Ethernity revenues to be below forecasts

Ethernity Networks said revenues and profits for the year ended 31 Dec would be below market expectations but it had significantly increased operating profits when compared to the previous year.

It said the trend highlighted during the first half of a move from FPGA sales to royalties and large licensing deals continued in the second half, as demonstrated by the announcement of a new contract win with an Australian equipment manufacturer in December.

Ethernity said it was also anticipated that an existing customer would vary a large licensing deal to include an additional large sum of upfront cash and a royalty stream for integrating the company's data processing code into a customer wireless ASIC.

However, ultimately the customer has selected a different Ethernity proposal to use an FPGA SoC.

It said: 'This should result in significant additional revenues being received by the company through the delivery of a complete FPGA SoC into the customer's large volume market that could not previously be served by the alternative solution.

'This further demonstrates the company's vision that FPGA solutions penetrate a larger volume market than has previously been served entirely by ASIC. Ethernity is well placed to benefit from selling complete FPGA SoC solutions.'

At 8:10am: (LON:ENET) Ethernity Networks Ltd share price was -44p at 84.5p