Although we don’t believe in timing the market or panicking over market movements, we do like to keep an eye on big changes—just in case they’re material to our investing thesis.

What: Shares of NetLogic Microsystems (Nasdaq: NETL), which chiefly makes chips that power high-speed networking gear, are soaring as much as 13.8% above last night's closing price on heavy trading volume.

So what: NetLogic's fourth-quarter report beat analyst expectations by a small margin on the revenue line but with a much larger gap on the bottom line. Management credits strong sales to Huawei and Alcatel-Lucent for much of the outperformance, while the order patterns from largest customer Cisco Systems didn't shock one way or the other.

Now what: The Huawei and Alcatel-Lucent accounts are particularly attractive because the companies tend to order advanced, high-margin chips that are good for NetLogic's margins. Rollouts of 4G networks here and across the globe are fueling strong demand for NetLogic's high-end networking chips, and the company is working down its inventory levels very quickly. As a result of all this success, the stock continues to explore brand-new all-time highs.

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