Transmeta reported a first-quarter loss of $13.2 million, or 10 cents per share, on revenue of $18.6 million, excluding amortization of deferred charges. Santa Clara, Calif.-based Transmeta reported a loss of $16.7 million, or 56 cents per share, in the same quarter last year.
A consensus of analysts had expected the chipmaker to post a loss of 11 cents per share, according to First Call.
Its revenue grew 50 percent in the first quarter compared with the fourth quarter. But the company's forecast for current-quarter growth isn't quite as riveting.
"We currently expect that revenue will be similar or slightly up" from the first quarter, Merle McClendon, Transmeta's chief financial officer, said on a conference call.
Still, the CEO said the company expects a good year.
"Overall, we're very bullish on the year," CEO Mark Allen said. "I'm encouraged by where we are with our new products."
This is the company's second quarter of reporting since its initial public offering in November.
Including amortization, Transmeta lost $22.7 million, or 18 cents per share, in the first quarter.
Transmeta chips work by emulating the x86 set of instructions used by PC chips from Intel and Advanced Micro Devices. Transmeta's code-morphing software translates data used by x86 applications and operating systems into instructions that Transmeta's processor understands.
The chipmaker counts Fujtisu, Hitachi, Sony, NEC and a handful of other PC makers as its customers.
The executives said two new PC makers will release notebooks with Crusoe chips in the second quarter in Japan. One of those companies will release a Crusoe-based product in North America in the third quarter.
Transmeta is also planning a new chip, due out late in the second quarter, that it says will outdo Intel's power-saving chips.
This new TM 5800 chip will use the less power-hungry 0.13-micron manufacturing process. Customers have samples now, company executives said, and initial shipments will begin at the end of the second quarter.
Transmeta expects that PC makers will pair the chip--expected at speeds of 700MHz to 800MHz--with double data rate SDRAM memory and a new version of its code-morphing software, dubbed CMS 4.2. Altogether, the three elements can cut power consumption up to 50 percent, compared with its current TM 5600 processors, Transmeta executives said.
As it increases production, Transmeta will draw more chips from a new manufacturing partner, Taiwan Semiconductor Manufacturing Co. IBM currently manufactures the lion's share of Transmeta chips.
Still, Transmeta has its work cut out for it. The chipmaker wants to keep expanding its sales in the notebook market and in the emerging dense-server market. The company scored victories in both areas during the quarter.
Transmeta's most formidable competitor is Intel, analysts say. In January, the chipmaker announced an energy-saving Pentium III chip designed to compete with Transmeta's Crusoe chip. The company plans to increase the clock speed of its power-saving Pentium III to 600MHz in the second half. However, the chip will continue to run at 300MHz while a notebook uses battery power.
"Intel has really been ratcheting up in response to AMD and Transmeta. So as a result, its position is stronger than it was six or nine months ago," Mike Feibus, principal analyst at Mercury Research, said in a recent interview.
That doesn't mean Transmeta won't do well, he added. "But I don't expect to see a wholesale defection (to Transmeta) either."
This week, NEC announced a pair of corporate-oriented Versa notebooks with Transmeta chips. Although Sony had been shipping Transmeta-based Vaio notebooks in North America since late 2000, NEC's new notebooks represent the chipmaker's first corporate win on the continent.
Despite the reluctance of some big-name PC makers to use Transmeta chips so far, analysts expect it to ship 1 million of its Crusoe chips this year.
Transmeta shipped about 150,000 Crusoe chips in 2000, according to Mercury Research.
Mercury estimates Transmeta shipped about 150,000 chips in the first quarter but predicts it is on track to ship about 1 million units on the year, Feibus said.
"I think (Transmeta) is growing faster than we thought it would late last year," he said.