updated 10/28/2010 4:45:20 AM ET 2010-10-28T08:45:20

Revenue up 51% Quarter-Over-Quarter to $61.3 Million

Conference Call to be Webcast Today at 1:30 p.m. Pacific Time

SAN DIEGO, Oct. 27, 2010 (GLOBE NEWSWIRE) -- Entropic Communications, Inc. (Nasdaq:ENTR), a leading provider of silicon and software solutions to enable connected home entertainment, today reported its third quarter results for the period ended September 30, 2010. Entropic reported third quarter net revenues of $61.3 million, an increase of 51 percent compared with $40.7 million in the second quarter of 2010 and an increase of 98 percent compared to $31.0 million in the third quarter of 2009.

In accordance with U.S. generally accepted accounting principles (GAAP), the company's third quarter net income was $11.3 million, or $0.15 per share. This compares with GAAP net income of $3.1 million, or $0.04 per share in the second quarter of 2010. Non-GAAP net income in the third quarter was $14.5 million, or $0.18 per share, compared to non-GAAP net income of $6.1 million, or $0.08 per share in the second quarter of 2010.

"Entropic recorded its sixth consecutive quarter of revenue growth and posted record revenue and profitability for the quarter," said Patrick Henry, president and chief executive officer of Entropic Communications. "During the quarter we benefitted from increasing adoption of our MoCA home networking products by multiple Pay-TV service providers as well as a solid ramp in our solutions for the direct broadcast satellite market.  We believe we are in the very early stages of a multi-year market expansion in the connected home entertainment market and are well positioned for continued revenue and earnings growth."

Recent Highlights

  • Entropic ranked #44 as the fastest growing company in North America, and is the fastest growing semiconductor company on Deloitte's 2010 Technology Fast 500™. For the San Diego region, Entropic ranked #3 in the fastest growing company category.
     
  • In early October, Entropic completed a follow-on offering of 10.75 million shares of its common stock, raising net proceeds of approximately $99.1 million after deducting underwriting discounts and commissions and estimated offering expenses.
     
  • Entropic expanded its Board of Directors with the addition of Ted Tewksbury, president and chief executive officer of Integrated Device Technology, Inc. (IDT) and Bob Bailey, chairman of the board of PMC Sierra. Each is a seasoned executive in the semiconductor industry, offering expertise in mixed signal and analog application-specific standard products. With CEO and board experience, and strong operations and engineering background, both Tewksbury and Bailey are significant assets to the Entropic Board; complementing the expertise of the Company's current board members.
     
  • Via Embratel, the premium telecommunications carrier in Brazil, deployed Entropic's Channel Stacking Switch (CSS) technology to deliver direct-broadcast satellite (DBS) entertainment services to consumers' homes via a single cable wire infrastructure. By adopting Entropic's CSS technology, Via Embratel can better serve customers in multiple-dwelling unit (MDU) environments by supporting multiple tuners over a single cable, enabling easy plug-and-play set-top box (STB) upgrades, and reaching potential new subscribers previously unserviceable due to access limitations or wiring restrictions.
     
  • Robust Electronics, a leading manufacturer of top end televisions for the European market, announced selection of Entropic's EN4020 multi-mode hybrid silicon tuner .With its internal design, the EN4020 allows the complete lineup of MINERVA televisions to operate regardless of broadcast service -- digital video broadcast terrestrial (DVB-T), digital video broadcast cable (DVB-C), or analog. A single chip solution, the EN4020 delivers high performance and enables significant cost reduction by simplifying design complexity and drastically lowering development costs. Deliveries of the MINERVA TV line are scheduled to begin in late 2010.
     
  • Entropic expanded and strengthened its supplier capacity agreement with silicon foundry, TowerJazz to assure high-volume production for Entropic's family of outdoor unit (ODU) silicon, which comprises both its CSS and Band Translation Switch (BTS) products, as well as its multi-mode silicon TV tuner products.

For More Information

Entropic management will be holding a conference call today, October 27, 2010, at 1:30 p.m. Pacific Time/ 4:30 p.m. Eastern Time to discuss the company's results for the third quarter of fiscal 2010 and to provide guidance for the fourth quarter. You may access the conference call via any of the following:

About Entropic Communications

Entropic Communications, Inc. (Nasdaq:ENTR) is a leading fabless semiconductor company that is engineering the future of connected home networking and entertainment by providing next-generation silicon and software technologies to the world's leading cable, telecommunications and satellite service providers, OEMs and consumer electronic manufacturers. As a co-founder of MoCA (Multimedia over Coax Alliance), Entropic pioneered and continues to evolve the way high-definition television-quality video and other multimedia and digital content such as movies, music, games and photos are brought into and delivered throughout the home. For more information, visit Entropic at www.entropic.com .

The Entropic Communications logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=4255

Non-GAAP Financial Measures

This press release and the accompanying tables contain the following non-GAAP financial measures: net income (loss) and net income (loss) per share. These non-GAAP financial measures exclude the effects on the Statement of Operations of, among others, all forms of stock-based compensation, non-cash acquired intangibles amortization and impairment charges, and restructuring charges, and their related effects on the number of diluted shares used in calculating non-GAAP income (loss) per share.

Management uses these non-GAAP financial measures to manage the company's business, including setting operating budgets and executive compensation plans. These non-GAAP measures are also used to (i) supplement the financial results and forecasts reported to the company's board of directors, (ii) evaluate the company's operating performance, (iii) compare the company's performance to internal forecasts, and (iv) manage the company's business and benchmarking performance internally. The non-GAAP measures have been made available to stockholders consistently in the past to provide transparency on how management manages the company's operating performance. Management believes that these non-GAAP operating measures are useful to investors, when used as a supplement to GAAP measures, in evaluating the company's ongoing operational performance.

The non-GAAP financial measures disclosed by the company should not be considered in isolation or a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP, and the financial results calculated in accordance with GAAP and reconciliations to those financial statements should be carefully evaluated. The non-GAAP financial measures used by the company may be calculated differently from, and therefore may not be comparable to, similarly titled measures used by other companies.

Forward-Looking Statements

Statements in this press release that are not strictly historical in nature constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements include, but are not limited to, statements regarding our expectations for market expansion, continued and/or future revenue, earnings and product sales growth and the factors that may contribute to such growth. Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause Entropic's actual results to be materially different from historical results or from any results expressed or implied by such forward-looking statements. These factors include, but are not limited to, our dependence on a limited number of customers and service providers for a substantial portion of our revenues; risks that the market for HD and SD video and other multi-media content delivery and networking solutions in the United States, China and elsewhere will not develop as we expect; risks associated with competing against larger and more established companies and our ability to compete successfully in the market for MoCA-compliant chipsets; risks associated with timely development and introduction of new or enhanced products; risks that our collaborations and partnerships will not yield their anticipated benefits; risks associated with adverse U.S. and international economic conditions; and other factors discussed in the "Risk Factors" section of Entropic's Quarterly Report on Form 10-Q for the quarter ended June 30, 2010. All forward-looking statements are qualified in their entirety by this cautionary statement. Entropic is providing this information as of the date of this release and does not undertake any obligation to update any forward-looking statements contained in this release as a result of new information, future events or otherwise.

Entropic Communications® and the stylized Entropic "curve" logo are either trademarks or registered trademarks of Entropic Communications, Inc. in the United States and/or other countries.

© Copyright 2012, GlobeNewswire, Inc. All Rights Reserved

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