Applied Micro tops 3Q expectations

Applied Micro Circuits (Nasdaq: AMCC) easily topped consensus expectations in the third quarter.

After market close Tuesday, the maker of chips for optical networking reported fiscal third quarter net income of $48.1 million, or 16 cents per share, excluding special charges. Analyst consensus predicted a profit of 14 cents per share on revenue of $130.3 million, according to earnings tracking firm First Call.

Shares of Applied Micro traded at 70.4063 in afterhours activity on the Island electronic communications network, immediately following the release of third quarter results. Applied Micro stock fell 1.25 to 70.375 in Tuesday's regular trading ahead of the earnings report.

Third quarter revenue increased 48 percent sequentially and 213 percent year-over-year to $143.3 million, including $20.6 million from the recently-acquired MMC Networks.

Applied Micro's communication business increased 37 percent for the company's core business and 34 percent including a full quarter's results from the MMC. Communication book-to-bill was 1.33 for the quarter.

Nortel Networks (NYSE: NT) remained Applied Micro's largest customer, generating 18 percent of revenue. About 68 percent of that Nortel revenue was for more recent standard networking products, rather than legacy chips.

Cisco Systems (Nasdaq: CSCO) was Applied Micro's second largest, at 10 percent of revenue.

Non-communications revenue fell to $12.5 million from $16.6 million in the previous quarter.

New products such as 10-gigabit and framer layer offerings fueled much of the growth, said Dave Rickey, chairman, president and CEO.

Including charges related to acquired in-process R&D, amortization and stock compensation, Applied Micro in the third quarter lost $269.5 million, or 95 cents per share.

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