AMCC Snacks on Cicada Scraps
The purchase, for an undisclosed amount, was completed during AMCC's first quarter, which ended June 30. CEO David Rickey announced the deal during the company's earnings call yesterday.
AMCC is acquiring the LIU product line and intellectual property -- but no employees -- with the intent of integrating the technology into framer chips. The first combined products should be announced by year's end, said Brent Little, AMCC's senior vice president of marketing, during the call.
Cicada, best known for Gigabit Ethernet PHYs, introduced the LIU product line last year (see Cicada Unveils PHY Transceiver and Cicada Intros DSP-Based LIUs).
A Cicada spokeswoman notes that the transaction doesn't mean other parts of the company are up for sale. Cicada is just "selling a little bit of our IP [intellectual property] for a little additional cash," she says. The startup's most recent funding was a $17.4 million round roughly a year ago (see Cicada Semi Scores $17.4M).
For the quarter ended in June, AMCC reported losses of $53.4 million, or 18 cents per share, on revenues of $20.5 million, compared with losses of $405 million, $1.35 per share, on revenues of $30.2 million for the same quarter a year ago (see AMCC Revenues, Losses Down in Q1).
Business was up slightly from the March 2003 quarter, and communications products saw a book-to-bill ratio of 1.5. (The ratio compares incoming orders with fulfilled orders; anything greater than 1.0 indicates business is growing.) Executives also said they expect this quarter's revenues to be 10 to 12 percent higher than last quarter's.
But that's not necessarily a sign of recovery, warns analyst Jeremey Bunting of Thomas Weisel Partners. Earlier this week, Bunting was noting that recent boosts in telecom-chip sales were probably due to inventory replenishment rather than real demand -- and given yesterday's gloomy announcement from Lucent, he's sticking to that theory.
"We're not convinced that this momentum is sustainable," Bunting wrote in a report following AMCC's call. (It's worth noting that he does see strong demand for broadband- and enterprise-related chips.)
AMCC officials also noted that the company's restructuring is ahead of schedule. AMCC had announced a goal to trim headcount to 626 from a December figure of 912 (see AMCC Restructures, Lays Off). As of June 30, the company already was down to 621 employees.
— Craig Matsumoto, Senior Editor, Light Reading