Yes, it's a big deal, because it's the first profitable quarter ever for the long-suffering optical components company, Needham & Co. analyst John Harmon points out.
The fun might not last long, though. Bookham's forecast range for the December quarter says the company will still be teetering on the edge of breakeven, with earnings before interest, taxes, depreciation, and amortization (EBITDA) between negative $2 million and positive $2 million. (See Bookham Reports Q1.)
For the moment, though, Bookham has reason to celebrate, or at least to take a long ice cream break. For its first quarter, which ended Sept. 27, Bookham reported revenues of $66.5 million and net income of $2.2 million, or 2 cents per share, compared with the previous quarter's revenues of $62.6 million and net losses of $1.9 million, or 2 cents per share.
The numbers, and the EBIDTA prediction, match the forecast Bookham gave a couple of weeks ago. (See Bookham Narrows Forecast.)
Even if you don't count $6.5 million in intracompany currency adjustments, Bookham's quarter was in the black.
Bookham went public in 2000 and has piled up the losses ever since.
Table 1: Bookham's Losses
|Fiscal year||Net income (losses)|
|Source: SEC documents
* Fiscal year ended in December. Bookham's fiscal year now ends in June.
Growth areas for the first quarter, in order, were tunable products, amplifiers, and 980nm pump lasers, CEO Alain Couder said on last night's earnings call with analysts.
Margins on tunable lasers have finally risen to the industry average, he added. "The tunables are not a drag any more on the profitability of the telecom business."
The bad news is that three of Bookham's large North American customers have an oversupply of inventory, meaning they'll be buying less in the near future. That probably includes Nortel Networks Ltd. , which represented 18 percent of sales last quarter. (See Nortel Plunges on New Forecast.)
Gross margins will be down as well -- 21 to 26 percent, versus 26 percent in the first quarter, Bookham says. Analysts polled by Reuters Research are expecting non-GAAP losses of 1 cent per share for Bookham's second quarter.
Bookham's share price is around $0.62 a share, giving it a market capitalization of $62.85 million, even less than one quarter's worth of revenues. The company's stock has lost more than 80 percent of its value in the past 12 months.
— Craig Matsumoto, West Coast Editor, Light Reading