Mellanox outstrips all expectations

The company's share price is soaring after it raised guidance, and reported second quarter profit far above analysts' estimates.

Rapid enterprise communications technology solutions company Mellanox Technologies Ltd. (Nasdaq:MLNX; TASE:MLNX) surpassed all expectations in its second quarter results published last night. Revenue was $133.5 million, up 50% from the preceding quarter, and up 111% from the corresponding quarter of 2011. Analysts expectations had been $128 million.

Non-GAAP profit in the second quarter of 2012 was $42.9 million ($0.99 per share),compared with $22.0 million ($0.51 per share) in the preceding quarter of 2012, and $10.3 million ($0.27 per share) in the corresponding quarter of 2011. Analysts expectations had been $0.74 per share.

This was the second consecutive quarter in which the InfiniBand high-performance technology developer had easily outstripped the analysts' forecasts.

Mellanox also upped its guidance for the third quarter predicting revenue of $150-155 million, which would be 120% up on the corresponding quarter of 2011 and mean annual revenue of $600 million.

Mellanox CEO Eyal Waldman said, "We benefited from growth in high-performance computing, Web 2.0, storage, database, cloud, big data and financial services markets. We believe this growth demonstrates the broader market acceptance of both our FDR 56Gb/s InfiniBand and 10 and 40 Gigabit Ethernet solutions. More customers realize that ‘fast interconnect’ provides them with a higher return-on-investment and lower total cost of ownership."

Speaking generally about Mellanox's performance he added, "We are seeing the growth that we said would happen."

Mellanox's share price had fallen by nearly 20% over the past two weeks but following yesterday's results the share price rose 43.3% to $95.15 in after-market trading on Nasdaq. During trading, the share had risen 6.65% to $66.38, giving a market cap of $2.69 billion.

Published by Globes [online], Israel business news - - on July 19, 2012

© Copyright of Globes Publisher Itonut (1983) Ltd. 2012

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