SAN FRANCISCO Magma Design Automation Inc. Thursday (July 28) reported a nominal net loss on record quarterly revenue of $38.8 million for its fiscal first quarter of 2006.
The $38.8 million represents an increase of nearly 9 percent from the $35.7 million that the company reported for the previous quarter and an increase of 8 percent from the $36 million that it posted for the same period a year ago.
Magma (Santa Clara, Calif.) reported a net loss of $23,000 based on generally accepted accounting principles (GAAP), a dramatic improvement from the $5.6 million and $2.5 million losses it posted for the previous and year-ago quarters, respectively.
Roy Jewell, Magma's president and chief operating officer, said the company recorded a record number of deals during the quarter, spurred by gains in market share, greater willingness on the part of customers to engage and acceleration to smaller geometries, including 65 nanometer.
Jewell said many companies are starting to tool up for 65-nm designs, despite early predictions that increasing costs would prevent a widespread move to the node.
"We see more and more people, especially in the wireless communications space, running to 65 nm as fast as they can," Jewell said.
Magma executives said legal costs of about $4.5 million for the quarter included about $3 million spent on the company's high-profile litigation fight with Synopsys Inc. The executives said they expect expenses associated with this litigation to cost the company about $2 million per quarter for the foreseeable future.
In a statement issued Thursday, Rajeev Madhavan, Magma chairman and CEO, said it was a good quarter for the company.
"All key financial metrics finished in the high end of our target ranges and we completed the rollout of the new products developed as part of our Cobra initiative," Madhavan said. "Early feedback from users of our latest products has been very positive."
Magma said it expects fiscal second quarter revenue to be in the range of $37 million to $41 million. The company said it expects to report a GAAP net loss of 13 to 17 cents per share which, based on Magma's 33.6 million outstanding shares, would give the company a net loss in the range of $4.3 million to $5.7 million.
Magma's fiscal 2006 first quarter ended July 3.