Commenting on the third quarter results, Scott Grout, RadiSys President and CEO stated, “Revenues were in line with our projections, and we delivered better than expected gross margins, earnings, and cash flow in the third quarter as a result of continued cost improvements in our operations. In addition, we had another strong design win quarter with several notable awards including a win with a new North American Tier 1 customer that plans to use our ATCA platform for their Wireless Messaging application, and a win with a China based Tier 1 customer that plans to use our media server in a new Video Gateway application. Within our operations and engineering organizations, we are making very good progress on the previously announced initiatives to increase our operational efficiency and global capabilities that will expand our operating margins over time.”
Third Quarter Financial Highlights
- Revenue was $70.4 million, down 29.7% from the same quarter in the prior year, which was the Company’s record revenue quarter. As anticipated, the Company’s traditional wireless and commercial businesses were down from the prior year due to general market softness.
- GAAP gross margin was 29.4%, up 2.8 percentage points year-over-year. Non-GAAP gross margin was 32.1%, up 1.4 percentage points year-over-year, mainly due to favorable product mix as well as improved manufacturing and operational costs.
- Total GAAP R&D and SG&A expenses were $21.0 million, down $3.7 million or 14.9% from the same quarter last year and $0.8 million from the prior quarter. Non-GAAP R&D and SG&A expenses were $19.3 million, down $3.3 million or 14.4% from the same quarter last year and down $0.8 million from the prior quarter.
- GAAP operating loss was $1.1 million. Non-GAAP operating income was $3.4 million or 4.8% of revenue.
- Cash flow from operating activities was $2.3 million and cash and cash equivalents were $92.1 million at the end of the third quarter.