Mellanox® Technologies, Ltd. (NASDAQ: MLNX), a leading supplier of high-performance, end-to-end interconnect solutions for data center servers and storage systems, today announced preliminary financial results for its first quarter ended March 31, 2019.
“Mellanox delivered record revenue in Q1, achieving 5 percent sequential growth and 22 percent yearover-year growth. All of our product lines grew sequentially, showing the benefits of our diversified data center strategy," said Eyal Waldman, president and CEO of Mellanox Technologies. “Our R&D execution has resulted in differentiated products, while at the same time we have generated operating margin of 14.6% on a GAAP basis and 28.3% on a non-GAAP basis. Additionally, we increased cash and short-term investments by $114 million during the quarter.”
“Across InfiniBand and Ethernet product lines, our innovations are driving continued market leadership. Our 200 gigabit HDR InfiniBand solutions are enabling the world’s fastest supercomputers and driving our overall InfiniBand growth. During Q1, HDR InfiniBand connected tens-of-thousands of compute and storage end-points across supercomputing, hyperscale, and cloud data centers around the globe to achieve breakthrough performance. Our Ethernet solutions continue to penetrate the market for both adapters and switches. Our market leadership in 25 gigabit per second Ethernet solutions is well established, and our 100 gigabit per second solutions are the fastest growing portion of our Ethernet adapter product line. We are also encouraged by the adoption of our BlueField System-on-a-Chip and SmartNIC technology. With further innovations to come, Mellanox is well-positioned to continue its growth trajectory,” Mr. Waldman concluded.
First Quarter 2019 - Highlights
- Revenue of $305.2 million in the first quarter, an increase of 21.6 percent, compared to $251.0 million in the first quarter of 2018.
- GAAP gross margins of 64.6 percent in the first quarter, compared to 64.5 percent in the first quarter of 2018.
- Non-GAAP gross margins of 68.0 percent in the first quarter, compared to 69.0 percent in the first quarter of 2018.
- GAAP operating income of $44.7 million in the first quarter, compared to $12.0 million in the first quarter of 2018.
- Non-GAAP operating income of $86.3 million in the first quarter, or 28.3 percent of revenue, compared to $52.1 million, or 20.8 percent of revenue in the first quarter of 2018.
- GAAP net income of $48.6 million in the first quarter, compared to $37.8 million in the first quarter of 2018.
- Non-GAAP net income of $86.5 million in the first quarter, compared to $51.4 million in the first quarter of 2018.
- GAAP net income per diluted share of $0.87 in the first quarter, compared to $0.71 in the first quarter of 2018.
- Non-GAAP net income per diluted share of $1.59 in the first quarter, compared to $0.98 in the first quarter of 2018.
- $88.4 million in cash provided by operating activities in the first quarter, compared to $55.4 million in the first quarter of 2018.
- Cash and investments totaled $552.6 million at March 31, 2019, compared to $438.5 million at December 31, 2018.
Commentary regarding Mellanox Acquisition by NVIDIA
As announced on March 11, 2019, NVIDIA Corporation intends to acquire all the issued and outstanding common shares of Mellanox for $125 per share in cash. The acquisition will unite NVIDIA’s strength in accelerated computing with Mellanox’s expertise in high-performance interconnect technology to address the data center market, better serve our customers, and accelerate innovation. Due to the pending acquisition, Mellanox will not hold an earnings conference call and has suspended the practice of providing forward-looking guidance.
Recent Mellanox Press Release Highlights
- March 18, 2019 - Mellanox HDR 200G InfiniBand Deep Learning Acceleration Engines Demonstrates Two Times Higher Performance for Artificial Intelligence (AI) Platforms with NVIDIA
- March 12, 2019 - Mellanox Introduces Breakthrough NVMe SNAP™ Technology to Simplify Composable Storage
- March 11, 2019 - Mellanox and NVIDIA Corporation jointly announce entry into a definitive agreement and plan of merger
- March 5, 2019 - Mellanox Showcases Live System Demonstrations of LinkX™ 200G & 400G Cables & Transceivers at OFC 2019
- March 4, 2019 - Mellanox Propels JD Cloud to New Levels of Performance and Efficiency
- February 25, 2019 - HDR 200G InfiniBand Sets New Performance Records, Accelerating Multiple High-Performance Computing and Artificial Intelligence Platforms Around the World
- January 30, 2019 - Mellanox Delivers Record Fourth Quarter and Annual 2018 Results, Exceeded $1 Billion in Annual Revenue in 2018
- January 22, 2019 - CSC, the Finnish IT Center for Science, and the Finnish Meteorological Institute Select 200 Gigabit HDR InfiniBand to Accelerate Multi-Phase Supercomputer Program
- January 7, 2019 - Mellanox 200 Gigabit HDR InfiniBand to Accelerate a World-Leading Supercomputer at the High-Performance Computing Center of the University of Stuttgart (HLRS)
- January 3, 2019 - Mellanox to Report Fourth Quarter 2018 Financial Results on January 30, 2019
Note: See attached download for complete financial results.