7 elements of radically simple OS migration.
BYOD's dark side: Data protection
An endpoint data protection solution that adds value to the user and the organization so it can protect itself from data loss as well as leverage corporate data.
Consolidation: The Foundation for IT Business Transformation
In this whitepaper learn how effective consolidation of IT and business resources can enable multiple, meaningful business benefits.
High Performance for All
While HPC is not new, it has traditionally been seen as a specialist area – is it now geared up to meet more mainstream requirements?