http://www.morningstar.com/earnings/29471202-marvell-technology-group-ltd-mrvl-q2-2012.aspx

Marvell Technology Group Ltd MRVL
Q2 2012 Earnings Call Transcript

Transcript Call Date 08/18/2011

Operator: Good day, ladies and gentlemen, and welcome to the Second Quarter 2012 Marvell Technology Group Limited Earnings Conference Call. My name is Schanel, and I’ll be your operator for today. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session. As a reminder, this conference is being recorded for replay purposes.

I would now like to turn the conference over to Mr. Sukhi Nagesh. Please proceed.

Sukhi Nagesh - VP, IR: Thanks you, Schanel, and good afternoon, everyone. Welcome to Marvell Technology Group second quarter fiscal 2012 earnings call. I am Sukhi Nagesh, Vice President of Investor Relations. With me on the call today are Sehat Sutardja, Marvell's CEO; and Clyde Hosein, Marvell's CFO. We will all be available during the Q&A portion of the call today.

If you have not obtained a copy of our current press release, it can be found at our Company’s website under the Investor Relations section at marvell.com. Additionally, this call is being recorded and will be available for replay from our website.

Please be reminded that this call will include forward-looking statements that involve risks and uncertainties that could cause our results to differ materially from management's current expectations. The risks and uncertainties include our expectations about sales of new and existing products, including statements about our TD, HDD and SSD products, statements about general trends and the end markets we serve, statements regarding our financial projections for the third quarter of fiscal 2012, and our expectations about long-term growth.

To fully understand the risks and uncertainties that may cause results to differ from our expectations and outlook, please refer to today’s earnings release, our latest quarterly report on Form 10-Q, and subsequent SEC filings for a detailed description of our business and associated risks. Please be reminded that all of our statements are made as of today and Marvell undertakes no obligation to revise or update publicly any forward-looking statements.

During our call today, we will make reference to certain non-GAAP financial measures, which include stock-based compensation expense, as well as charges related to acquisitions, restructuring, gains and other charges that are driven primarily by discrete events that management does not consider to be directly related to our core operating performance.

Pursuant to Regulation G, we have provided reconciliations of the non-GAAP financial measures to the most directly comparable GAAP measures in our fiscal second quarter earnings press release, which has been furnished to the SEC on Form 8-K, and is available on our website in the Investor Relations section.

With that, I would now like to turn the call over to Sehat.

Dr. Sehat Sutardja - Chairman, President and CEO: Thanks, Sukhi, and good afternoon, everyone. Today we reported second quarter fiscal 2012 revenues of approximately $898 million, reflecting a 12% sequential increase from the prior quarter. We delivered non-GAAP gross margin of 58.1%, non-GAAP operating margin of 26% and non-GAAP earnings per share of $0.38. We generated free cash flow of approximately $235 million, equivalent to a 26% free cash flow margin. Our revenue results were at the high end of our guidance range, and we continue to deliver strong profitability and cash flow generations driven by revenue and share growth in all of our served end markets.

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