11.23
MSD will report its Q2/F10 results on November 26 after market close. A call has been scheduled for 5:00 PM. We expect an in-line quarter with guidance reflecting continuous growth throughout F10. Investors remain most interested in a Samsung update on the progress towards a renewal.
For Q2/F10, we expect revenue of $16MM, up 16% y/y but down 1% q/q. We expect higher opex, leading to EPS of $0.56. Our forecast for patent licensing and litigation is up from last quarter as the company should incur greater costs from its IBM patent infringement case it recently initiated.
For fiscal 2010, we expect revenue of $67MM and EPS of $2.13. This
compares to guidance of $65-$67MM (70% booked with deals) and EPS of $2.07-$2.17. This guidance reflects the remaining Samsung payments and the increase in litigation opex.
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