China Digital TV has announced strong demand for its conditional access (CA) systems in its unaudited financial results for the first quarter of 2011 ended 31 March.
Net revenues in the first quarter of 2011 were US$19.3m, representing a 37.7% increase from the first quarter in 2010 and a 41.2% decrease from the fourth quarter of 2010.
The company shipped approximately 3.63 million smart cards during the first quarter of 2011, compared with 2.57 million and 6.10 million smart cards in the first quarter of 2010 and the fourth quarter of 2010, respectively.
Gross margin in the first quarter was 79.5%, compared with 77.5% in the same period in 2010 and 80.8% in the fourth quarter of 2010.
Jianhua Zhu, China Digital TV's chairman and chief executive officer, said: "In line with our projections, cable television operators remained keen on investing in digitalisation projects during the first quarter of 2011.
“Continued demand and stable prices for smart cards spurred another strong quarter, with an approximately 40% increase in both shipments and revenues compared with the first quarter of 2010.
"We are particularly encouraged to have further extended our market share to 61.8% in the first quarter of 2011 from 59.1% in the fourth quarter of 2010, owing to our focus on customer base expansion and day-to-day execution.
“We believe that solidifying our leadership in CA systems not only protects us against short-term fluctuations in smart card demand caused by cable industry consolidation, but will also enhance our opportunities when China's digital television market is ready for next generation products."
Zhenwen Liang, China Digital TV's chief financial officer, added: "A balanced approach to operational efficiency and investment has enabled us to sustain profitable growth.
"We will continue to invest in research and development for new products and services in a number of areas to expand our revenue sources in the years ahead."