Transmeta yesterday restated its Q2 loss narrowing the extent to which its Q3 losses, also reported yesterday, expanded beyond the previous quarter's figure and the company missed its revenue forecast.
In the three months to 24 September 2004, Transmeta lost $27.5m (16 cents a share). Some $5.8m of that were down to charged arising from an inventory adjustment. Similar adjustments - the company ordered too much package substrate materials - added $1.3m to Q2's $25.5m loss, taking it to the restated figure of $26.8m (15 cents a share).
The widening loss came despite a 17 per cent sequential increase in revenues, rising from Q2's $6m to Q3's $7m. That's still below the $8-8.7m the company forecast after announcing its Q2 figures. Q3's sales were split $3.3m:$3.7m, product:licensing/service revenue.
The latter looks to be a source of hope for the company: it announced an unnamed "multi-billion dollar semiconductor company" has formally said it intends to license Transmeta's LongRun 2 power-preservation technology. The deal is expected to be signed this quarter.
Product sales declined sequentially, Transmeta said, but are not expected to fall further during Q4. Licensing, on the other hand, looks set to contribute at least $6.3m to Q4's bottom line. It said its loss will shrink down to the 10-12 cents a share range, again incorporating inventory adjustment charges, on revenues between $9.8m and $10.3m.
Company CFO Mark Kent said a $16m licensing deal already signed with IBM has been restructured to allow Transmeta to pay the company $4m a quarter for the next four quarters rather than cough up the lump sum by the end of Q4, the better to ease its cashflow. ®
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