Cabling Problem Impacts Mellanox Results
January 3, 2013
Mellanox Technologies said a cabling problem has affected its results and that fourth quarter revenue would likely come in well under original projections.
The supplier of switches, cables and adapters for high-speed financial networks had originally estimated revenue at $145 million to $150 million. The Sunnyvale, Calif., manufacturer is now projecting revenue to be in the range of $119 million to $121 million.
Based on the higher projections, the firm had estimated 2012 annual revenue of approximately $500 million, up from $259 million in 2011.
In a statement, the company says the shortfall is primarily the result of a weaker demand environment, challenging macroeconomic conditions, and a technical issue associated with the firm’s FDR InfiniBand 56 gigabits a second cabling which caused approximately $20 million of deployments to be delayed. The cabling issue has been resolved and is not expected to impact revenue in the future, Mallanox claims.
The company says it continues to expect its fourth quarter 2012 non-GAAP gross margin to be in the range of 68.5 to 69.5 percent and a quarter-over-quarter sequential increase in non-GAAP operating expenses of six to eight percent.
The Nasdaq Stock Market Wednesday halted trading in Mellanox shares pending the announcement.
Mellanox plans to conduct a conference call on Wednesday, January 23, 2013 at 2 p.m. Pacific Time to discuss the company's fourth quarter 2012 financial results.
The call will be available via live webcasts on the investor relations section of the Mellanox website.