Emulex Reports 3Q08

COSTA MESA, Calif. -- Emulex Corporation (NYSE:ELX) today announced results for its third fiscal quarter ended March 30, 2008.

Third Quarter Highlights

• Total net revenues of $127.8 million -- an increase of 6% year-
  over-year
• Host Server Product net revenues of $85.1 million -- 67% of total
  net revenues
• Embedded Storage Product net revenues of $42.5 million -- 33% of
  total net revenues
• GAAP gross margin of 63% and non-GAAP gross margin of 67%
• GAAP operating income of $19.5 million, or 15% of total net
  revenues, and non-GAAP operating income of $34.4 million, or 27%
  of net revenues
• GAAP diluted EPS of $0.19 and non-GAAP diluted EPS of $0.31
• Cash, cash equivalents and investments of $332.1 million
• Inventory turnover of 12.2 times

Financial Results

Third quarter net revenues were $127.8 million, an increase of 6% over the comparable quarter of last year and a 2% decrease from the second quarter of the current fiscal year. Third quarter GAAP net income was
$15.5 million, or $0.19 per diluted share. GAAP net income per diluted share increased 46% from the $0.13 per diluted share reported in the year ago period, but decreased 10% on a sequential basis from $0.21 per diluted share. Non-GAAP net income for the third quarter, which excludes amortization of intangibles and stock-based compensation, was
$25.7 million, or $0.31 per diluted share. Non-GAAP net income per diluted share increased 15% from the $0.27 per diluted share reported last year, but decreased 9% sequentially from $0.34 per diluted share reported in the second quarter. Reconciliations between GAAP and non-GAAP results are included in the accompanying financial data.