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February 08, 2010

NEI: First Fiscal Quarter 'Sets the Stage' For a Strong Year

By Marisa Torrieri, TMCnet Editor

NEI, a provider of server-based application platforms, appliances and support services for software developers and OEMs worldwide, recently posted its financial results for its first fiscal quarter, the period ending Dec. 31, 2009.
NEI reported net revenues of $43.9 million, at “the high end of the company’s guidance of $39 to $44 million,” and an increase of 8 percent compared sequentially to the $40.7 million in the fourth fiscal quarter of 2009 and 18 percent compared to the $37.2 million for the first quarter of the prior year.
The increase both sequentially and year-over-year was due to increased volume from certain customers and the initial contribution from the two significant design wins from fiscal 2009, according to the Canton, Mass.-based company.
Gross profit was 13.7 percent of net revenues, within the guidance of 13.5 to 15 percent and compared sequentially to 15 percent in the fourth fiscal quarter of 2009 and compared to 15.1 percent for the first quarter of prior fiscal year.
During this quarter NEI added eight new design wins, compared to 11 design wins in the first quarter of fiscal 2009. NEI now tracks design wins as only those with new customers, or with entirely disparate divisions within existing customers, representing a change from last year.
Applying that same criteria to previous results, NEI had five first quarter design wins last year. Two of the eight design wins this quarter were run rate customers.
“The first fiscal quarter was a positive quarter for us, and it sets the stage for a strong year,” said Greg Shortell, president and CEO of NEI. “We met or exceeded guidance once again, and showed both sequential and year-over-year improvements in revenue and net income while maintaining a strong balance sheet. As expected, the significant design win with our largest customer announced in the fourth fiscal quarter last year began to contribute to our results in the December quarter, and we expect this to ramp to more than $10 million per quarter in incremental revenue in the coming quarters. We continue to pursue high-volume run-rate opportunities.”

Marisa Torrieri is a TMCnet Web editor, covering IP hardware and mobility, including IP phones, smartphones, fixed-mobile convergence and satellite technology. She also compiles and regularly contributes to TMCnet's gadgets and satellite e-Newsletters. To read more of Marisa's articles, please visit her columnist page.

Edited by Marisa Torrieri

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