Attached files

file filename
8-K - FORM 8-K - ACME PACKET INCb87370e8vk.htm
Exhibit 99.1
     
    (ACME PACKET LOGO)
         
Investor Relations:
      Media and Analyst Contact:
Brian Norris
      CHEN PR
Acme Packet
      Chris Carleton
+1.781.328.4790
      +1.781.672.3115
bnorris@acmepacket.com
      ccarleton@chenpr.com
Acme Packet Reports Record Revenue and Earnings in Second Quarter of 2011
Second Quarter Revenues of $79.7 million, up 49% Year-Over-Year and 8% Sequentially —
Second Quarter GAAP EPS of $0.20, up 43% Year-Over-Year —
Second Quarter Non-GAAP1 EPS of $0.29, up 53% Year-Over-Year —
Company Raises 2011 Revenue and Non-GAAP EPS1 Estimates —
Bedford, Massachusetts — July 21, 2011 — Acme Packet, Inc. (NASDAQ: APKT), the leader in session delivery network solutions, today announced record results for the quarter ended June 30, 2011 and raised its business outlook for 2011. All earnings per share results are on a fully diluted basis unless otherwise noted.
Results for the Second Quarter of 2011
Total revenue in the second quarter of 2011 was $79.7 million, compared to $53.3 million in the second quarter of 2010 and $74.0 million in the first quarter of 2011. Net income in the second quarter of 2011 was $14.0 million, or $0.20 per share, compared to $9.7 million, or $0.14 per share, in the second quarter of 2010 and $13.7 million, or $0.19 per share, in the first quarter of 2011. Net income on a non-GAAP1 basis in the second quarter of 2011 was $20.4 million, or $0.29 per share, compared to $12.5 million, or $0.19 per share, in the second quarter of 2010, and $18.9 million, or $0.27 per share, in the first quarter of 2011.

 


 

Company Raises Business Outlook for 2011
The Company today raised its business outlook for 2011. The Company’s outlook is based on the current indications for its business, which may change at any time. A reconciliation of the Company’s expected GAAP to non-GAAP business outlook, and a statement as to the use of non-GAAP financial measures, is included at the end of this press release.
             
    Business Outlook for Year Ending December 31, 2011    
Estimate   Issued April 26, 2011   Issued July 21, 2011    
     
Total revenue (in millions)
   $310-$315    $315-$320    
 
           
Total revenue growth rate
  Approximately 35%   Approximately 36%-38%    
 
           
Non-GAAP1 EPS
   $1.10-$1.15    $1.14-$1.18    
 
           
Total non-GAAP1 EPS growth rate
  Approximately 40%   Approximately 43%-48%    
 
           
Diluted share count (in millions)
   71.5    71.5    
Company to Host Live Conference Call and Webcast
The Company’s management team plans to host a live conference call and webcast at 4:30 p.m. eastern time today to discuss the financial results as well as management’s outlook for the business. The conference call may be accessed in the United States by dialing 1.800.230.1093 and using access code “APKT”. The conference call may be accessed outside of the United States by dialing +1.612.288.0337 and using access code “APKT”. The conference call will be simultaneously webcast on the Company’s investor relations website, which can be accessed at www.ir.acmepacket.com. A replay of the conference call will be available approximately two hours after the call by dialing 1.800.475.6701 or +1.320.365.3844 and using access code 209417 or by accessing the webcast replay on the Company’s investor relations website.
 
1     A reconciliation of GAAP to non-GAAP results, and a statement on the use of non-GAAP financial measures, is included at the end of this press release.
About Acme Packet
Acme Packet (NASDAQ: APKT), the leader in session delivery network solutions, enables the trusted, first-class delivery of next-generation voice, data and unified communications services and applications across IP networks. Our Net-Net product family fulfills demanding security, service assurance and regulatory requirements in service provider, enterprise and contact center networks. Based in Bedford, Massachusetts, Acme Packet designs and manufactures its products in the USA, selling them through over 150 reseller partners worldwide. More than 1,440 customers in 105 countries have deployed over 13,000 Acme Packet systems, including 90 of the top 100 service providers and 34 of the Fortune 100. For more information visit www.acmepacket.com.

 


 

Acme Packet, Inc. Safe Harbor Statement
Statements contained herein that are not historical fact (including those in the section “Company Raises Business Outlook for 2011”) may be forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Such forward-looking statements may relate to, among other things, expected financial and operating results, expected growth rates, future stock-based compensation and amortization expenses, future business prospects and market conditions. Such forward-looking statements do not constitute guarantees of future performance and are subject to a variety of risks and uncertainties that could cause actual results to differ materially from those anticipated. These include, but are not limited to: the amount of stock-based compensation awarded; the applicable Company stock price used to determine stock-based compensation; the exercise pattern of employee stock options; difficulties expanding the Company’s customer base; difficulties leveraging market opportunities; difficulties providing solutions that meet the needs of customers; poor product sales; long sales cycles; difficulties developing new products; difficulties in relationships with vendors and partners; higher risks in international operations; difficulties managing rapid growth; difficulties managing the Company’s financial performance; the ability to hire and retain employees and appropriately staff operations; the Company’s cash needs; the impact of new accounting pronouncements and increased competition. Additional factors that could cause actual results to differ materially from those projected or suggested in any forward-looking statements are contained in the Company’s recent filings with the Securities and Exchange Commission, including those factors discussed under the caption “Risk Factors” in such filings.

 


 

Acme Packet, Inc.
Condensed Consolidated Statements of Income
(in thousands, except share and per share data)
(unaudited)
                                 
    Three Months Ended June 30,     Six Months Ended June 30,  
    2011     2010     2011     2010  
Revenue:
                               
Product
  $ 64,688     $ 42,031     $ 124,430     $ 84,124  
Maintenance, support and service
    15,045       11,305       29,270       20,262  
 
                       
Total revenue
    79,733       53,336       153,700       104,386  
 
                       
 
                               
Cost of revenue:
                               
Product
    11,367       7,434       21,312       14,983  
Maintenance, support and service
    2,525       2,140       5,531       4,408  
 
                       
Total cost of revenue
    13,892       9,574       26,843       19,391  
 
                       
 
                               
Gross profit
    65,841       43,762       126,857       84,995  
 
                       
 
                               
Operating expenses:
                               
Sales and marketing
    24,736       16,623       48,439       33,050  
Research and development
    12,719       8,646       24,013       17,339  
General and administrative
    5,788       3,595       10,365       6,879  
Merger and integration-related costs
                180        
 
                       
Total operating expenses
    43,243       28,864       82,997       57,268  
 
                       
 
                               
Income from operations
    22,598       14,898       43,860       27,727  
 
                               
Other (expense) income, net
    (196 )     176       (94 )     165  
 
                       
 
                               
Income before provision for income taxes
    22,402       15,074       43,766       27,892  
 
                               
Provision for income taxes
    8,394       5,345       16,049       9,830  
 
                       
 
                               
Net income
  $ 14,008     $ 9,729     $ 27,717     $ 18,062  
 
                       
 
                               
Net income per share:
                               
Basic
  $ 0.21     $ 0.16     $ 0.42     $ 0.30  
Diluted
  $ 0.20     $ 0.14     $ 0.39     $ 0.27  
 
                               
Weighted average number of common shares used in the calculation of net income per share:
                               
Basic
    66,141,163       61,488,059       65,623,359       60,659,321  
Diluted
    71,033,614       67,184,884       70,839,456       66,118,943  
 
                               
Margin:
                               
Gross margin
    82.6 %     82.0 %     82.5 %     81.4 %
Operating margin
    28.3 %     27.9 %     28.5 %     26.6 %
Net margin
    17.6 %     18.2 %     18.0 %     17.3 %

 


 

Acme Packet, Inc.
Condensed Consolidated Balance Sheets
(in thousands)
(unaudited)
                 
    June 30,     December 31,  
    2011     2010  
Assets
               
Current assets:
               
Cash and cash equivalents
  $ 120,571     $ 91,669  
Short-term investments
    192,855       179,024  
Accounts receivable, net
    53,520       34,797  
Inventory
    9,721       6,662  
Deferred product costs
    1,048       3,572  
Deferred tax asset
    3,814       3,814  
Income taxes receivable
    14,131       9,979  
Other current assets
    4,760       3,231  
 
           
Total current assets
    400,420       332,748  
Long-term investments
    5,000       5,030  
Property and equipment, net
    21,282       17,156  
Acquired intangible assets, net
    9,592       9,468  
Goodwill
    3,269        
Deferred tax asset, net
    14,802       14,802  
Other assets
    320       940  
 
           
Total assets
  $ 454,685     $ 380,144  
 
           
 
               
Liabilities and Stockholders’ Equity
               
Current liabilities:
               
Accounts payable
  $ 8,372     $ 7,161  
Accrued expenses and other current liabilities
    9,591       14,629  
Deferred revenue
    32,897       31,998  
 
           
Total current liabilities
    50,860       53,788  
 
           
 
               
Deferred revenue
    1,999       1,546  
 
           
Deferred rent
    4,584       4,265  
 
           
 
               
Stockholders’ equity:
               
Common stock
    73       71  
Additional paid-in capital
    315,094       266,114  
Treasury stock, at cost
    (37,522 )     (37,522 )
Other comprehensive income
    32       34  
Retained earnings
    119,565       91,848  
 
           
Total stockholders’ equity
    397,242       320,545  
 
           
Total liabilities and stockholders’ equity
  $ 454,685     $ 380,144  
 
           
Condensed Consolidated Statements of Cash Flow
(in thousands)
(unaudited)
                                 
    Three Months Ended     Six Months Ended  
    June 30,     June 30,  
    2011     2010     2011     2010  
Cash provided by operating activities
  $ 8,664     $ 15,061     $ 20,205     $ 23,034  
Cash used in investing activities
    20,729       22,541       25,002       49,182  
Cash provided by financing activities
    13,712       17,443       33,699       26,210  

 


 

Acme Packet, Inc.
Statement on Use of Non-GAAP Financial Measures and
Reconciliation of Non-GAAP Net Income and Non-GAAP Net Income Per Share
(in thousands, except share and per share data)
(unaudited)
          Statement on Use of Non-GAAP Financial Measures:
          To supplement its condensed consolidated financial statements presented in accordance with accounting principles generally accepted in the United States (“GAAP”), the Company discloses certain non-GAAP financial measures, including “non-GAAP net income”, “net income on a non-GAAP basis”, “non-GAAP net income per share”, “non-GAAP EPS” and “net income per share on a non-GAAP basis”. These non-GAAP financial measures are not presented in accordance with GAAP and are not meant to be a substitute for the most directly comparable GAAP measures of “net income”, “EPS” or “net income per share”. Rather, these non-GAAP financial measures should be evaluated in conjunction with its most directly comparable GAAP financial measure and the Company’s financial statements as a whole.
     Management uses these supplemental non-GAAP financial measures to evaluate performance period over period, to analyze the underlying trends in the Company’s business, to assess its performance relative to its competitors, and to establish operational goals and forecasts that are used in allocating resources. Management uses these non-GAAP financial measures because they exclude stock-based compensation expense which is a non-cash charge and related payroll taxes, as well as amortization of acquired intangible assets and merger and integration-related costs associated with the Company’s acquisition activities, all of which are non-operational costs and expenses. By excluding stock-based compensation expense and related payroll taxes, amortization of acquired intangible assets, and merger and integration-related costs, management can compare the Company’s operations to prior periods and to the operations of other companies in its industry who may have materially different unusual, non-operational charges. Management does not consider any of stock-based compensation expense and related payroll taxes, amortization of acquired intangible assets, and merger and integration-related costs to be part of the Company’s operating activities or meaningful in evaluating the Company’s past financial performance or future prospects. Management believes that excluding these items is useful to investors because it is more representative of ongoing costs and therefore more comparable to historical operations.
     Because management uses them, management believes that the disclosure of these non-GAAP financial measures to investors provides greater transparency and useful information to help the investor better understand the Company’s operating performance and to evaluate the methodology used by management to evaluate and measure such performance. Notwithstanding their utility to investors in understanding operational trends, these non-GAAP measures should not be considered measures of the Company’s liquidity. In addition, the Company cautions that its definition of “non-GAAP net income”, “non-GAAP EPS” and “non-GAAP net income per share” may differ from similar measures used by other companies and may differ from period to period. Also, in future periods, management may make other adjustments for expenses and gains that it does not consider reflective of core operating performance in a particular period thereby modifying its definition of “non-GAAP net income”, “non-GAAP EPS” and “non-GAAP net income per share” by excluding these other or additional expenses and gains.

 


 

Acme Packet, Inc.
Non-GAAP Condensed Consolidated Statements of Income
(in thousands, except share and per share data)
(unaudited)
                                 
    Three Months Ended June 30,     Six Months Ended June 30,  
    2011     2010     2011     2010  
Revenue:
                               
Product
  $ 64,688     $ 42,031     $ 124,430     $ 84,124  
Maintenance, support and service
    15,045       11,305       29,270       20,262  
 
                       
Total revenue
    79,733       53,336       153,700       104,386  
 
                       
 
                               
Cost of revenue:
                               
Product
    10,504       6,864       19,816       13,861  
Maintenance, support and service
    2,026       1,897       4,581       3,933  
 
                       
Total cost of revenue
    12,530       8,761       24,397       17,794  
 
                       
 
                               
Gross profit
    67,203       44,575       129,303       86,592  
 
                       
 
                               
Operating expenses:
                               
Sales and marketing
    20,155       14,750       40,233       29,550  
Research and development
    10,056       7,416       19,096       14,923  
General and administrative
    4,485       3,072       8,082       5,930  
 
                       
Total operating expenses
    34,696       25,238       67,411       50,403  
 
                       
 
                               
Income from operations
    32,507       19,337       61,892       36,189  
 
                               
Other (expense) income, net
    (196 )     176       (94 )     165  
 
                       
 
                               
Income before provision for income taxes
    32,311       19,513       61,798       36,354  
 
                               
Provision for income taxes
    11,881       7,043       22,429       13,171  
 
                       
 
                               
Net income
  $ 20,430     $ 12,470     $ 39,369     $ 23,183  
 
                       
 
                               
Net income per share:
                               
Basic
  $ 0.31     $ 0.20     $ 0.60     $ 0.38  
Diluted
  $ 0.29     $ 0.19     $ 0.56     $ 0.35  
 
                               
Weighted average number of common shares used in the calculation of net income per share:
                               
Basic
    66,141,163       61,488,059       65,623,359       60,659,321  
Diluted
    71,033,614       67,184,884       70,839,456       66,118,943  
 
                               
Margin:
                               
Gross margin
    84.3 %     83.6 %     84.1 %     83.0 %
Operating margin
    40.8 %     36.3 %     40.3 %     34.7 %
Net margin
    25.6 %     23.4 %     25.6 %     22.2 %

 


 

Reconciliation of Non-GAAP Net Income and Non-GAAP Net Income Per Share for the Three Months Ended June 30, 2011, March 31, 2011, and June 30, 2010 and the Six Months Ended June 30, 2011 and June 30, 2010 (unaudited):
Acme Packet, Inc.
GAAP to Non-GAAP Reconciliation
Three Months Ended June 30, 2011
(in thousands, except share and per share data)
(unaudited)
                                 
    GAAP     Stock-based
compensation
expense and
related payroll
taxes
    Amortization of
acquired
intangible
assets
      Non-GAAP1  
     
Revenue:
                               
Product
  $ 64,688     $     $     $ 64,688  
Maintenance, support and service
    15,045                   15,045  
 
                       
Total revenue
    79,733                   79,733  
 
                       
 
                               
Cost of revenue:
                               
Product
    11,367       (327 )     (536 )     10,504  
Maintenance, support and service
    2,525       (499 )           2,026  
 
                       
Total cost of revenue
    13,892       (826 )     (536 )     12,530  
 
                       
 
                               
Gross profit
    65,841       826       536       67,203  
 
                       
 
                               
Operating expenses:
                               
Sales and marketing
    24,736       (4,441 )     (140 )     20,155  
Research and development
    12,719       (2,652 )     (11 )     10,056  
General and administrative
    5,788       (1,303 )           4,485  
 
                       
Total operating expenses
    43,243       (8,396 )     (151 )     34,696  
 
                       
 
                               
Income from operations
    22,598       9,222       687       32,507  
 
                               
Other (expense), net
    (196 )                 (196 )
 
                       
 
                               
Income before provision for income taxes
    22,402       9,222       687       32,311  
 
                               
Provision for income taxes
    8,394       3,241       246       11,881  
 
                       
 
                               
Net income
  $ 14,008     $ 5,981     $ 441     $ 20,430  
 
                       
Net income per share:
                               
Basic
  $ 0.21     $ 0.09     $ 0.01     $ 0.31  
Diluted
  $ 0.20     $ 0.08     $ 0.01     $ 0.29  
 
                               
Weighted average number of common shares used in the calculation of net income per share:
                               
Basic
    66,141,163       66,141,163       66,141,163       66,141,163  
Diluted
    71,033,614       71,033,614       71,033,614       71,033,614  
 
                               
Margin:
                               
Gross margin
    82.6 %                     84.3 %
Operating margin
    28.3 %                     40.8 %
Net margin
    17.6 %                     25.6 %

 


 

Acme Packet, Inc.
GAAP to Non-GAAP Reconciliation
Three Months Ended June 30, 2010
(in thousands, except share and per share data)
(unaudited)
                                 
            Stock-based              
            compensation     Amortization of        
            expense and     acquired        
            related payroll     intangible        
    GAAP     taxes     assets     Non-GAAP1  
     
Revenue:
                               
Product
  $ 42,031     $     $     $ 42,031  
Maintenance, support and service
    11,305                   11,305  
 
                       
Total revenue
    53,336                   53,336  
 
                       
 
                               
Cost of revenue:
                               
Product
    7,434       (191 )     (379 )     6,864  
Maintenance, support and service
    2,140       (243 )           1,897  
 
                       
Total cost of revenue
    9,574       (434 )     (379 )     8,761  
 
                       
 
                               
Gross profit
    43,762       434       379       44,575  
 
                       
 
                               
Operating expenses:
                               
Sales and marketing
    16,623       (1,828 )     (45 )     14,750  
Research and development
    8,646       (1,219 )     (11 )     7,416  
General and administrative
    3,595       (523 )           3,072  
 
                       
Total operating expenses
    28,864       (3,570 )     (56 )     25,238  
 
                       
 
                               
Income from operations
    14,898       4,004       435       19,337  
 
                               
Other income, net
    176                   176  
 
                       
 
                               
Income before provision for income taxes
    15,074       4,004       435       19,513  
 
                               
Provision for income taxes
    5,345       1,544       154       7,043  
 
                       
 
                               
Net income
  $ 9,729     $ 2,460     $ 281     $ 12,470  
 
                       
 
                               
Net income per share:
                               
Basic
  $ 0.16     $ 0.04     $ 0.00     $ 0.20  
Diluted
  $ 0.14     $ 0.04     $ 0.00     $ 0.19  
 
                               
Weighted average number of common shares used in the calculation of net income per share:
                               
Basic
    61,488,059       61,488,059       61,488,059       61,488,059  
Diluted
    67,184,884       67,184,884       67,184,884       67,184,884  
 
                               
Margin:
                               
Gross margin
    82.0 %                     83.6 %
Operating margin
    27.9 %                     36.3 %
Net margin
    18.2 %                     23.4 %

 


 

Acme Packet, Inc.
GAAP to Non-GAAP Reconciliation
Six Months Ended June 30, 2011
(in thousands, except share and per share data)
(unaudited)
                                         
            Stock-based                    
            compensation     Amortization of              
            expense and     acquired     Merger and        
            related payroll     intangible     integration-        
    GAAP     taxes     assets     related costs     Non-GAAP1  
     
Revenue:
                                       
Product
  $ 124,430     $     $     $     $ 124,430  
Maintenance, support and service
    29,270                         29,270  
 
                             
Total revenue
    153,700                         153,700  
 
                             
 
                                       
Cost of revenue:
                                       
Product
    21,312       (589 )     (907 )           19,816  
Maintenance, support and service
    5,531       (950 )                 4,581  
 
                             
Total cost of revenue
    26,843       (1,539 )     (907 )           24,397  
 
                             
 
                                       
Gross profit
    126,857       1,539       907             129,303  
 
                             
 
                                       
Operating expenses:
                                       
Sales and marketing
    48,439       (8,020 )     (186 )           40,233  
Research and development
    24,013       (4,894 )     (23 )           19,096  
General and administrative
    10,365       (2,283 )                 8,082  
Merger and integration-related costs
    180                   (180 )     -  
 
                             
Total operating expenses
    82,997       (15,197 )     (209 )     (180 )     67,411  
 
                             
 
                                       
Income from operations
    43,860       16,736       1,116       180       61,892  
 
                                       
Other (expense), net
    (94 )                       (94 )
 
                             
 
                                       
Income before provision for income taxes
    43,766       16,736       1,116       180       61,798  
 
                                       
Provision for income taxes
    16,049       5,978       402             22,429  
 
                             
 
                               
Net income
  $ 27,717     $ 10,758     $ 714     $ 180     $ 39,369  
 
                             
 
                                       
Net income per share:
                                       
Basic
  $ 0.42     $ 0.16     $ 0.01     $ 0.00     $ 0.60  
Diluted
  $ 0.39     $ 0.15     $ 0.01     $ 0.00     $ 0.56  
 
                                       
Weighted average number of common shares used in the calculation of net income per share:
                                       
Basic
    65,623,359       65,623,359       65,623,359       65,623,359       65,623,359  
Diluted
    70,839,456       70,839,456       70,839,456       70,839,456       70,839,456  
 
                                       
Margin:
                                       
Gross margin
    82.5 %                             84.1 %
Operating margin
    28.5 %                             40.3 %
Net margin
    18.0 %                             25.6 %

 


 

Acme Packet, Inc.
GAAP to Non-GAAP Reconciliation
Six Months Ended June 30, 2010
(in thousands, except share and per share data)
(unaudited)
                                 
            Stock-based              
            compensation     Amortization of        
            expense and     acquired        
            related payroll     intangible        
    GAAP     taxes     assets     Non-GAAP1  
     
Revenue:
                               
Product
  $ 84,124     $     $     $ 84,124  
Maintenance, support and service
    20,262                   20,262  
 
                       
Total revenue
    104,386                   104,386  
 
                       
 
                               
Cost of revenue:
                               
Product
    14,983       (364 )     (758 )     13,861  
Maintenance, support and service
    4,408       (475 )           3,933  
 
                       
Total cost of revenue
    19,391       (839 )     (758 )     17,794  
 
                       
 
                               
Gross profit
    84,995       839       758       86,592  
 
                       
 
                               
Operating expenses:
                               
Sales and marketing
    33,050       (3,410 )     (90 )     29,550  
Research and development
    17,339       (2,394 )     (22 )     14,923  
General and administrative
    6,879       (949 )           5,930  
 
                       
Total operating expenses
    57,268       (6,753 )     (112 )     50,403  
 
                       
 
                               
Income from operations
    27,727       7,592       870       36,189  
 
                               
Other income, net
    165                   165  
 
                       
 
                               
Income before provision for income taxes
    27,892       7,592       870       36,354  
 
                               
Provision for income taxes
    9,830       3,035       306       13,171  
 
                       
 
                               
Net income
  $ 18,062     $ 4,557     $ 564     $ 23,183  
 
                       
 
                               
Net income per share:
                               
Basic
  $ 0.30     $ 0.08     $ 0.01     $ 0.38  
Diluted
  $ 0.27     $ 0.07     $ 0.01     $ 0.35  
 
                               
Weighted average number of common shares used in the calculation of net income per share:
                               
Basic
    60,659,321       60,659,321       60,659,321       60,659,321  
Diluted
    66,118,943       66,118,943       66,118,943       66,118,943  
 
                               
Margin:
                               
Gross margin
    81.4 %                     83.0 %
Operating margin
    26.6 %                     34.7 %
Net margin
    17.3 %                     22.2 %

 


 

Acme Packet, Inc.
GAAP to Non-GAAP Reconciliation
Three Months Ended March 31, 2011
(in thousands, except share and per share data)
(unaudited)
                                         
            Stock-based            
            compensation   Amortization of        
            expense and   acquired   Merger and    
            related payroll   intangible   integration-    
    GAAP   taxes   assets   related costs   Non-GAAP1
     
Revenue:
                                       
Product
  $ 59,742     $     $     $     $ 59,742  
Maintenance, support and service
    14,225                         14,225  
 
                                       
Total revenue
    73,967                         73,967  
 
                                       
 
                                       
Cost of revenue:
                                       
Product
    9,945       (262 )     (371 )           9,312  
Maintenance, support and service
    3,006       (451 )                 2,555  
 
                                       
Total cost of revenue
    12,951       (713 )     (371 )           11,867  
 
                                       
 
                                       
Gross profit
    61,016       713       371             62,100  
 
                                       
 
                                       
Operating expenses:
                                       
Sales and marketing
    23,703       (3,579 )     (46 )           20,078  
Research and development
    11,294       (2,242 )     (12 )           9,040  
General and administrative
    4,577       (980 )                 3,597  
Merger and integration-related costs
    180                   (180 )      
 
                                       
Total operating expenses
    39,754       (6,801 )     (58 )     (180 )     32,715  
 
                                       
 
                                       
Income from operations
    21,262       7,514       429       180       29,385  
 
                                       
Other income, net
    102                         102  
 
                                       
 
                                       
Income before provision for income taxes
    21,364       7,514       429       180       29,487  
 
                                       
Provision for income taxes
    7,655       2,737       156             10,548  
 
                                       
 
                                       
Net income
  $ 13,709     $ 4,777     $ 273     $ 180     $ 18,939  
 
                                       
 
                                       
Net income per share:
                                       
Basic
  $ 0.21     $ 0.07     $ 0.00     $ 0.00     $ 0.29  
Diluted
  $ 0.19     $ 0.07     $ 0.00     $ 0.00     $ 0.27  
 
                                       
Weighted average number of common shares used in the calculation of net income per share:
                                       
Basic
    65,076,303       65,076,303       65,076,303       65,076,303       65,076,303  
Diluted
    70,476,973       70,476,973       70,476,973       70,476,973       70,476,973  
 
                                       
Margin:
                                       
Gross margin
    82.5 %                             84.0 %
Operating margin
    28.7 %                             39.7 %
Net margin
    18.5 %                             25.6 %

 


 

     Reconciliation of Expected Non-GAAP Net Income and Non-GAAP Net Income Per Share for the Year Ending December 31, 2011 (unaudited):
                 
    Twelve Months Ending  
    December 31, 2011  
    (unaudited)  
    (in thousands, except per share data)  
    Low     High  
     
Revenue
  $ 315,000     $ 320,000  
 
               
Reconciliation of non-GAAP net income:
               
Net income
  $ 55,800     $ 58,700  
Adjustments:
               
Stock-based compensation expense and related payroll taxes, net of taxes
    24,100       24,100  
Amortization of acquired intangible assets, net of taxes
    1,200       1,200  
Merger and integration-related costs
    180       180  
 
           
Non-GAAP net income
  $ 81,200     $ 84,100  
 
           
 
               
Reconciliation of diluted non-GAAP net income per share:
               
Net income per share
  $ 0.78     $ 0.82  
Adjustments:
               
Stock-based compensation expense and related payroll taxes, net of taxes
    0.34       0.34  
Amortization of acquired intangible assets, net of taxes
    0.02       0.02  
Merger and integration-related costs
    0.00       0.00  
 
           
Non-GAAP net income per share
  $ 1.14     $ 1.18  
 
           
Acme Packet, Inc.
Other Operational Data
(unaudited)
                                         
    Three Months Ended     Six Months Ended  
    June 30,     March 31,     June 30,     June 30,     June 30,  
    2011     2011     2010     2011     2010  
Other operational data:
                                       
Depreciation and amortization (in thousands)
  $ 1,894     $ 2,358     $ 1,908     $ 4,252     $ 3,761  
Capital expenditures (in thousands)
    2,598       4,644       3,300       7,242       6,067  
Days sales outstanding
    60       53       46              
Total headcount
    710       641       503              
Quarterly inventory turnover — annualized
    5.42       5.79       5.39