Mentor Graphics Corporation announced financial results for the company’s fiscal second quarter ended July 31, 2015. The company reported revenues of $281.1 million, non-GAAP earnings per share of $0.36, and GAAP earnings per share of $0.26.
“Revenue was an all-time second quarter record and Mentor exceeded non-GAAP earnings per share guidance for the 26th consecutive quarter,” said Walden C. Rhines, chairman and CEO. “Customer need for increased amounts of software drove early renewal activity and the upside in the quarter. Demand was strongest in both Design to Silicon and Scalable Verification. During the quarter we added five new emulation customers, including both a Top Ten chip company and a start-up.”
During the quarter, the company announced Veloce® Power Application software, which captures real power consumption during emulation and passes the information efficiently to power analysis tools. Mentor also announced its next-generation MicReD® Industrial Power Tester, which now provides 1500 amp electronic component power cycling and thermal testing for up to 12 devices simultaneously, to benefit automotive, railway, power generation and renewable energy industries. The quarter also had a major new release of the Mentor® Enterprise Verification Platform, with new levels of Questa® performance and productivity in areas including simulation, debug, and low-power verification.
In the second quarter the company also announced the newest version of the FloTHERM® XT product, with EDA connectivity for advanced thermal management of electronic systems, printed circuit boards and packages of any geometric complexity. In addition Mentor introduced the latest release of the Flowmaster® computational fluid dynamics software targeting network systems in automotive, aerospace and power generation. The company also announced a new release of the Mentor® Embedded Nucleus® Real-Time Operating System targeting connected embedded devices for high-performance Internet of Things applications.
“Second quarter results highlight both our continued rigorous attention to cost control and the operating leverage in our business,” said Gregory K. Hinckley, president of Mentor Graphics. “On an 8% increase in revenue, GAAP and non-GAAP operating expenses grew less than 1.5% year on year. Second quarter revenue exceeded guidance by 12% while non-GAAP EPS was up over 150% versus guidance. Cash flow, another important metric, was strong with cash flow from operations of $49 million in the second quarter and $95 million in the first half of fiscal 2016.”
Outlook
For the third quarter of fiscal 2016, the company expects revenue of about $290 million, non-GAAP earnings per share of about $0.27 and GAAP earnings per share of approximately $0.17. For the full year fiscal 2016, the company is raising revenue guidance to about $1.285 billion; is increasing non-GAAP earnings per share guidance from $1.88 to about $1.90; and currently expects GAAP earnings per share of approximately $1.25.
Dividend
The company announced a quarterly dividend of $0.055 per share on outstanding common stock. The dividend is payable on September 30, 2015 to shareholders of record at the close of business on September 10, 2015.
