SUNNYVALE, Calif., April 24, 2014 (GLOBE NEWSWIRE) -- Applied Micro Circuits Corporation (Nasdaq:AMCC) ("AppliedMicro") today reported its financial results for the fiscal fourth quarter and full year ended March 31, 2014.
Fiscal Q4 2014 Financial Information
- Consolidated net revenue of $51.8 million
- GAAP net income of $23.1 million or $0.30 per diluted share
- Non-GAAP net income of $0.7 million or $0.01 earnings per diluted share
- Total cash, cash equivalents and short-term investments were approximately $106.6 million as of March 31, 2014
Fiscal 2014 Full-Year Financial Information
- Consolidated net revenue of $216.2 million
- GAAP net loss of $5.7 million or $0.08 per share
- Non-GAAP net income of $5.8 million or $0.08 earnings per diluted share
Commenting on AppliedMicro's fourth quarter and fiscal 2014 full year operations, Dr. Paramesh Gopi, President and Chief Executive Officer, said, "We are very excited with the progress we have made to commercialize X-Gene™. Design win momentum is strong, and we have purchase orders in-hand. We expect to begin sampling X-Gene 2 later this spring." Dr. Gopi continued, "In addition, our leadership in the OTN / converged Ethernet market has positioned us very well to benefit from the adoption of 100Gbps connectivity within and between data centers."
Doug Ahrens, Chief Financial Officer, said, "The base business performed better than our expectations on the bottom line and continues to support the ongoing development of our X-Gene and X-Weave™ growth initiatives. We are also very pleased to have further strengthened our balance sheet in the quarter."
Fiscal 2014 Fourth Quarter Results
Total net revenue for the fiscal 2014 fourth quarter was $51.8 million compared to $54.8 million in the third quarter of fiscal 2014 and $56.3 million in the fourth quarter of fiscal 2013, representing a decrease of 6% sequentially and a decrease of 8% year-over-year.
Net income on a generally accepted accounting principles (GAAP) basis for the fiscal 2014 fourth quarter was $23.1 million, or $0.30 per diluted share. This compares to a GAAP net loss of $7.3 million, or $0.10 per share, in the prior quarter and a GAAP net loss of $17.6 million, or $0.26 per share, in the fourth quarter of fiscal 2013.
Non-GAAP net income for the fiscal 2014 fourth quarter was $0.7 million, or $0.01 per diluted share, compared to non-GAAP net income of $1.6 million, or $0.02 per diluted share, in the prior quarter and non-GAAP net income of $0.1 million, or $0.00 per diluted share, in the same quarter last year.
AppliedMicro provides non-GAAP results as additional information relating to its financial condition and business trends. This information should be considered in conjunction with corresponding GAAP measures. A reconciliation between GAAP and non-GAAP financial results is provided in the financial tables section of this press release.
Conference Call and Webcast
Management will host a conference call and simultaneous webcast to discuss fourth quarter results and business and financial outlook today, April 24, 2014, at 2:00 p.m. Pacific Time / 5:00 p.m. Eastern Time.
| DIAL-IN: | (877) 415-3183 |
| (857) 244-7326 | |
| PASSCODE: | 42709447 |
| WEBCAST: | Investor Relations section of the Company's website at www.apm.com |
A replay of the call will be available starting approximately one hour after the completion of the call and can be accessed by dialing 888-286-8010 or 617-801-6888 and using the access code 40927216. The replay will be available through May 1, 2014.
About AppliedMicro
Applied Micro Circuits Corporation is a global leader in computing and connectivity solutions for next-generation cloud infrastructure and data centers. AppliedMicro delivers silicon solutions that dramatically lower total cost of ownership. Corporate headquarters are located in Sunnyvale, California. www.apm.com.
(C) Copyright 2014, Applied Micro Circuits Corporation. AppliedMicro, X-Gene, X-Weave, Server on a Chip, and Cloud Server are trademarks or registered trademarks of Applied Micro Circuits Corporation. All other product or service names are the property of their respective owners.
Forward-Looking Statements
This press release contains forward-looking statements that reflect the Company's current views and expectations with respect to future events and financial performance, including statements regarding the Company's strategic focus; product cycles; new product development, commercialization and customer acceptance; the development of the X-Gene™ ecosystem; market and technological trends including the adoption of ARM-based products and the anticipated migration to 100G within and between data centers; the anticipated performance of the Company's base business; and future revenues, expenses and liquidity. 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, and in particular, new products such as X-Gene and X-Weave; potential problems or delays in product development and validation; competitors' product introductions, pricing decisions and other competitive factors; rapid technological change; increased supplier lead times and other supply chain constraints; the potential for manufacturing yield problems and product bugs or defects; changes in the businesses and financial condition of the Company's major customers and ecosystem partners, including their strategic and budgeting decisions; reductions, rescheduling or cancellation of customer orders; successful management of key service providers and recently acquired businesses; the possibility of unexpected expenses; potential changes in capital needs and liquidity; legal and regulatory developments; 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 Quarterly Report on Form 10-Q for the quarter ended December 31, 2013, 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.
| APPLIED MICRO CIRCUITS CORPORATION | ||
| CONDENSED CONSOLIDATED BALANCE SHEETS | ||
| (in thousands) | ||
| (unaudited) | ||
| March 31, | March 31, | |
| ASSETS | 2014 | 2013 |
| Current assets: | ||
| Cash, cash equivalents and short-term investments | $106,583 | $85,476 |
| Accounts receivable, net | 25,178 | 24,575 |
| Inventories | 18,946 | 12,900 |
| Other current assets | 16,799 | 17,998 |
| Total current assets | 167,506 | 140,949 |
| Property and equipment, net | 20,746 | 34,391 |
| Goodwill | 11,425 | 13,183 |
| Purchased intangibles, net | 105 | 11,991 |
| Other assets | 7,754 | 10,866 |
| Total assets | $207,536 | $211,380 |
| LIABILITIES AND STOCKHOLDERS' EQUITY | ||
| Current liabilities: | ||
| Accounts payable | $26,194 | $17,650 |
| Other current liabilities | 28,961 | 96,439 |
| Total current liabilities | 55,155 | 114,089 |
| Non-current liabilities: | ||
| Other long-term liabilities | 3,145 | 15,787 |
| Stockholders' equity | 149,236 | 81,504 |
| Total liabilities and stockholders' equity | $207,536 | $211,380 |
| APPLIED MICRO CIRCUITS CORPORATION | |||||
| GAAP CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | |||||
| (in thousands, except per share data) | |||||
| (unaudited) | |||||
| Three Months Ended | Year Ended | ||||
| March 31, | December 31, | March 31, | March 31, | March 31, | |
| 2014 | 2013 | 2013 | 2014 | 2013 | |
| Net revenues | $51,771 | $54,844 | $56,326 | $216,150 | $195,642 |
| Cost of revenues | 19,806 | 21,644 | 21,174 | 85,189 | 83,048 |
| Gross profit | 31,965 | 33,200 | 35,152 | 130,961 | 112,594 |
| Operating expenses: | |||||
| Research and development | 25,653 | 29,870 | 35,554 | 146,579 | 187,419 |
| Selling, general and administrative | 9,325 | 10,930 | 13,008 | 38,927 | 51,684 |
| Amortization of purchased intangible assets | 62 | 62 | 337 | 316 | 1,926 |
| Restructuring charges, net | 4 | 38 | 217 | 1,134 | 6,435 |
| Gain on sale of building | (25,815) | -- | -- | (25,815) | -- |
| Gain on sale of TPack | -- | -- | -- | (19,699) | -- |
| Total operating expenses | 9,229 | 40,900 | 49,116 | 141,442 | 247,464 |
| Operating income (loss) | 22,736 | (7,700) | (13,964) | (10,481) | (134,870) |
| Interest and other income (expense), net | 418 | 617 | (4,654) | 5,406 | 201 |
| Income (loss) before income taxes | 23,154 | (7,083) | (18,618) | (5,075) | (134,669) |
| Income tax expense (benefit) | 38 | 201 | (1,012) | 619 | (554) |
| Net income (loss) | $23,116 | $(7,284) | $(17,606) | $(5,694) | $(134,115) |
| Basic net income (loss) per share: | $0.31 | $(0.10) | $(0.26) | $(0.08) | $(2.06) |
| Shares used in calculating basic net income (loss) per share | 75,629 | 73,989 | 67,566 | 72,897 | 65,258 |
| Diluted net income (loss) per share: | $0.30 | $(0.10) | $(0.26) | $(0.08) | $(2.06) |
| Shares used in calculating diluted net income (loss) per share | 77,193 | 73,989 | 67,566 | 72,897 | 65,258 |
| APPLIED MICRO CIRCUITS CORPORATION | |||||
| RECONCILIATION OF GAAP NET LOSS TO NON-GAAP NET INCOME (LOSS) | |||||
| (in thousands, except per share data) | |||||
| (unaudited) | |||||
| Three Months Ended | Year Ended | ||||
| March 31, | December 31, | March 31, | March 31, | March 31, | |
| 2014 | 2013 | 2013 | 2014 | 2013 | |
| GAAP net income (loss) | $23,116 | $(7,284) | $(17,606) | $(5,694) | $(134,115) |
| Adjustments: | |||||
| Stock-based compensation charges | 3,591 | 5,882 | 2,691 | 17,021 | 24,236 |
| Warrant expense | -- | -- | -- | -- | 1,289 |
| Amortization of purchased intangibles | 62 | 62 | 1,017 | 482 | 4,643 |
| Veloce acquisition consideration | -- | 2,945 | 9,608 | 42,684 | 66,188 |
| Acquisition related recoveries | -- | -- | -- | -- | (133) |
| Restructuring charges, net | 4 | 38 | 217 | 1,134 | 6,435 |
| Impairment of strategic investment | -- | -- | 2,250 | -- | 2,250 |
| Gain on sale of building | (25,815) | -- | -- | (25,815) | -- |
| Sale of equipment and other assets | -- | -- | -- | -- | (1,299) |
| Impairment of notes receivable and other assets | -- | -- | 1,800 | -- | 1,800 |
| Gain on sale of TPack | -- | -- | -- | (19,699) | -- |
| Impairment of marketable securities | (16) | (17) | 1,121 | (3,992) | (412) |
| Income tax adjustments | (212) | (48) | (1,015) | (368) | 336 |
| Total GAAP to Non-GAAP adjustments | (22,386) | 8,862 | 17,689 | 11,447 | 105,333 |
| Non-GAAP net income (loss) | $730 | $1,578 | $83 | $5,753 | $(28,782) |
| Diluted income (loss) per share | $0.01 | $0.02 | $0.00 | $0.08 | $(0.44) |
| Shares used in calculating diluted income (loss) per share | 77,193 | 75,754 | 68,522 | 74,371 | 65,258 |
| Net income (loss) per share: | |||||
| GAAP income (loss) per share | $0.30 | $(0.10) | $(0.26) | $(0.08) | $(2.06) |
| GAAP to non-GAAP adjustments | (0.29) | 0.12 | 0.26 | 0.16 | 1.62 |
| Non-GAAP net income (loss) per share | $0.01 | $0.02 | $0.00 | $0.08 | $(0.44) |
| Reconciliation of shares used in calculating non-GAAP income (loss) per share: | |||||
| Shares used in calculating the basic income (loss) per share | 75,629 | 73,989 | 67,566 | 72,897 | 65,258 |
| Adjustment for dilutive securities | 1,564 | 1,765 | 956 | 1,474 | -- |
| Non-GAAP shares used in calculating diluted income (loss) per share | 77,193 | 75,754 | 68,522 | 74,371 | 65,258 |
| 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 | Year Ended | ||||
| March 31, | December 31, | March 31, | March 31, | March 31, | |
| 2014 | 2013 | 2013 | 2014 | 2013 | |
| GROSS PROFIT: | |||||
| GAAP gross profit | $31,965 | $33,200 | $35,152 | $130,961 | $112,594 |
| Amortization of purchased intangibles | -- | -- | 680 | 166 | 2,717 |
| Stock-based compensation expense | 102 | 120 | 95 | 445 | 692 |
| Non-GAAP gross profit | $32,067 | $33,320 | $35,927 | $131,572 | $116,003 |
| OPERATING EXPENSES: | |||||
| GAAP operating expenses | $9,229 | $40,900 | $49,116 | $141,442 | $247,464 |
| Stock-based compensation expense | (3,489) | (5,762) | (2,596) | (16,576) | (23,544) |
| Warrant expense | -- | -- | -- | -- | (1,289) |
| Amortization of purchased intangibles | (62) | (62) | (337) | (316) | (1,926) |
| Acquisition related expenses | -- | -- | -- | -- | 133 |
| Veloce acquisition consideration | -- | (2,945) | (9,608) | (42,684) | (66,188) |
| Gain on sale of building | 25,815 | -- | -- | 25,815 | -- |
| Gain on sale of TPack | -- | -- | -- | 19,699 | -- |
| Restructuring charges, net | (4) | (38) | (217) | (1,134) | (6,435) |
| Non-GAAP operating expenses | $31,489 | $32,093 | $36,358 | $126,246 | $148,215 |
| INTEREST AND OTHER INCOME (EXPENSE), NET | |||||
| AND OTHER-THAN-TEMPORARY IMPAIRMENT: | |||||
| GAAP interest and other income (expense), net | $418 | $617 | $(4,654) | $5,406 | $201 |
| Impairment of strategic investment | -- | -- | 2,250 | -- | 2,250 |
| Sale of equipment and other assets | -- | -- | -- | -- | (1,299) |
| Impairment of notes receivable and other assets | -- | -- | 1,800 | -- | 1,800 |
| Other-than-temporary investment impairment | (16) | (17) | 1,121 | (3,992) | (412) |
| Non-GAAP interest and other income (expense), net | $402 | $600 | $517 | $1,414 | $2,540 |
| INCOME TAX EXPENSE (BENEFIT): | |||||
| GAAP income tax expense (benefit) | $38 | $201 | $(1,012) | $619 | $(554) |
| Income tax adjustments | 212 | 48 | 1,015 | 368 | (336) |
| Non-GAAP income tax expense (benefit) | $250 | $249 | $3 | $987 | $(890) |
| RESEARCH AND DEVELOPMENT : | |||||
| GAAP research and development | $25,653 | $29,870 | $35,554 | $146,579 | $187,419 |
| Stock-based compensation expense | (1,503) | (1,546) | (1,026) | (6,390) | (11,760) |
| Warrant expense | -- | -- | -- | -- | (1,289) |
| Veloce acquisition consideration | -- | (2,945) | (9,608) | (42,684) | (66,188) |
| Non-GAAP research and development | $24,150 | $25,379 | $24,920 | $97,505 | $108,182 |
| SELLING, GENERAL AND ADMINISTRATIVE : | |||||
| GAAP selling, general and administrative | $9,325 | $10,930 | $13,008 | $38,927 | $51,684 |
| Stock-based compensation expense | (1,986) | (4,216) | (1,570) | (10,186) | (11,784) |
| Acquisition related expenses | -- | -- | -- | -- | 133 |
| Non-GAAP selling, general and administrative | $7,339 | $6,714 | $11,438 | $28,741 | $40,033 |
| APPLIED MICRO CIRCUITS CORPORATION | ||
| CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | ||
| (in thousands) | ||
| (unaudited) | ||
| Year Ended March 31, | ||
| 2014 | 2013 | |
| Operating activities: | ||
| Net loss | $ (5,694) | $ (134,115) |
| Adjustments to reconcile net loss to net cash used for operating activities: | ||
| Depreciation | 10,273 | 9,542 |
| Amortization of purchased intangibles | 482 | 4,643 |
| Stock-based compensation expense: | ||
| Stock options | 2,519 | 3,469 |
| Restricted stock units | 14,502 | 20,767 |
| Warrants | -- | 1,289 |
| Veloce accrued liability | 42,684 | 66,188 |
| Tax effect on other comprehensive income | (40) | (989) |
| Noncash restructuring charges | 298 | 4,719 |
| Acquisition related adjustment | -- | (133) |
| Net gain on sale of TPack | (19,699) | -- |
| Net gain on sale of building | (25,815) | -- |
| Net gain on disposals of property, equipment and other assets | (23) | (1,293) |
| Impairment loss on strategic investments, net | -- | 2,250 |
| Impairment of short-term investments and marketable securities | -- | 1,143 |
| Write-off of notes receivable and other assets | -- | 1,800 |
| Changes in operating assets and liabilities: | ||
| Accounts receivable | (837) | (1,909) |
| Inventories | (6,049) | 10,344 |
| Other assets | 3,232 | (2,871) |
| Accounts payable | 5,778 | (622) |
| Accrued payroll and other accrued liabilities | (671) | (82) |
| Veloce accrued liability | (63,657) | (16,537) |
| Deferred revenue | (770) | (668) |
| Net cash used for operating activities | (43,487) | (33,065) |
| Investing activities: | ||
| Proceeds from sales and maturities of short-term investments | 44,450 | 42,164 |
| Purchases of short-term investments | (18,081) | (21,633) |
| Proceeds from sale of TPack | 29,498 | -- |
| Proceeds from sale of property, equipment and other assets | 70 | 1,800 |
| Proceeds from sale of building | 40,176 | -- |
| Purchase of property, equipment and other assets | (5,952) | (9,045) |
| Proceeds from sale of strategic equity investment | 1,286 | 7,146 |
| Purchase of strategic equity investment | -- | (500) |
| Net cash provided by investing activities | 91,447 | 19,932 |
| Financing activities: | ||
| Proceeds from issuances of common stock | 11,619 | 8,873 |
| Funding of restricted stock units withheld for taxes | (6,550) | (3,121) |
| Repurchase of common stock | -- | (653) |
| Payment of contingent consideration | -- | (485) |
| Other | (555) | (481) |
| Net cash provided by financing activities | 4,514 | 4,133 |
| Net increase (decrease) in cash and cash equivalents | 52,474 | (9,000) |
| Cash and cash equivalents at the beginning of the period | 19,065 | 28,065 |
| Cash and cash equivalents at the end of the period | $ 71,539 | $ 19,065 |