PowerDsine™ Ltd. announced financial results for the second quarter ended June 30. For the second quarter of 2006, sales were $8.3 million, compared to sales of $10.5 million for the second quarter of 2005 and $7.4 million for the first quarter of 2006. The company reported a net loss for the second quarter of 2006 of $1.6 million, or $0.08 per share, compared to a net profit of $757,000, or $0.04 per diluted share, for the second quarter of 2005 and a net loss of $4.3 million, or $0.22 per share, for the first quarter of 2006.
Non-GAAP net loss, excluding non-cash stock-based compensation expenses totaling $1.3 million, was $301,000, or $0.01 per share, compared to non-GAAP net income for the second quarter of 2005 of $1.3 million or $0.06 per share, and non-GAAP net loss for the first quarter of 2006 of $2.0 million, or $0.09 per share. Stock-based compensation expense for the first quarter of 2006 and second quarter of 2005 was $813,000 and $538,000, respectively. Non-GAAP net loss for the first quarter of 2006 does not include restructuing expenses of approximately $1.5 million recognized during the quarter.
Operating expenses for the second quarter were $6.5 million, compared to $7.2 million in the first quarter of 2006. The reduction in operating expenses reflects the initial cost savings realized as a result of the cost cutting measures undertaken in the first quarter. As of June 30, 2006, cash, cash equivalents, short term and long-term investments totaled $73.6 million. The weighted average shares outstanding for the second quarter of 2006 were 19.93 million.
Commenting on the results, Igal Rotem, Chief Executive Officer of PowerDsine, said, "We are very pleased with our results for the second quarter, which reflect growth in our embedded business, stability in our midspan business and the initial benefits of our restructuring. With a streamlined infrastructure and rationalized cost structure now in place, we are well positioned to capitalize fully on the opportunities that exist in the market. Additionally, we have the available resources to leverage our Silicon and Power Management expertise to develop a new innovative product line."
"We are witnessing a ramp-up of PoE-enabled switches based on our technology entering mass production as well as strong growth in the number of PoE enabled end-devices. The combination of these factors is driving the maturity of Power over Ethernet technology. We believe that the maturity of the PoE market will further assist PowerDsine to maintain its position as one of the leaders of the PoE industry."
