Xilinx (XLNX) develops programmable devices in the form of FPGAs (field programmable gate arrays), SoCs (system on chips), and 3D ICs (three-dimensional integrated circuits). It also offers associated technologies such as software design tools to program these chips, targeted reference designs, printed circuit boards, and IP (intellectual property).
These products are categorized into advanced and core products, while newly launched products are categorized under advanced products and products that have now become mainstream.
Revenue by product
The contribution of advanced products to Xilinx’s total revenues increased from 31% in fiscal 2Q16 to 47% in fiscal 3Q16 and has stayed above 40% since then. This increase was driven by the launch of 16 nm products ahead of Intel’s (INTC) Altera.
The next big increase in advanced products is likely to come in fiscal 4Q17, when Xilinx reports the order from Amazon (AMZN) Web Services for its 16 nm UltraScale Plus FPGA products.
Revenue by process node: 28 nm
Fiscal 2Q17 marked Xilinx’s fourth consecutive quarter of record sales of 28 nm products, driven by strong demand for Zynq product line. Zynq product sales rose 25% sequentially due to strong demand in the automotive, wireless, industrial, and consumer markets.
The company has expanded its 28 nm based Spartan, Artix, and Zynq product families to include applications such as Embedded Vision and Industrial IoT (Internet of Things). The new applications should start contributing to revenues in fiscal 3Q17.
Xilinx’s 20 nm product revenues surpassed the $40 million target by a large amount in fiscal 2Q17 due to strong demand in industrial tests, measurement, wired, and wireless markets. The company expects 20 nm sales to cross the $50 million target in fiscal 3Q17.
Xilinx started its production of 16 nm products ahead of schedule, giving it a one-year lead over Altera. During the year, Xilinx shipped nine types of 16 nm products to 200 customers in the areas of automotive, data center, and communications.
The company is actively expanding its 16 nm portfolio in fiscal 3Q17 to maintain its lead above Altera, which launched its 14 nm product Stratix 10 in October 2016.
Xilinx’s 16 nm FPGAs are gaining popularity in the data center market. China’s Baidu (BIDU) has adopted this product to develop commercially-viable autonomous cars, while Amazon has adopted it to offer FPGA-backed cloud services.
Notably, Xilinx is a member of the CCIX (Cache Coherent Interconnect for Accelerators) technology consortium, which has seen its membership increase threefold.
Continue to the next part for a look at how Xilinx is placed in its end markets.