Mellanox Delivers Record Revenue for the Second Quarter of 2019 

SUNNYVALE, Calif. and YOKNEAM, ISRAEL,  July 24, 2019 — Mellanox Technologies, Ltd., a leading supplier of high-performance, end-to-end interconnect solutions for data center servers and storage systems, today announced preliminary financial results for its second quarter ended June 30, 2019.

“Mellanox delivered record revenue in Q2, achieving 2 percent sequential growth and 16 percent yearover-year growth. We continue to demonstrate leadership with our Ethernet adapter solutions for data rates of 25 gigabit per second and above. The growth in our Ethernet business reflects strong demand from our cloud customers as well as expanding channel sales. We are pleased that we’ve begun shipping 200 gigabit per second Ethernet adapters, switches, and cables to our data center customers, and expect this to be a future revenue growth driver,” said Eyal Waldman, president and CEO of Mellanox Technologies. “We continue to see strong demand for our InfiniBand products across the high performance computing, artificial intelligence, cloud, and storage market segments, driven by our highest throughput 200 gigabit HDR InfiniBand solutions. InfiniBand accelerates six of the top ten supercomputers in the world today, including the top three. We are proud that multiple HDR InfiniBand systems have entered the TOP500 supercomputers list, led by the Frontera TACC system, which is the fastest TOP500 supercomputer built in 2019 and premiered at #5 on the list.”

“We are pleased with our financial performance this quarter and the adoption of our latest 25, 50, and 100Gb/s Ethernet and 200Gb/s HDR InfiniBand products,” continued Waldman. “We expect to maintain and grow our leadership in these segments as we expand our footprint for both adapters and switches in
the data center.”

Second Quarter 2019 – Highlights

• Revenue of $310.3 million in the second quarter, an increase of 15.6 percent, compared to $268.5 million in the second quarter of 2018.
• GAAP gross margins of 64.5 percent in the second quarter, compared to 61.4 percent in the second quarter of 2018.
• Non-GAAP gross margins of 67.9 percent in the second quarter, compared to 69.1 percent in the second quarter of 2018.
• GAAP operating income of $42.2 million in the second quarter, compared to $16.6 million in the second quarter of 2018.
• Non-GAAP operating income of $84.7 million in the second quarter, or 27.3 percent of revenue, compared to $66.2 million, or 24.7 percent of revenue in the second quarter of 2018.
• GAAP net income of $38.4 million in the second quarter, compared to $16.5 million in the second quarter of 2018.
• Non-GAAP net income of $83.9 million in the second quarter, compared to $66.6 million in the second quarter of 2018.
• GAAP net income per diluted share of $0.68 in the second quarter, compared to $0.30 in the second quarter of 2018.
• Non-GAAP net income per diluted share of $1.52 in the second quarter, compared to $1.25 in the second quarter of 2018.
• $58.6 million in cash provided by operating activities in the second quarter, compared to $46.7 million in the second quarter of 2018.
• Cash and investments totaled $610.6 million at June 30, 2019, compared to $552.6 million at March 31, 2019.

Commentary regarding Mellanox Acquisition by NVIDIA

As announced on March 11, 2019, NVIDIA Corporation intends to acquire all the issued and outstanding common shares of Mellanox for $125 per share in cash. Due to the pending acquisition, Mellanox will not hold an earnings conference call and has suspended the practice of providing forward-looking guidance.

Recent Mellanox Press Release Highlights

• July 8, 2019 Mellanox Capital Extends Storage Ecosystem with Investments in CNEX Labs and Pliops
• June 18, 2019 Mellanox Liquid Cooled HDR 200G Multi-Host InfiniBand Adapters Accelerate Lenovo’s Most Advanced Liquid Cooled Server Platform
• June 17, 2019 InfiniBand Accelerates Six of the Top Ten Supercomputers in the World, Including the Top Three, and Four of the Top Five on June’s TOP500
• June 17, 2019 Mellanox HDR 200G InfiniBand Accelerates New Generation of World-Wide High-Performance Computing and Artificial Intelligence Supercomputers
• June 5, 2019 Check Point Software Technologies Propels Mellanox Past One Million Ethernet Switch Ports
• May 20, 2019 Mellanox Introduces Ethernet Cloud Fabric Technology based on the World’s Most Advanced 100/200/400GbE Open Ethernet Switches
• May 15, 2019 Mellanox Capital Invests in Storage Leaders Excelero and WekaIO
• May 13, 2019 Mellanox Introduces Advanced Network Telemetry Technology to Keep Your Business Up and Running
• April 16, 2019 Mellanox Delivers Record Revenue for the First Quarter of 2019

About Mellanox

Mellanox Technologies (NASDAQ: MLNX) is a leading supplier of end-to-end Ethernet and InfiniBand intelligent interconnect solutions and services for servers, storage, and hyper-converged infrastructure. Mellanox’s intelligent interconnect solutions increase data center efficiency by providing the highest throughput and lowest latency, delivering data faster to applications, unlocking system performance and improving security. Mellanox offers a choice of high-performance solutions: network and multicore processors, network adapters, switches, cables, software and silicon, that accelerate application runtime and maximize business results for a wide range of markets including high performance computing, enterprise data centers, cloud, storage, cyber security, telecom and financial services. More information is available at: www.mellanox.com.

Source: Mellanox Technologies