Cavium Announces Financial Results for Q3 2016

SAN JOSE, Calif., November 1, 2016 – Cavium, Inc. (NASDAQ: CAVM), a leading provider of semiconductor products that enable secure and intelligent processing for enterprise, data center, cloud, wired and wireless networking, today announced financial results for the third quarter ended September 30, 2016.
Cavium completed the acquisition of QLogic Corporation (“QLogic”) on August 16, 2016. The financial results for the third quarter of 2016 include results from QLogic from the closing date to the end of the quarter.

Net revenue in the third quarter of 2016 was $168.1 million, a 56.9% sequential increase from the $107.2 million reported in the second quarter of 2016 and 60.0% from the $105.1 million reported in the third quarter of 2015.

Generally Accepted Accounting Principles (GAAP) Results
Net loss for the third quarter of 2016 was $14.4 million, or ($0.23) per diluted share, compared to $7.4 million, or $(0.13) per diluted share in the second quarter of 2016. Gross margins were 28.2% in the third quarter of 2016 compared to 66.9% in the second quarter of 2016. GAAP operating loss (GAAP loss from operations as a percentage of revenue) was 56.1% in the third quarter of 2016 compared to 6.4% in the second quarter of 2016. Total cash and cash equivalents were $192.4 million at September 30, 2016.

Non-GAAP Results
Cavium believes that the presentation of non-GAAP financial measures provides important supplemental information to management and investors regarding financial and business trends relating to Cavium’s financial condition and results of operations. Cavium believes that these non-GAAP financial measures provide additional insight into Cavium’s ongoing performance and has chosen to provide these measures for more consistent and meaningful comparison between periods. These measures should only be used to evaluate Cavium’s results of operations in conjunction with the corresponding GAAP measures. The reconciliation between GAAP and non-GAAP financial results is provided in the financial statements portion of this release.

In the third quarter of 2016, Non-GAAP net income was $28.0 million, or $0.43 per diluted share. Non-GAAP gross margin was 64.0% and Non-GAAP operating margin (non-GAAP income from operations as a percentage of revenue) was 19.2%.

Recent News Highlights

• October 31, 2016 - Cavium Introduced 10/25GbE Adapter Family for Open Compute Project Servers
• October 27, 2016 - Cavium QLogic Added PowerShell Integrated Management Solution for FastLinQ Ethernet Adapters
• October 25, 2016 - Cavium Showcased ARMv8 Processor Solutions to Accelerate Next Generation Infrastructure at ARM TechCon 2016
• October 25, 2016 - Cavium Showcased Highly Optimized Platforms for OpenStack Deployments at OpenStack Summit 2016
• October 25, 2016 - Cavium QLogic Accelerates Cloud Deployments with OpenStack Integration
• October 25, 2016 - SUSE Steps Up to Support Innovative ARM Solutions for Customers
• September 27, 2016 - Cavium QLogic Accelerates Software Defined Datacenters with Windows Server 2016
• August 30, 2016 - QLogic Showcased Multiple Technologies that Simplify and Accelerate Virtualized Server Deployments at VMworld 2016
• August 16, 2016 - Cavium Completed the Acquisition of QLogic
• August 16, 2016 - Cavium, Inc. Announced Successful Completion of the Exchange Offer in Connection with the Proposed Acquisition of QLogic Corporation
• August 10, 2016 - Cavium, Inc. Announced Extension of the Expiration of the Exchange Offer in Connection with the Proposed Acquisition of QLogic Corporation
• August 2, 2016 - Cavium, Inc. Announced the Expiration of HSR Waiting Period for the Acquisition of QLogic Corporation
• July 26, 2016 - Cavium Named Raghib Hussain Chief Operating Officer
• July 26, 2016 - Cavium Added Industry Veterans Brad W. Buss and Dr. Edward H. Frank to Board of Directors

Cavium will broadcast its third quarter of 2016 financial results conference call today, November 1, 2016, at 2 p.m. Pacific time (5 p.m. Eastern time). The conference call will be available via a live web cast on the investor relations section of the Cavium website at http://www.cavium.com. Please access the website at least a few minutes prior to the start of the call in order to download and install any necessary audio software. An archived web cast replay of the call will be available on the web site for a limited period of time.

About Cavium
Cavium offers a broad portfolio of integrated, software compatible processors ranging in performance from 1Gbps to 100Gbp that enable secure, intelligent functionality in Enterprise, Data Center, Broadband, Mobile and Service Provider Equipment, highly programmable switches which scale to 3.2Tbps and Ethernet and Fibre Channel adapters up to 100Gbps. Cavium processors are supported by ecosystem partners that provide operating systems, tools and application support, hardware reference designs and other products. Cavium is headquartered in San Jose, CA with design centers in California, Massachusetts, India, Israel, China and Taiwan. For more information, please visit: http://www.cavium.com.

Cavium ContactAngel Atondo
Sr. Marketing Communications Manager
Tel: (408) 943-7417
Email:angel.atondo@cavium.com

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Cavium Introduces 10/25GbE Adapter Family for Open Compute Project Servers

QLogic® FastLinQ™ OCP adapters are designed to bring advanced 10/25GbE server connectivity to enterprise,hyperscale cloud service provider and telco data centers

SAN JOSE, CA – Oct. 31, 2016 – Today, Cavium, Inc. (NASDAQ: CAVM), a leading provider of semiconductor products that enable intelligent processing for enterprise and cloud data centers, today unveiled QLogic FastLinQ adapters for Open Compute Project (OCP) servers along with a rich suite of management software. The new line of adapters allows Cavium to extend its reach to the growing number of OCP servers being deployed at hyperscale and cloud service providers.

"New 25GbE technology is expected to displace 10GbE as the standard for server connectivity in the data center. By adding OCP adapters to their portfolio, Cavium expands its ability to address the fastest growing segment of the market, cloud service providers,” said Frank Berry, Senior Analyst, IT Brand Pulse.

“QLogic FastLinQ OCP adapters are designed from the ground up for software defined data centers where server connectivity has become critically important,” said Rajneesh Gaur, general manager and vice president of Ethernet Adapter Group, Cavium. “QLogic FastLinQ Ethernet adapters bring higher bandwidth, lower latency, and offload a long list of networking protocols so that cloud service providers can preserve server resources for workloads that generate revenue.”

Cavium QLogic FastLinQ QL34512 Adapters 
Designed to accelerate Network Virtualization workloads, the FastLinQ QL34512 adapter delivers intelligent offloads for NVGRE, VxLAN and GENEVE tunneling protocols, providing an innovative solution delivering flexibility and cost savings for next generation enterprise, hyperscale CSP, tier 2/3 CSP, and telco data centers. The 10Gb version QL34152HOCU is available today and the 25Gb version scheduled for release in early 2017.

The FastLinQ OCP Ethernet Adapter provides the following key capabilities:

• Accelerates Server Performance: Boosts network performance with full line-rate throughput across both ports, optimizes infrastructure costs and increases virtual machine density by leveraging in-built technologies like SR-IOV and Network Partitioning (NPAR) that deliver acceleration and QoS for tenant workloads and infrastructure traffic. 
• Network Virtualization Offloads – Acceleration for Network Virtualization by offloading protocol processing for VxLAN, NVGRE, GRE and GENEVE, enabling customers to build and scale virtualized networks without impacting network performance.
• Comprehensive Management – Single pane of glass, web-based and distributed adapter management solution with QConvergeConsole® (QCC) available across heterogeneous platforms and OSes, automates and simplifies the deployment and orchestration of physical and virtual infrastructure.
• OpenStack Integration: Cavium QLogic technologies like the Plug-in for Mirantis® Fuel for automatic SR-IOV configuration across multiple OpenStack nodes, QCC driven OpenStack physical and logical topology maps and the ability to deliver QoS for network functions enable hyperscale deployments with Cavium QLogic Ethernet NICs to be accelerated with OpenStack.
• Industry’s Most Comprehensive Network Adapter portfolio – Cavium as a company offers the broadest set of Ethernet networking adapters - FastLinQ™ Standard Ethernet Adapters, Converged Networking Adapters and LiquidIO™ Intelligent NICs that cover the entire spectrum of customer Ethernet connectivity and offload requirements.

For more information go to www.qlogic.com and www.opencompute.org

About OCP:
The OCP is creating a set of technologies that are disaggregated and fully open, allowing for rapid innovation in the data center. The OCP aims to facilitate the development of network hardware and software – together with trusted project validation and testing – in a truly open and collaborative community environment. The OCP project was initiated by Facebook and is now a widely accepted standard.

About Cavium
Cavium, Inc. (NASDAQ: CAVM), offers a broad portfolio of integrated, software compatible processors ranging in performance from 1Gbps to 100Gbp that enable secure, intelligent functionality in Enterprise, Data Center, Broadband, Mobile and Service Provider Equipment, highly programmable switches which scale to 3.2Tbps and Ethernet and Fibre Channel adapters up to 100Gbps. Cavium processors are supported by ecosystem partners that provide operating systems, tools and application support, hardware reference designs and other products. Cavium is headquartered in San Jose, CA with design centers in California, Massachusetts, India, Israel, China and Taiwan.

Media Contact 
Angel Atondo
Sr. Marketing Communications Manager
Telephone: +1 408-943-7417
Email: angel.atondo@cavium.com

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Cavium QLogic Accelerates Cloud Deployments with OpenStack Integration

QLogic® FastLinQ™ Ethernet Adapters and QConvergeConsole® automate OpenStack® Configurations

BARCELONA, SPAIN – Oct. 25, 2016 – Today, Cavium, Inc. (NASDAQ: CAVM), a leading provider of semiconductor products that enable intelligent processing for enterprise and cloud data centers, announced that it is showcasing technologies available for its FastLinQ™ line of 10/25/40/50/100GbE Ethernet adapters that accelerate the deployment of OpenStack by delivering the ability to orchestrate and manage an OpenStack configuration for hybrid and public cloud deployments. QLogic technologies like the Plug-in for Mirantis® Fuel for automatic SR-IOV configuration across multiple OpenStack nodes and QConvergeConsole (QCC) for OpenStack physical and logical topology maps enable hyperscale, private/hybrid and telco cloud deployments with Cavium QLogic Ethernet NICs to be accelerated with OpenStack. In addition, the ability to deliver QoS for network functions with QLogic FastLinQ technology comprise the broad set of technology investments.

Dynamics of Deploying an OpenStack Managed Infrastructure
As the scale of private and public cloud infrastructures grow exponentially, the orchestration of the discreet components that comprise the cloud has becoming increasingly challenging. OpenStack is a scalable, open sourced cloud computing platform that enables the construction of flexible IT infrastructures by bringing a harmony to the discreet but interconnected system, enabling it to be managed as one holistic solution serving storage, compute, and networking needs. While OpenStack has seen tremendous industry acceptance and support, some challenges still remain. The initial deployment and operation of OpenStack, which spans various services and projects and multi-vendor infrastructures, can be a significant hurdle in realizing the full potential of OpenStack. An OpenStack installation can be a manual, time-consuming and often complex process of deploying and configuring discreet hardware components and functions. In addition, current OpenStack inbuilt management services lack the ability to deliver an in-depth view of the interactions between OpenStack components. Customers are demanding a solution to gain better control of an OpenStack infrastructure from initial deployment to ongoing operations.  

QLogic Ethernet Integrations in OpenStack Simplify Deployment and Operation
Realizing the potential of a successful OpenStack deployment and the challenges that such a process entails, Cavium along with the OpenStack community have invested in several key technologies that allow the seamless integration and accelerated deployment of various networking technologies like SR-IOV with OpenStack. In addition, QLogic Ethernet management offerings deliver in-depth visibility of the OpenStack cloud along with the ability to control and guarantee network bandwidth for tenant workloads. Purpose built for accelerating and simplifying OpenStack deployments, these investments include:

• QLogic Plug-in for Mirantis Fuel for Automatic OpenStack Configuration – Single-pane-of-glass capabilities to configure SR-IOV functions across multiple nodes and eliminate manual error prone and time consuming tasks by leveraging the capabilities of the QLogic Plug-in for Mirantis Fuel. This accelerates the virtual network configurations for large scale deployments and is supported by an in-depth step by step installation runbook.
• QConvergeConsole (QCC) enables the visualization of OpenStack Components – With the ability to dynamically map the topology of an OpenStack environment, QLogic QCC enables cloud administrators to visualize the connections between virtual and physical devices, storage volumes and OpenStack services. This unique capability delivers in-depth visibility into OpenStack operations and QLogic networking components to maximize uptime, by giving operations staff the ability to map the OpenStack services interconnected by QLogic FastLinQ technology.
• Quality of Service for Tenant Networking Traffic – QLogic FastLinQ networking technology integrates with OpenStack Liberty to deliver dynamic control over tenant networking's share of the physical infrastructure. With the ability to guarantee network requirements like bandwidth, IaaS/SaaS providers can easily deliver on a strict Service Level Agreement (SLA) to their customers.

Visit the Cavium Booth #B36 at OpenStack Summit Barcelona, Spain to learn more about how OpenStack deployments can leverage QLogic networking technologies.

Supporting Quotes
"QLogic 3400/8400/45000 series of FastLinQ Ethernet adapters support a comprehensive set of virtualization and multi-tenant services for the most sophisticated data centers, telco and cloud providers," said Rajneesh Gaur, general manager and vice president of Ethernet Adapter Group, Cavium. "With integrations into Mirantis Fuel and extensive visibility provided by QConvergeConsole, OpenStack cloud deployments and operations are simplified, accelerating their adoption into hyperscale datacenters."

Cavium QLogic is an OpenStack community member and a corporate sponsor.

For more information, visit:

1. QLogic OpenStack Webpage - http://www.qlogic.com/solutions/Pages/OpenStack.aspx
2. Mirantis Unlocked Partner - https://www.mirantis.com/partners/qlogic/ and http://plugins.mirantis.com/docs/q/l/Fuel-plugin-qlogic-sriov/qlogic-sriov-1.0-1.0.0-1.pdf
3. OpenStack Networking with QoS - http://docs.openstack.org/liberty/networking-guide/adv-config-qos.html
4. QLogic Corporate Website: www.qlogic.com

About Cavium
Cavium, Inc. (NASDAQ: CAVM), is a leading provider of highly integrated semiconductor products that enable intelligent processing in enterprise, data center, cloud and wired and wireless service provider applications. Cavium offers a broad portfolio of integrated, software-compatible products ranging in performance from 100 Mbps to 100 Gbps that enable secure and intelligent functionality for compute, network connectivity, storage and wireless applications. Cavium's processors are supported by ecosystem partners that provide operating systems, tool support, reference designs and other services. Cavium's principal office is in San Jose, CA with design team locations in California, Massachusetts, India and China. For more information, please visit : http://www.cavium.com.

Media Contact
Angel Atondo
Sr. Marketing Communications Manager
Telephone: +1 408-943-7417
Email: angel.atondo@cavium.com

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