MoSys Inc. (NASDAQ:MOSY) posted financial report for the fourth quarter closed December 31, 2017 and a change to its senior secured convertible notes. Total net revenue for Q4 2017 came at $3.8 million, as against $2.5 million for Q3 2017 and $1.4 million for Q4 2016. For FY2017, total net revenue came at around $8.8 million, as against $6 million for FY2016. Product revenue for Q4 2017 was $3.5 million versus $2.2 million in Q3 2017 and $1 million in the same period, a year ago. For FY2017, product revenue came at $7.8 million compared to $4.6 million in 2016.
Len Perham, the CEO and President of MoSys, expressed that Q4 2017 showcased continued progress across their business, leading in product revenue surging around 60% sequentially and 70% over FY2016. IC revenue increase in Q4 2017 was mainly led by Bandwidth Engine II unit shipments, directed by their largest consumers in the networking market and security appliance divisions. In addition, they shipped Bandwidth Engine III prototype quantities to initial consumers. They anticipate to launch Bandwidth Engine III to production in mid-2018, and remain to track numerous prospective design wins for this latest product, and for Bandwidth Engine II and the Programmable Search Engine portfolio.
The CEO of MoSys expressed that during the quarter, their results gained from the cost reduction and restructuring initiatives they implemented throughout 2017, leading in operating expenses declining around 20% sequentially. They also continued to record progress increasing operational and manufacturing efficiencies to enhance their gross margins and support their prospective and current customers. They anticipate gross margins to enhance in 2018 and surpass 50%, as they benefit from these efficiencies, enhanced utilization of their production capacity, and contribution from licensing and royalties.
Mr. Perham added that 2017 was an important year that will offer a solid base for sustained growth in 2018, with their major consumers continuing to increase production. Bandwidth Engine II will remain their main revenue driver, and they project preliminary revenue support from Bandwidth Engine III production late in 2018.