 Doubles Year-Over-Year Revenue Driven by both Cloud and TelecomSANTA CLARA, Calif., Aug. 04, 2020 GLOBE NEWSWIRE -- Inphi Corporation NYSE: IPHI, a leader in high-speed data movement interconnects, today announced financial results for its second quarter ended June 30, 2020. GAAP ResultsRevenue in the second quarter of 2020 was a record 175.3 million on a U.S. generally accepted accounting principles GAAP basis, up 103.2 year-over-year, compared with 86.3 million in the second quarter of 2019. The increase was due to higher demand for Cloud and Telecommunications products as well as the inclusion of eSilicon revenues as a result of the acquisition that closed on January 10, 2020.Gross margin under GAAP in the second quarter of 2020 was 53.0, compared with 56.9 in the second quarter of 2019. The decrease was mainly due to amortization of intangibles, step up value of inventories related to the eSilicon acquisition and product and revenue mix.GAAP operating loss in the second quarter of 2020 was 4.3 million or 2.4 of revenue, compared to GAAP operating loss in the second quarter of 2019 of 14.2 million or 16.5 of revenue. The decrease in operating loss was mainly due to higher gross profit, partially offset by higher operating expenses.GAAP net loss includes a charge of 13.3 million associated with the extinguishment of approximately 403.5 million in face value of convertible notes of which 180.4 million were coming due in December 2020 and 223.1 million were coming due in September 2021. We paid the principal value in cash and settled the excess spread in shares of our common stock. In most cases a very small premium was paid in either cash or stock to induce early extinguishment and thereby capped any further dilution if the stock price were to continue to rise before maturity. Approximately, 4.0 million in cash inducements, advisory fees and other transaction costs were paid on the debt extinguishment. Approximately, 4.9 million shares of common stock were also issued at a weighted average price of 112 per share, of which approximately 3.3 million shares were already included in the first quarter non-GAAP weighted average shares calculation using an average stock price of approximately 78.GAAP provision for income taxes for the second quarter of 2020 include a one-time benefit of approximately 5.6 million primarily from the reversal of a previously accrued reserve for transfer pricing as the result of the formal closure of an income tax audit. This benefit was offset by a corresponding change in income tax valuation allowance.GAAP net loss for the second quarter of 2020 was 24.1 million or 0.49 per diluted common share, compared with 20.6 million or 0.46 per diluted common share in the second quarter of 2019. Inphi reports gross profit, operating expenses, net income loss, and earnings per share in accordance with GAAP and on a non-GAAP basis. A reconciliation of the GAAP to non-GAAP gross profit, operating expenses, operating income, net income, earnings per share, as well as a description of the items excluded from the non-GAAP calculations is included in the financial statements portion of this press release.Non-GAAP ResultsGross margin on a non-GAAP basis in the second quarter of 2020 was 64.1, compared with 70.1 in the second quarter of 2019. The decrease was due to product mix, mainly from the sale of eSilicon products that have a lower margin.Non-GAAP operating income in the second quarter of 2020 was 50.3 million, compared with non-GAAP operating income of 16.5 million in the second quarter of 2019. The increase is primarily due to higher gross profit and higher operating leverage.Non-GAAP benefit for income taxes for the second quarter of 2020 include a one-time benefit of approximately 5.6 million primarily from the reversal of a previously accrued reserve for transfer pricing as the result of the formal closure of an income tax audit.Non-GAAP net income in the second quarter of 2020 was 50.9 million, or 0.95 per diluted common share. This includes the one-time tax benefit referred to above which represents approximately 0.10 per diluted share as part of the 0.95 per diluted common share for the second quarter of 2020. This compares with non-GAAP net income of 16.6 million, or 0.35 per diluted common share in the second quarter of 2019.In Q2 our product offerings were firing on all cylinders. On a year-over-year basis, our Cloud revenue grew 92 driven by our PAM4 products inside data centers and our COLORZ solution between data centers. Our Telecom revenue grew 119 driven by both our new ASIC and PAM4 for 5G and our coherent solutions for long haul and metro, said Ford Tamer, President and CEO of Inphi Corporation. We continue to invest in resources both organically and through strategic acquisitions that can scale Inphi to larger opportunities ahead. Although we are cautious with regard to the macro uncertainties, we believe our continued success and breadth of product cycles will drive sequential growth in the third quarter.First Half 2020 Results Revenue in the six months ended June 30, 2020 was 314.7 million, compared with 168.5 million in the six months ended June 30, 2019. GAAP net loss in the six months ended June 30, 2020 was 44.3 million, or 0.93 per diluted share, on approximately 47.5 million diluted weighted average common shares outstanding. This compares with GAAP net loss of 43.3 million, or 0.97 per diluted share, on approximately 44.8 million diluted weighted average common shares outstanding in the six months ended June 30, 2019.Non-GAAP net income in the six months ended June 30, 2020 was 82.4 million, or 1.58 per diluted weighted average common share outstanding, on approximately 52.1 million diluted weighted average common shares outstanding. This compares with non-GAAP net income of 32.0 million in the six months ended June 30, 2019, or 0.69 per diluted weighted average common share outstanding, on approximately 46.5 million diluted weighted average common shares outstanding.Business OutlookThe following statements are based on the Companys current expectations for the third quarter of 2020. These statements are forward-looking and actual results may differ materially. A reconciliation between the GAAP and non-GAAP outlook is included at the end of this press release. Revenue in Q3 2020 is expected to be in the range of 179.0 million to 182.5 million. GAAP gross margin is expected to be approximately 55.1 to 56.2. Non-GAAP gross margin is expected to be approximately 63.5 to 64.5. Stock-based compensation expense is expected to be in the range of 29.0 million to 30.0 million. GAAP net loss is expected to be in range between 2.7 million to 6.3 million, or 0.05 to 0.12 per basic share, based on 52.1 million estimated weighted average basic shares outstanding. Non-GAAP net income, excluding stock-based compensation expense, acquisition expenses, amortization of intangibles and inventory fair value step up related to acquisitions and noncash interest on convertible debt, is expected to be in the range of 45.5 million to 47.9 million, or 0.83 to 0.87 per weighted average diluted share, based on 55.0 million estimated non-GAAP weighted average diluted shares outstanding. Quarterly Conference Call Today Inphi plans to hold a conference call today at 8:30 a.m. Eastern Time 5:30 a.m. Pacific Time with Ford Tamer, President and Chief Executive Officer, and John Edmunds, Chief Financial Officer, to discuss the second quarter 2020 results. The call can be accessed by dialing 765-507-2591, participant passcode: 9798966. Please dial-in ten minutes prior to the scheduled conference call time. A live and archived webcast of the call will be available on Inphis website at for up to 30 days after the call.About Inphi Inphi Corporation is a leader in high-speed data movement. We move big data -- fast, throughout the globe, between data centers, and inside data centers. Inphis expertise in signal integrity results in reliable data delivery, at high speeds, over a variety of distances. As data volumes ramp exponentially due to video streaming, social media, cloud-based services, and wireless infrastructure, the need for speed has never been greater. Thats where we come in. Customers rely on Inphis solutions to develop and build out the Service Provider and Cloud infrastructures, and data centers of tomorrow. To learn more about Inphi, visit Note Concerning Forward-Looking Statements These forward-looking statements may be identified by terms such as outlook, believe, expect, may, will, provide, continue, could, and should, and the negative of these terms or other similar expressions. These statements include statements relating to: the Companys business outlook and current expectations for 2020, including with respect to the third quarter of 2020, revenue, gross margin, stock-based compensation expense, operating performance, net income or loss, and earnings per share; the Companys expectations regarding growth opportunities, success of our growth strategy, strength of the cloud market, increasing demand in Q3 2020, growth inside data centers, customer relationships, the Companys expectations with respect to the investment in resources, ability to grow and the benefits of using non-GAAP financial measures. These statements are based on current expectations and assumptions that are subject to risks and uncertainties. 