Attached files
| file | filename |
|---|---|
| 8-K - FORM 8-K - APPLIED MICRO CIRCUITS CORP | d8k.htm |
| EX-99.2 - TRANSCRIPT OF CONFERENCE CALL - APPLIED MICRO CIRCUITS CORP | dex992.htm |
Exhibit 99.1
| FOR ADDITIONAL INFORMATION: | ||
| Investor Relations Contact: | Media Contact: | |
| Applied Micro Circuits Corporation | Applied Micro Circuits Corporation | |
| Bob Gargus | Tally Kaplan-Porat | |
| Phone: (408) 542-8752 | Phone: (408) 702-3139 | |
| E-Mail: rgargus@apm.com | E-Mail: tkaplan@apm.com | |
Thursday, July 28, 2011
Company Press Release
APPLIED MICRO CIRCUITS CORPORATION REPORTS
FIRST QUARTER FISCAL 2012 FINANCIAL RESULTS
SUNNYVALE, Calif., — July 28, 2011—Applied Micro Circuits Corporation [NASDAQ: AMCC] (“AppliedMicro”) today reported its financial results for the first quarter of fiscal 2012, ended June 30, 2011.
| • | Q1 2012 net revenues were $60.8 million, up 4% sequentially and up 0.1% year over year. |
| • | Q1 2012 GAAP net loss was $6.9 million or $0.11 per share compared to net loss of $4.0 million or $0.06 per share for the fourth quarter of fiscal 2011. |
| • | Q1 2012 non-GAAP EPS was $0.01 per share on net income of $0.6 million, compared to $0.04 per share on net income of $2.7 million, from continuing operations, for the fourth quarter of fiscal 2011. |
| • | Total cash, cash equivalents and short-term investments was approximately $142 million as of June 30, 2011 compared to $168 million as of March 31, 2011. The decrease in cash is mainly due to stock buyback contracts and investment in working capital. |
| • | During the quarter, the Company announced the introduction of the following products: |
| • | APM86491 a high-performance System-on-a-Chip (SoC) featuring a 1.2GHz PowerPC® 465 processing core for advanced Network Attached Storage (NAS), Wireless Access Point (WAP) and media gateway systems for the connected home market. The APM86491 offers twice the performance of competing devices, reduced bill-of-materials (BOM) cost and energy-efficient power consumption as low as 2.5W to bring enterprise-class performance to consumer systems. |
| • | APM86791 PacketPro™ Gen2 embedded processor aimed at growing network transport, enterprise and consumer markets. The APM86791 is designed to deliver the industry’s most advanced but cost effective network security measures for enhanced protection against intrusion threats, system hacking and theft of system-level intellectual property. The APM86791 leverages AppliedMicro’s SLIMpro™ Trusted Management Module (TMM) to offer multi-layered encryption and authentication capabilities that manufacturers and network administrators need to make systems impervious to the most sophisticated attacks on security keys, proprietary software code and hardware. |
| • | S28010 Gearbox integrated circuit devices for 100 Gigabit Ethernet CFP client optical interfaces. As the industry’s first single-chip CMOS offering, the S28010 enables cost-effective, power-efficient 100GBASE-R4 optical modules to expand connection speeds from 10Gbps to 100Gbps for high-end switching and routing equipment. |
Net revenues for the first quarter of fiscal 2012 were $60.8 million compared to $58.6 million in the fourth quarter of fiscal 2011, representing a sequential increase of 3.8% and an increase of 0.1% over the $60.8 million in net revenues reported in the first quarter of fiscal 2011.
The net loss on a generally accepted accounting principles (GAAP) basis for the first quarter of fiscal 2012 was $6.9 million or $0.11 per share. The first quarter GAAP net loss compares with a net loss of $4.0 million or $0.06 per share for the fourth quarter of fiscal 2011 and a net income of $1.4 million or $0.02 per share for the first quarter of fiscal 2011.
Non-GAAP income from continuing operations for the first quarter of fiscal 2012 was $0.6 million or $0.01 per diluted share, compared to non-GAAP income from continuing operations of $2.7 million or $0.04 per diluted share in the fourth quarter of fiscal 2011 and non-GAAP net income from continuing operations of $8.3 million or $0.12 per diluted share for the first quarter of fiscal 2011.
“Although we achieved our revenue targets for the quarter we did experience unfavorable product mix primarily with anticipated “turns” revenue for the quarter. Despite the hit to our gross margins we continue to see a high level of interest in our products and technology and I remain convinced that the long term fundamental growth drivers of our business remain intact.” said Dr. Paramesh Gopi, President and Chief Executive Officer.
Bob Gargus, Chief Financial Officer commented, “The unexpected change in gross margin is disappointing and as a result we will take actions to rebalance our operating expenses while retaining focus on the delivery of our new high growth products.”
AppliedMicro reports its financial results in accordance with GAAP and also provides additional financial data that have not been prepared in accordance with GAAP. The non-GAAP results and other financial measures reported by the Company exclude certain items that are required by GAAP, such as restructuring charges, amortization of purchased intangibles, stock-based compensation charges, other-than-temporary impairment on investments, payroll taxes on certain stock option exercises and non-cash tax adjustments. Income taxes are adjusted to an estimated non-GAAP effective tax rate. These non-GAAP measures are not a substitute for GAAP measures and may not be consistent with the presentation used by other companies. The Company uses the non-GAAP financial measures to evaluate and manage its operations. The Company is providing this information to allow investors to perform additional financial analysis and because it is consistent with the financial models and estimates published by analysts who follow the Company. The attached schedule reconciles non-GAAP results and other financial measures reported by the Company with the most directly comparable GAAP financial measures.
AppliedMicro management will be holding a conference call today, July 28, 2011 at 2:00 p.m. Pacific Time/5:00 p.m. Eastern Time to discuss additional details regarding the Company’s performance for the first quarter of fiscal 2012 and to provide guidance for the second quarter of fiscal 2012. You may access the conference call via any of the following:
| Teleconference: | 866-314-4483 | |
| Conference ID: | 92521966 | |
| Web Broadcast: | http://www.apm.com | |
| Replay: | 888-286-8010 (access code: 99958441, available through August 4, 2011) |
AppliedMicro Overview
AppliedMicro is a global leader in energy conscious high performance computing and connectivity solutions for telco, enterprise, data center, consumer and SMB applications. AppliedMicro’s corporate headquarters are located in Sunnyvale, California. Sales and engineering offices are located throughout the world. For further information regarding AppliedMicro, visit the company’s Web site at http://www.apm.com.
This news release contains forward-looking statements that reflect the Company’s current view with respect to future events and financial performance, including statements regarding the Company’s focus, product cycles, design-win pipeline, strategic re-focus and future revenues. These forward-looking statements are only predictions based on current information and expectations and are subject to certain risks and uncertainties, including, but not limited to, customer demand for the Company’s products, increased supplier lead times and other supply chain constraints, the businesses of the Company’s major customers, reductions, rescheduling or cancellation of orders by the Company’s customers, successful and timely development of products, successful integration and management of recently acquired businesses, market acceptance of new products, and general economic conditions. More information about potential factors that could affect the Company’s business and financial results is included in the “Risk Factors” set forth in the Company’s Annual Report on Form 10-K for the year ended March 31, 2011, and the Company’s other filings with the Securities and Exchange Commission. Actual results could differ materially, as a result of such factors, from those set forth in the forward-looking statements. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release. All forward-looking statements are qualified in their entirety by this cautionary statement, and the Company undertakes no obligation to revise or update any forward-looking statements to reflect events or circumstances after the issuance of this press release.
-Financial Tables Follow-
APPLIED MICRO CIRCUITS CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
(unaudited)
| June 30, 2011 |
March 31, 2011 |
|||||||
| ASSETS |
||||||||
| Current assets: |
||||||||
| Cash, cash equivalents and short-term investments |
$ | 141,850 | $ | 168,051 | ||||
| Accounts receivable, net |
24,157 | 19,997 | ||||||
| Inventories |
26,746 | 26,561 | ||||||
| Other current assets |
20,534 | 16,784 | ||||||
| Total current assets |
213,287 | 231,393 | ||||||
| Property and equipment, net |
33,803 | 32,023 | ||||||
| Goodwill |
13,183 | 13,183 | ||||||
| Purchased intangibles, net |
20,774 | 23,388 | ||||||
| Other assets |
11,775 | 8,670 | ||||||
| Total assets |
$ | 292,822 | $ | 308,657 | ||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY |
||||||||
| Current liabilities: |
||||||||
| Accounts payable |
$ | 24,232 | $ | 24,431 | ||||
| Other current liabilities |
24,208 | 22,416 | ||||||
| Total current liabilities |
48,440 | 46,847 | ||||||
| Stockholders’ equity |
244,382 | 261,810 | ||||||
| Total liabilities and stockholders’ equity |
$ | 292,822 | $ | 308,657 | ||||
APPLIED MICRO CIRCUITS CORPORATION
GAAP CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
(unaudited)
| Three Months Ended | ||||||||||||
| June 30, 2011 |
March 31, 2011 |
June 30, 2010 |
||||||||||
| Net revenues |
$ | 60,844 | $ | 58,583 | $ | 60,810 | ||||||
| Cost of revenues |
26,331 | 25,476 | 22,485 | |||||||||
| Gross profit |
34,513 | 33,107 | 38,325 | |||||||||
| Operating expenses: |
||||||||||||
| Research and development |
28,368 | 26,932 | 25,777 | |||||||||
| Selling, general and administrative |
12,556 | 11,733 | 11,624 | |||||||||
| Amortization of purchased intangibles |
1,099 | 1,713 | 1,005 | |||||||||
| Restructuring charges (recoveries), net |
913 | (34 | ) | 369 | ||||||||
| Total operating expenses |
42,936 | 40,344 | 38,775 | |||||||||
| Operating loss |
(8,423 | ) | (7,237 | ) | (450 | ) | ||||||
| Interest and other income (expense), net |
1,356 | 3,179 | 2,081 | |||||||||
| (Loss) income before income taxes |
(7,067 | ) | (4,058 | ) | 1,631 | |||||||
| Income tax (benefit) expense |
(190 | ) | (47 | ) | 240 | |||||||
| Net (loss) income |
$ | (6,877 | ) | $ | (4,011 | ) | $ | 1,391 | ||||
| Basic net (loss) income per share |
$ | (0.11 | ) | $ | (0.06 | ) | $ | 0.02 | ||||
| Shares used in calculating basic (loss) income per share |
63,878 | 64,236 | 66,005 | |||||||||
| Diluted net (loss) income per share |
$ | (0.11 | ) | $ | (0.06 | ) | $ | 0.02 | ||||
| Shares used in calculating diluted (loss) income per share |
63,878 | 64,236 | 68,735 | |||||||||
APPLIED MICRO CIRCUITS CORPORATION
RECONCILIATION OF GAAP NET INCOME (LOSS) TO NON-GAAP NET INCOME (LOSS)
(in thousands, except per share data)
(unaudited)
| Three Months Ended | ||||||||||||
| June 30, 2011 |
March 31, 2011 |
June 30, 2010 |
||||||||||
| GAAP net (loss) income |
$ | (6,877 | ) | $ | (4,011 | ) | $ | 1,391 | ||||
| Adjustments: |
||||||||||||
| Stock-based compensation charges |
4,178 | 3,774 | 3,846 | |||||||||
| Amortization of purchased intangibles |
2,614 | 4,973 | 3,630 | |||||||||
| Restructuring charges (recoveries), net |
913 | (34 | ) | 369 | ||||||||
| Other-than-temporary investment impairment |
(12 | ) | (1,914 | ) | (908 | ) | ||||||
| Income tax adjustments |
(209 | ) | (129 | ) | (17 | ) | ||||||
| Total GAAP to Non-GAAP adjustments |
7,484 | 6,670 | 6,920 | |||||||||
| Non-GAAP net income |
$ | 607 | $ | 2,659 | $ | 8,311 | ||||||
| Diluted income per share |
$ | 0.01 | $ | 0.04 | $ | 0.12 | ||||||
| Shares used in calculating diluted income per share |
65,003 | 65,741 | 68,735 | |||||||||
| Net (loss) income per share: |
||||||||||||
| GAAP (loss) income per share |
$ | (0.11 | ) | $ | (0.06 | ) | $ | 0.02 | ||||
| GAAP to non-GAAP adjustments |
0.12 | 0.10 | 0.10 | |||||||||
| Non-GAAP net income per share |
$ | 0.01 | $ | 0.04 | $ | 0.12 | ||||||
| Reconciliation of shares used in calculating non-GAAP income per share: |
||||||||||||
| Shares used in calculating the basic (loss) income per share |
63,878 | 64,236 | 66,005 | |||||||||
| Adjustment for dilutive securities |
1,125 | 1,505 | 2,730 | |||||||||
| Non-GAAP shares used in calculating diluted income per share |
65,003 | 65,741 | 68,735 | |||||||||
APPLIED MICRO CIRCUITS CORPORATION
SCHEDULE OF SELECTED GAAP TO NON-GAAP ADJUSTMENTS
(in thousands)
(unaudited)
The following schedule reconciles selected line items from the GAAP basis statements of operations to the non-GAAP statements of operations:
| Three Months Ended | ||||||||||||
| June 30, 2011 |
March 31, 2011 |
June 30, 2010 |
||||||||||
| GROSS PROFIT: |
||||||||||||
| GAAP gross profit |
$ | 34,513 | $ | 33,107 | $ | 38,325 | ||||||
| Amortization of purchased intangibles |
1,515 | 3,260 | 2,625 | |||||||||
| Stock-based compensation expense |
111 | 154 | 153 | |||||||||
| Non-GAAP gross profit |
$ | 36,139 | $ | 36,521 | $ | 41,103 | ||||||
| OPERATING EXPENSES: |
||||||||||||
| GAAP operating expenses |
$ | 42,936 | $ | 40,344 | $ | 38,775 | ||||||
| Stock-based compensation expense |
(4,067 | ) | (3,620 | ) | (3,693 | ) | ||||||
| Amortization of purchased intangibles |
(1,099 | ) | (1,713 | ) | (1,005 | ) | ||||||
| Restructuring (charges) recoveries, net |
(913 | ) | 34 | (369 | ) | |||||||
| Non-GAAP operating expenses |
$ | 36,857 | $ | 35,045 | $ | 33,708 | ||||||
| INTEREST AND OTHER INCOME (EXPENSE), NET: |
||||||||||||
| GAAP interest and other income, net |
$ | 1,356 | $ | 3,179 | $ | 2,081 | ||||||
| Other-than-temporary investment impairment |
(12 | ) | (1,914 | ) | (908 | ) | ||||||
| Non-GAAP interest and other income, net |
$ | 1,344 | $ | 1,265 | $ | 1,173 | ||||||
| INCOME TAX (BENEFIT) EXPENSE: |
||||||||||||
| GAAP income tax (benefit) expense |
$ | (190 | ) | $ | (47 | ) | $ | 240 | ||||
| Income tax adjustments |
209 | 129 | 17 | |||||||||
| Non-GAAP income tax expense |
$ | 19 | $ | 82 | $ | 257 | ||||||
| RESEARCH AND DEVELOPMENT: |
||||||||||||
| GAAP research and development |
$ | 28,368 | $ | 26,932 | $ | 25,777 | ||||||
| Stock-based compensation expense |
(2,388 | ) | (2,288 | ) | (1,971 | ) | ||||||
| Non-GAAP research and development |
$ | 25,980 | $ | 24,644 | $ | 23,806 | ||||||
| SELLING, GENERAL AND ADMINISTRATIVE: |
||||||||||||
| GAAP selling, general and administrative |
$ | 12,556 | $ | 11,733 | $ | 11,624 | ||||||
| Stock-based compensation expense |
(1,679 | ) | (1,332 | ) | (1,722 | ) | ||||||
| Non-GAAP selling, general and administrative |
$ | 10,877 | $ | 10,401 | $ | 9,902 | ||||||
APPLIED MICRO CIRCUITS CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
(unaudited)
| Three Months Ended June 30, | ||||||||
| 2011 | 2010 | |||||||
| Operating activities: |
||||||||
| Net (loss) income |
$ | (6,877 | ) | $ | 1,391 | |||
| Adjustments to reconcile net (loss) income to net cash (used for) provided by operating activities: |
||||||||
| Depreciation |
1,822 | 1,885 | ||||||
| Amortization of purchased intangibles |
2,614 | 3,630 | ||||||
| Stock-based compensation expense: |
||||||||
| Stock options |
1,573 | 987 | ||||||
| Restricted stock units |
2,605 | 2,859 | ||||||
| Tax benefit from other comprehensive income |
(367 | ) | — | |||||
| Capitalization of prior years mask set costs |
— | (1,177 | ) | |||||
| Net loss (gain) on disposals of property |
10 | (8 | ) | |||||
| Changes in operating assets and liabilities, net of amounts acquired: |
||||||||
| Accounts receivable |
(4,160 | ) | 2,686 | |||||
| Inventories |
(185 | ) | (2,010 | ) | ||||
| Other assets |
(3,230 | ) | 225 | |||||
| Accounts payable |
624 | (1,183 | ) | |||||
| Accrued payroll and other accrued liabilities |
1,825 | 1,718 | ||||||
| Deferred revenue |
(448 | ) | 230 | |||||
| Net cash (used for) provided by operating activities |
(4,194 | ) | 11,233 | |||||
| Investing activities: |
||||||||
| Purchases of short-term investments |
(57,879 | ) | (76,014 | ) | ||||
| Proceeds from sales and maturities of short-term investments |
41,891 | 5,121 | ||||||
| Purchase of property and equipment |
(4,533 | ) | (1,527 | ) | ||||
| Proceeds from sale of property and equipment |
— | 20 | ||||||
| Purchase of strategic investment |
(2,500 | ) | — | |||||
| Proceeds from sale of strategic investment |
— | 4,991 | ||||||
| Funding of a note receivable |
(1,000 | ) | — | |||||
| Net cash used for investing activities |
(24,021 | ) | (67,409 | ) | ||||
| Financing activities: |
||||||||
| Proceeds from issuances of common stock |
587 | 1,531 | ||||||
| Funding of restricted stock units withheld for taxes |
(2,172 | ) | (2,132 | ) | ||||
| Repurchases of common stock |
(3,097 | ) | — | |||||
| Funding of structured stock repurchase agreements |
(10,000 | ) | (10,000 | ) | ||||
| Funds received from structured stock repurchase agreements |
— | 10,273 | ||||||
| Other |
(111 | ) | (10 | ) | ||||
| Net cash used for financing activities |
(14,793 | ) | (338 | ) | ||||
| Net decrease in cash and cash equivalents |
(43,008 | ) | (56,514 | ) | ||||
| Cash and cash equivalents at the beginning of the period |
84,402 | 122,526 | ||||||
| Cash and cash equivalents at the end of the period |
41,394 | 66,012 | ||||||