Apple iPod SOC Provider Prepares for IPO

Online staff -- Electronic News, 8/12/2004

On the success and proliferation of digital media content, increasing Internet-based content distribution, greater storage capacity and increasing functionality of devices, Apple iPod SOC provider PortalPlayer is preparing to file for its initial public offering.

Fabless semiconductor provider PortalPlayer touts a platform for hard disk drive-based personal media players that include an SOC, firmware and software. Incorporated in 1999 in Santa Clara, Calif., the company has experienced significant growth -- revenue increased from $1.9 million in 2001 to $8.8 million in 2002, $20.9 million in 2003 and to $22.2 million for the six months ended June 30.

While Apple iPod ODM Inventec Appliances (Shanghai) Co. Ltd./Inventec Appliances Corp. accounts for most of the company’s revenue, other customers have included Bang and Olufsen, Kaga Electronics Co., Philips Consumer Electronics, Samsung Bluetek Co., Thomson Multimedia (RCA) and Wistron Corp. with its platforms included in products branded by Aiwa, Philips, Rio and Samsung.

Although the number of shares included in the IPO has not yet been set, net proceeds would be used to repay bank loans of $4.4 million, with the remainder serving as working capital, the company said.

PortalPlayer expects competition from a large number of players, including Intel, Philips Semiconductor, SigmaTel, Telechips and Texas Instruments, which have traditionally focused on flash-based players, according to the company’s SEC S-1 filing.

The company has 134 full-time employees located in Santa Clara, Calif.; Kirkland, Wash.; Charlotte, N.C.; Taiwan; Japan; and Hyderabad, India.