Financial Analysis of Microtune, Inc.
This case analysis is a financial analysis of Microtune, Inc. (hereafter referred to as Microtune). Our team did not have any members who had access to information about a company that facilitated a managerial review. However, one team member is familiar with Microtune, a semiconductor company, as well as its business environment. Public information about Microtune is readily available, and the team felt able to conduct a thorough financial analysis based upon the nature of the information obtained. .
Microtune was founded in 1996 with the vision of producing silicon system-on-a-chip solutions for radio frequency (RF) and baseband applications. They introduced their first product for sale in 1999, offering their patented MicroTuner system-on-a-chip silicon tuner for radio and television applications. The company had their initial public offering in 2000 and expanded their business by purchasing Temic Telefunken Hochfrequenztechnik GmbH (Temic), a German tuner assembly design group that included a tuner can assembly plant in the Philippines. Microtune expanded again in 2001 to include a digital signal processing design center in the Netherlands, SPaSE, and a wireless design center in California, Transilica. The companys current product lines include not only wireline products such as cable set-top box tuners and cable modem tuners, but also wireless products such as 802.11b wireless USB connectors and cellular telephone headsets. Microtune currently holds twenty-four U.S. patents with fifty applications pending.
In a general sense, Microtune competes in the semiconductor market it designs silicon chips for sale to consumer end-product manufacturers. While the manufacture of semiconductors in-and-of-itself is not a fast-changing industry, the design of semiconductors is an industry in which new innovations and products are introduced with great frequency.