Micrel, Inc. announced financial results for the third quarter ending September 30, 2007. Third quarter revenues were $65.2 million, up slightly from $65.1 million in the second quarter, and 11% lower than the $73.5 million posted in the year-ago period.
Third quarter GAAP net income was $9.4 million, or $0.12 per diluted share. This compares with second quarter 2007 GAAP net income of $8.6 million, or $0.11 per diluted share, and GAAP net income of $11.8 million, or $0.15 per diluted share, in the year ago period. Included in the third quarter 2006 financial results were $2.9 million of revenue and $714,000 in cost of revenues related to settlement of intellectual property matters, which increased third quarter 2006 GAAP net income by $0.02 per diluted share.
Third quarter 2007 non-GAAP net income was $10.5 million or $0.14 per diluted share. This compares to non-GAAP net income of $10.1 million, or $0.13 per diluted share in the previous quarter and $12.3 million, or $0.15 per diluted share in the third quarter of 2006.
"Driven by strong gross margins and cost control, Micrel’s third quarter financial results improved on a sequential quarter basis," stated Ray Zinn, President and CEO of Micrel. "While revenues were up slightly on a sequential basis, third quarter revenues were less than we forecasted at the beginning of the quarter. During the third quarter, revenues from customers serving the wireless handset and consumer end markets increased but were offset by weaker than expected demand from customers in the wireline communications end market. However, I was pleased with our operating execution during the quarter, including the sequential improvement in gross margin and lower inventory levels. As a result, GAAP income from operations, net income and earnings per share each increased over second quarter levels. The company continues to generate solid cash flows from operations, which enabled the repurchase of approximately 1.9 million shares of Micrel common stock during the quarter."
The company also reported that its Board of Directors has approved a $50 million share repurchase program for calendar year 2008. The new share repurchase plan will take effect after the company’s previously authorized 2007 share repurchase program terminates on December 31, 2007. Repurchases may occur from time to time in the open market or in privately negotiated transactions through December 31, 2008. The timing and amount of any repurchase of shares will be determined by the company’s management, based on its evaluation of market conditions and other factors.
