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Netgear reports flat Q4, 2012

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V&D Bureau
New Update

Netgear's net revenue for the fourth quarter ended December 31, 2012 was $310.4 mn, as compared to $309.2 mn for the fourth quarter ended December 31, 2011.

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Net income, computed in accordance with GAAP, for the fourth quarter of 2012 was $16.1 million, or $0.41 per diluted share. This compared to GAAP net income of $22.8 million, or $0.60 per diluted share, for the fourth quarter of 2011.

Net revenue for the full year 2012 was $1.27 billion, a 7.7 percent increase as compared to $1.18 billion for 2011. Non-GAAP income from operations for the full year 2012 was $147.7 million, as compared to non-GAAP income from operations of $145.8 million for the full year 2011. Net income, computed in accordance with GAAP, for 2012 was $86.5 million, or $2.23 per diluted share. This net income was a 5.4 percent decrease compared to net income of $91.4 million, for 2011.

Patrick Lo, chairman and chief executive officer of NETGEAR said, "The worldwide macroeconomic environment proved challenging for us during the second half of 2012. In the fourth quarter, we witnessed reduced spending among our service provider customers and commercial business unit customers. Despite this, our retail business unit experienced the best fourth quarter sequential growth in the last three years. We are very pleased with the share gain against our retail competitors worldwide."

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"The fourth quarter was a record quarter in terms of net revenue for our retail business unit driven by strong share gain in the US and other international markets. Our fourth quarter 2012 service provider business unit net revenue was down 12 percent sequentially, but up an impressive 25 percent year-over-year for the full year of 2012."

Christine Gorjanc, chief financial officer of NETGEAR, said, "While the slowdown faced in the second half of 2012 has been challenging, we remain committed to pursuing the growth opportunities we see in smart homes, next generation service providers and 21st century SMBs. We are maintaining financial discipline while continuing to drive innovation with historically higher expenditures in research and development. Our R&D expenditure allows us to execute our first-to-market strategy and consistently meet the demand for next generation wireless connectivity products within the markets that we serve."

Lo added, "Looking forward, our plan for 2013 calls for organic growth in revenue and profits with further incremental growth once the AirCard acquisition is complete. We expect the first half of 2013 to be tempered by reduced spending from our service provider customers and macroeconomic uncertainty with growth in the second half of the year. Specifically, we expect first quarter 2013 net revenue to be in the range of $290 to $305 million."

In 2013, we expect to continue to drive growth via aggressive new product introductions added Lo.

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