Vecima Q4 revenues spike 11%, led by SDR sales
September 28, 2012
VICTORIA - Vecima Network’s software-defined radio solutions helped boost Q4 revenues for the broadband equipment designer and manufacturer to $28.7 million, up 11% compared to Q3. Company executives expect revenue for fiscal 2013 to increase by 10-20% and for gross margin to be in the 35% to 40% range.
It credits strong converged wired solutions sales, particularly in its Terrace family, OEM QAM modules and Terrace QAM for the overall growth. It's broadband wireless sales also increased 4% to $2.5 million in Q4. It attributed the increase to software defined radio (SDR) sales that target high growth commercial markets such as public safety, security, satellite communications, and broadband wireless.
"The company's progress this past fiscal year has been very encouraging with company sales increasing 13% from $84.5 million to $95.7 million. Vecima's growth in revenue is attributed to the broadened market acceptance of Vecima's new converged wired products. These products include the Terrace family of products for the all-digital transition and Terrace QAM for high definition within hospitality," said Dr. Surinder Kumar, CEO of Vecima.
"We've made significant effort to fill the current and future revenue pipeline with new products and agreements. During fiscal year 2012, Vecima made two major announcements regarding future products. One of the announcements highlighted a design win for next generation digital cable broadband transmitter technology. This will keep Vecima at the forefront of cable broadband access. The second announcement indicated that we've signed a major OEM agreement guaranteeing approximately $19 million in sales.”
It reported broadband wireless and YourLink revenue for the year of $10.1 million and $12.7 million respectively. Wireless revenue increased 17% year-over-year also due to increased SDR sales.
Many experts believe that SDR is poised to unleash huge advances in the mobile market. SDR technologies are capable of configuring a wireless device to work with any communications system. Modern cell phones rely on multiple chips to handle tasks such as communicating with cell phone towers, Wi-Fi stations, GPS and Bluetooth devices. But SDR devices can reconfigure themselves to work with multiple signals, relying on software to implement specific applications not chips.
Applications range from recording FM radio and digital television signals, reading RFID chips to tactical radio solutions for the military. It also enables rapid prototyping of new communications protocols. The Wireless Innovation Forum (formerly Software Defined Radio Forum) is promoting SDR technology for military and for commercial applications.
Sales in Vecima’s Terrace line decreased to $8.1 million in the Q4 from $9.2 million in the third quarter, primarily due to “extraordinary demand in the third quarter.” Its recently introduced Terrace TC600 is its most rapidly growing product and it expects sales to continue to increase through fiscal 2013.
OEM QAM Module sales increased to $4.5 million in Q4, representing an increase of approximately 10% from $4.1 million in Q3. Vecima expect sales in our OEM QAM modules to decline significantly in fiscal year 2013 as its customers are transitioning to different solutions.
Sales in Terrace QAM increased in Q4 by 71% to $4.1 million compared to $2.4 million in the third quarter. It notes that there has been “exceptional growth in Terrace QAM sales through fiscal year 2012.” Vecima forecasts the sales of Terrace QAM will grow at a moderate pace through fiscal year 2013.
Terrace QAM provides enables cable system operators to deliver HD digital video streams in a secure format connecting directly to newer flat panel TVs, eliminating the need for an additional digital set top box. The product allows caable companies to service the emerging demand for HD content in hotels.
Uptake of its Concierge product has been slow says Vecima and it is working with a number of system integrators and expects sales to build in fiscal 2013.