Mellanox Technologies (Nasdaq: MLNX) reported stronger than expected earnings and revenues for the first quarter of 2019. The fabless semiconductor company said it is on track to be acquired by chipmaker Nvidia (Nasdaq: NVDA), as announced earlier. The stock closed Tuesday’s trading session slightly higher and continued to gain in the after-hours, following the announcement.
In the March quarter, adjusted earnings moved up 62% year-over-year to $1.59 per share and exceeded the market’s estimates. Reported profit was $48.6 million or $0.87 per share, up from $37.8 million or $0.71 per share a year earlier. Total revenues advanced 22% to $305.2 million and topped the expectations. At 64.6%, gross margin remained robust during the quarter.
“Mellanox delivered record revenue in Q1, achieving 5 percent sequential growth and 22 percent year-over-year growth. All of our product lines grew sequentially, showing the benefits of our diversified data center strategy,” said CEO Eyal Waldman.
The company said it is on track to be acquired by chipmaker Nvidia under a definite agreement signed earlier this year
Reiterating its earlier statement, the Sunnyvale, California-based company said it is going ahead with the merger deal with Nvidia, under which the latter will acquire Mellanox for $125 per share in cash. Meanwhile, the management stopped the practice of issuing future guidance and decided not to hold an earnings conference call, due to the pending acquisition.
In the fourth quarter, the company reported adjusted earnings of $1.42 per share, which marked an improvement from $0.82 per share reported in the year-ago period. Driving the turnaround, December-quarter revenues jumped 22% year-over-year to $290 million.
Having gained about 30% since the beginning of the year, Mellanox shares are currently trading close to the record highs seen seven years ago. The stock gained slightly during Tuesday’s extended trading, after closing the regular session higher.