Semi IP sector is a lost cause

 
SAN JOSE, Calif. -- Except in a few cases, the semiconductor intellectual-property (IP) sector is a non-profit business.

It's simply a lost cause, with a questionable business model. Most IP vendors are losing money in the arena. This week, in fact, several IP vendors posted losses for the quarter, including Aware, MoSys and Virage.

This week, Mosaid Technologies Inc. concluded the sale of certain assets of its IP product development business to Synopsys Inc. for $15.3 million in cash.

A few others have kept their heads above water, such as ARM, Rambus, and one other vendor. For example, MIPS Technologies Inc. said revenue for the fourth quarter was $23.7 million, an increase of 24 percent over third quarter revenue of $19.1 million, and an increase of 30 percent from revenue of $18.2 million reported in the fourth fiscal quarter a year ago. Net income in the fourth quarter of fiscal 2007 on a generally accepted accounting principles (GAAP) basis was $2.3 million, compared to net income of $1.2 million in the third quarter and $7.5 million in the fourth quarter of fiscal 2006. GAAP net income per share on a diluted basis in the fourth quarter of 2007 was $0.05, compared with GAAP net income per share of $0.03 in the third quarter and $0.17 in the fourth quarter of 2006.

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