The lead underwriters on the deal were Morgan Stanley, Barclays, and Deutsche Bank. Shares are set to open for trading later this morning on the NYSE.
AQ is a leader in the design, development and marketing of advanced high-speed communications integrated circuits (ICs) for Ethernet connectivity in the data center, enterprise infrastructure and access markets. Its Ethernet products provide a critical interface between the high-speed analog signals transported over wired infrastructure and the digital information used in computing and networking equipment.
Further, its products are designed to cost-effectively deliver leading-edge data speeds for use in the latest generation of communications infrastructure to alleviate network bandwidth bottlenecks caused by the exponential growth of global Internet Protocol, or IP, traffic. Many of its semiconductor solutions have established benchmarks in the industry in terms of performance, power consumption and density.
AQ is a fabless semiconductor company. It has shipped more than 10 million ports to customers across three semiconductor process generations, and are currently in mass production in 28nm process node. 28nm and other silicon process geometries, such as 40nm and 90nm, refer to the size of the process node in nanometers for a particular semiconductor manufacturing process. Its target markets include ASICs and ASSPs for Data Processing and Communication.
AQ estimates that its serviceable addressable market opportunity across its application-specific standard product, or ASSP, and application-specific integrated circuit, or ASIC, applications is approximately 100 million Multi-Gig Ethernet ports in 2020.
For the six months ended June 30, 2017, revenue was up 18% year/year to $48.8 million. This was mainly due to an increase in product sales volume sold to the enterprise infrastructure market, while ASP impact for products in volume production was not significant.
Gross profit increased by $2.7 million, or 11%. However, for this period, its gross margin decreased by 4% to 57% from 61% primarily due to the impact of $1.6 million in deferred revenue recognized for the six months ended June 30, 2016, which approximates 4% of total revenue for the six months ended June 30, 2016.
Total operating expenses were up 20% to $28.9 million with Research and Development climbing the most, up $3.6 million.
Overall, AQ has an operating loss of ($1.0) million for the six months ended June 30, 2017, compared to an operating profit of $1.2 million in the year ago period.