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Release LibraryCambridge, UK –29 October 2008 CSR (LSE: CSR) today announced its unaudited financial results for the third quarter of 2008. Performance for the quarter was in line with guidance - revenues were $205.5m up 9% over the second quarter. The company has also achieved gross margins of 44.5%, consistent with guidance and the prior quarter. However, the difficult economic environment is having an impact on customer end markets and as such the company expects to reduce combined R&D, sales, general and administration expense in 2009 by around $20m from 2008 levels.
CSR expects to maintain or extend its leadership position in the key markets of handsets, headsets, automotive and consumer electronics and believes that its strong portfolio of wireless products and technologies will help CSR achieve this.
CSR’s major Connectivity Centre product, BlueCore7, is on track. BlueCore7 was launched earlier this year and integrates classic Bluetooth with Bluetooth low energy, FM transmit and receive and even CSR’s own eGPS navigation technology. CSR is confident that BlueCore7 will appeal to key Tier 1 handset manufacturers and will begin shipping in the first half of 2009 as planned.
The development of MusiCore, CSR’s chip that enables music phones with 100 hours of high quality music playback, plus Bluetooth functionality, has progressed according to plan. The company is developing MusiCore to an aggressive schedule and expects that this product will win design slots with Tier 1 manufacturers during the first half of 2009.
UniFi, CSR’s market leading embedded Wi-Fi technology with extremely low power consumption and industry leading coexistence, has already been designed into more than six handsets, with additional design wins with Tier 1 manufacturers in the pipeline. CSR’s next generation Wi-Fi product is on track to sample to customers during the fourth quarter.
The headset market continues to be strong for CSR, due to the company’s technological superiority and innovation. CSR estimates its market share to be around 80%. CSR’s products are particularly strong in high-end headsets where customers demand the highest quality product with the greatest range of features for their devices. CSR wins almost all designs in this segment. CSR has created BlueVox2 and BlueVox DSP solutions specifically to ensure it continues to compete effectively in the lower cost Bluetooth headset market.
CSR is the market leader for providing Bluetooth solutions to the automotive market, which has seen good growth as attach rates continue to increase. Despite the expected slowing in global demand for new cars, the company expects the Bluetooth market to increase significantly next year, with a greater percentage of cars sold including Bluetooth kits, as manufacturers seek to offer higher specification levels.
Notable design wins for CSR include a leading German based car manufacturer. CSR has also been confirmed as the continued sole supplier to another leading German automotive producer in 2009. An additional win for CSR with a leading French car maker further demonstrates the company’s continued strength in this market.
Personal Navigation Devices (PNDs) also remain an important market with a leading US PND maker now using CSR’s RoadTunes product in all its high volume devices.
CSR CEO Joep van Beurden commented on the results, “Our exclusive focus on the Connectivity Centre is serving us well, and the growth opportunity it provides is compelling. We are also seeing widening demand for our products in non-cellular applications, such as gaming and audio, which provides us with encouragement about the diversity of future potential demand.” van Beurden continued, “We are aligning our business and cost base with the changed economic conditions while reinforcing our ability to develop and deliver innovative new products, grow market share and capitalise on the future growth opportunities available to us. We are accelerating completion of an operational assessment we undertook earlier this year and we have identified significant further efficiencies we can secure alongside an expected reduction in headcount.”
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