SUNNYVALE, Calif., Oct. 28, 2014 (GLOBE NEWSWIRE) -- Applied Micro Circuits Corporation (Nasdaq:AMCC) ("AppliedMicro") today reported its financial results for the second quarter of fiscal 2015, ended September 30, 2014.
- Consolidated net revenue of $40.9 million
- GAAP net loss of $11.7 million or $0.15 per share
- Non-GAAP net loss of $5.0 million or $0.06 per share
Commenting on AppliedMicro's second quarter operations, Dr. Paramesh Gopi, President and Chief Executive Officer, said, "Following a very robust June quarter, our Connectivity business was impacted by weak service provider order patterns. We view this difficult environment as transitory." Dr. Gopi continued, "We are very pleased with our ARM 64-bit processor success with strong sequential X-GeneTM revenue growth and our HeliXTM family product launch."
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 second quarter results and business and financial outlook today, October 28, 2014, at 2:00 p.m. Pacific Time / 5:00 p.m. Eastern Time.
| DIAL-IN: | (877) 415-3182 |
| (857) 244-7325 | |
| PASSCODE: | 76367505 |
| WEBCAST: | Investor Relations section of the Company's website at www.apm.com |
A replay of the call will be available starting around 6:00 p.m. Pacific Time / 9:00 p.m. Eastern Time and can be accessed by dialing 888-286-8010 or 617-801-6888 and using the access code 15365763. The replay will be available through November 4, 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, HeliX, Server on a Chip, Cloud Processor 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; the anticipated performance of the Company's base business including the expected duration of weakness in service provider order patterns; 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, successful and timely development of products, an evolving competitive landscape, rapid technological change, increased supplier lead times and other supply chain constraints, changes in the businesses and budgeting decisions of the Company's major customers, reductions, rescheduling or cancellation of orders by the Company's customers, successful management of key service providers and recently acquired businesses, market acceptance of new products, legal and regulatory developments, and general economic conditions, and do not take into account any restructuring or related activities that the Company may undertake. 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, 2014, its Quarterly Report on Form 10-Q for the quarter ended June 30, 2014, and its 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) | ||
| September 30, | March 31, | |
| ASSETS | 2014 | 2014 |
| Current assets: | ||
| Cash, cash equivalents and short-term investments | $ 89,518 | $ 106,583 |
| Accounts receivable, net | 17,881 | 25,178 |
| Inventories | 17,592 | 18,946 |
| Other current assets | 13,670 | 16,799 |
| Total current assets | 138,661 | 167,506 |
| Property and equipment, net | 20,783 | 20,746 |
| Goodwill | 11,425 | 11,425 |
| Purchased intangibles, net | -- | 105 |
| Other assets | 4,278 | 7,754 |
| Total assets | $ 175,147 | $ 207,536 |
| LIABILITIES AND STOCKHOLDERS' EQUITY | ||
| Current liabilities: | ||
| Accounts payable | $ 11,576 | $ 26,194 |
| Other current liabilities | 23,237 | 28,961 |
| Total current liabilities | 34,813 | 55,155 |
| Non-current liabilities: | ||
| Veloce accrued liability | 3,707 | 3,145 |
| Stockholders' equity | 136,627 | 149,236 |
| Total liabilities and stockholders' equity | $ 175,147 | $ 207,536 |
| APPLIED MICRO CIRCUITS CORPORATION | |||||
| GAAP CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | |||||
| (in thousands, except per share data) | |||||
| (unaudited) | |||||
| Three Months Ended | Six Months Ended | ||||
| September 30, | June 30, | September 30, | September 30, | September 30, | |
| 2014 | 2014 | 2013 | 2014 | 2013 | |
| Net revenues | $ 40,945 | $ 50,272 | $ 55,387 | $ 91,217 | $ 109,535 |
| Cost of revenues | 17,716 | 20,257 | 21,397 | 37,973 | 43,739 |
| Gross profit | 23,229 | 30,015 | 33,990 | 53,244 | 65,796 |
| Operating expenses: | |||||
| Research and development | 24,711 | 33,205 | 56,550 | 57,916 | 91,056 |
| Selling, general and administrative | 7,919 | 9,058 | 9,146 | 16,977 | 18,672 |
| Amortization of purchased intangible assets | 42 | 62 | 62 | 104 | 192 |
| Restructuring | (110) | 1,211 | 999 | 1,101 | 1,092 |
| Gain on sale of TPack | -- | -- | -- | -- | (19,699) |
| Total operating expenses | 32,562 | 43,536 | 66,757 | 76,098 | 91,313 |
| Operating loss | (9,333) | (13,521) | (32,767) | (22,854) | (25,517) |
| Interest and other (expense) income, net | (2,112) | 315 | 576 | (1,797) | 4,371 |
| Loss before income taxes | (11,445) | (13,206) | (32,191) | (24,651) | (21,146) |
| Income tax expense (benefit) | 272 | (141) | 192 | 131 | 380 |
| Net loss | $ (11,717) | $ (13,065) | $ (32,383) | $ (24,782) | $ (21,526) |
| Basic and diluted net loss per share: | $ (0.15) | $ (0.17) | $ (0.45) | $ (0.32) | $ (0.30) |
| Shares used in calculating basic and diluted net loss per share | 78,487 | 77,916 | 72,610 | 78,202 | 70,985 |
| APPLIED MICRO CIRCUITS CORPORATION | |||||
| RECONCILIATION OF GAAP NET (LOSS) INCOME TO NON-GAAP NET INCOME | |||||
| (in thousands, except per share data) | |||||
| (unaudited) | |||||
| Three Months Ended | Six Months Ended | ||||
| September 30, | June 30, | September 30, | September 30, | September 30, | |
| 2014 | 2014 | 2013 | 2014 | 2013 | |
| GAAP net loss | $ (11,717) | $ (13,065) | $ (32,383) | $ (24,782) | $ (21,526) |
| Adjustments: | |||||
| Stock-based compensation charges | 4,230 | 5,216 | 3,834 | 9,446 | 7,548 |
| Amortization of purchased intangible assets | 42 | 62 | 62 | 104 | 358 |
| Veloce acquisition consideration | -- | 7,140 | 30,484 | 7,140 | 39,739 |
| Restructuring | (110) | 1,211 | 999 | 1,101 | 1,092 |
| Impairment of a strategic investment | 2,500 | -- | -- | 2,500 | -- |
| Gain on sale of TPack | -- | -- | -- | -- | (19,699) |
| Reversals of impairment charges upon sales of marketable securities | (11) | (18) | (940) | (29) | (3,959) |
| Income tax | 22 | (391) | (46) | (369) | (108) |
| Total GAAP to non-GAAP adjustments | 6,673 | 13,220 | 34,393 | 19,893 | 24,971 |
| Non-GAAP net (loss) income | $ (5,044) | $ 155 | $ 2,010 | $ (4,889) | $ 3,445 |
| Diluted non-GAAP (loss) income per share | $ (0.06) | $ 0.00 | $ 0.03 | $ (0.06) | $ 0.05 |
| Shares used in calculating diluted non-GAAP (loss) income per share | 78,487 | 79,082 | 74,301 | 78,202 | 72,268 |
| Net (loss) income per share: | |||||
| GAAP loss per share | $ (0.15) | $ (0.17) | $ (0.45) | $ (0.32) | $ (0.30) |
| GAAP to non-GAAP adjustments | 0.09 | 0.17 | 0.47 | 0.26 | 0.35 |
| Non-GAAP net (loss) income per share | $ (0.06) | $ 0.00 | $ 0.03 | $ (0.06) | $ 0.05 |
| Reconciliation of shares used in calculating non-GAAP (loss) income per share: | |||||
| Shares used in calculating the basic loss per share | 78,487 | 77,916 | 72,610 | 78,202 | 70,985 |
| Adjustment for dilutive securities | -- | 1,166 | 1,691 | -- | 1,283 |
| Shares used in calculating diluted non-GAAP (loss) income per share | 78,487 | 79,082 | 74,301 | 78,202 | 72,268 |
| APPLIED MICRO CIRCUITS CORPORATION | |||||
| SCHEDULE OF SELECTED GAAP TO NON-GAAP ADJUSTMENTS | |||||
| (in thousands) | |||||
| (unaudited) | |||||
| The following schedule reconciles selected line items on the condensed consolidated statements of operations from the GAAP basis to the non-GAAP basis: | |||||
| Three Months Ended | Six Months Ended | ||||
| September 30, | June 30, | September 30, | September 30, | September 30, | |
| 2014 | 2014 | 2013 | 2014 | 2013 | |
| GROSS PROFIT: | |||||
| GAAP gross profit | $ 23,229 | $ 30,015 | $ 33,990 | $ 53,244 | $ 65,796 |
| Amortization of purchased intangible assets | -- | -- | -- | -- | 166 |
| Stock-based compensation expense | 102 | 47 | 125 | 149 | 223 |
| Non-GAAP gross profit | $ 23,331 | $ 30,062 | $ 34,115 | $ 53,393 | $ 66,185 |
| OPERATING EXPENSES: | |||||
| GAAP operating expenses | $ 32,562 | $ 43,536 | $ 66,757 | $ 76,098 | $ 91,313 |
| Stock-based compensation expense | (4,128) | (5,169) | (3,709) | (9,297) | (7,325) |
| Amortization of purchased intangible assets | (42) | (62) | (62) | (104) | (192) |
| Veloce acquisition consideration | -- | (7,140) | (30,484) | (7,140) | (39,739) |
| Gain on sale of building | -- | -- | -- | -- | 19,699 |
| Restructuring | 110 | (1,211) | (999) | (1,101) | (1,092) |
| Non-GAAP operating expenses | $ 28,502 | $ 29,954 | $ 31,503 | $ 58,456 | $ 62,664 |
| INTEREST AND OTHER (EXPENSE) INCOME, NET | |||||
| GAAP interest and other (expense) income, net | $ (2,112) | $ 315 | $ 576 | $ (1,797) | $ 4,371 |
| Impairment of a strategic investment | 2,500 | -- | -- | 2,500 | -- |
| Reversals of impairment charges upon sales of marketable securities | (11) | (18) | (940) | (29) | (3,959) |
| Non-GAAP interest and other (expense) income, net | $ 377 | $ 297 | $ (364) | $ 674 | $ 412 |
| INCOME TAX EXPENSE (BENEFIT): | |||||
| GAAP income tax expense (benefit) | $ 272 | $ (141) | $ 192 | $ 131 | $ 380 |
| Income tax adjustment | (22) | 391 | 46 | 369 | 108 |
| Non-GAAP income tax expense | $ 250 | $ 250 | $ 238 | $ 500 | $ 488 |
| RESEARCH AND DEVELOPMENT: | |||||
| GAAP research and development | $ 24,711 | $ 33,205 | $ 56,550 | $ 57,916 | $ 91,056 |
| Stock-based compensation expense | (2,776) | (3,271) | (1,524) | (6,047) | (3,341) |
| Veloce acquisition consideration | -- | (7,140) | (30,484) | (7,140) | (39,739) |
| Non-GAAP research and development | $ 21,935 | $ 22,794 | $ 24,542 | $ 44,729 | $ 47,976 |
| SELLING, GENERAL AND ADMINISTRATIVE: | |||||
| GAAP selling, general and administrative | $ 7,919 | $ 9,058 | $ 9,146 | $ 16,977 | $ 18,672 |
| Stock-based compensation expense | (1,352) | (1,898) | (2,185) | (3,250) | (3,984) |
| Non-GAAP selling, general and administrative | $ 6,567 | $ 7,160 | $ 6,961 | $ 13,727 | $ 14,688 |
| APPLIED MICRO CIRCUITS CORPORATION | |||||
| CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||
| (in thousands) | |||||
| (unaudited) | |||||
| Three Months Ended | Six Months Ended | ||||
| September 30, | June 30, | September 30, | September 30, | September 30, | |
| 2014 | 2014 | 2013 | 2014 | 2013 | |
| Operating activities: | |||||
| Net loss | $ (11,717) | $ (13,065) | $ (32,384) | $ (24,782) | $ (21,526) |
| Adjustments to reconcile net loss to net cash used for operating activities: | |||||
| Depreciation | 2,227 | 2,174 | 2,659 | 4,401 | 5,283 |
| Amortization of purchased intangible assets | 42 | 62 | 62 | 104 | 358 |
| Stock-based compensation expense | 4,230 | 5,216 | 3,834 | 9,446 | 7,548 |
| Veloce acquisition consideration | -- | 7,140 | 30,484 | 7,140 | 39,739 |
| Tax effect on other comprehensive loss | 110 | (194) | -- | (84) | -- |
| Noncash restructuring charges | -- | -- | 272 | -- | 298 |
| Gain on sale of TPack | -- | -- | -- | -- | (19,699) |
| Loss on disposals of property and equipment | 6 | 16 | 30 | 22 | 27 |
| Impairment of a strategic investment | 2,500 | -- | -- | 2,500 | -- |
| Changes in operating assets and liabilities: | |||||
| Accounts receivable | 5,051 | 2,246 | 2,108 | 7,297 | (2,366) |
| Inventories | 3,079 | (1,745) | (80) | 1,334 | 105 |
| Other assets | (1,241) | 1,994 | (1,757) | 753 | (159) |
| Accounts payable | (5,741) | (6,163) | (1,257) | (11,904) | (1,943) |
| Accrued payroll and other accrued liabilities | (4,252) | 1,663 | (2,339) | (2,589) | 1,810 |
| Veloce accrued liability | (1,116) | (6,383) | (19,258) | (7,499) | (44,240) |
| Deferred revenue | (668) | 502 | 79 | (166) | (594) |
| Net cash used for operating activities | (7,490) | (6,537) | (17,547) | (14,027) | (35,359) |
| Investing activities: | |||||
| Proceeds from sales and maturities of short-term investments | 1,238 | 682 | 7,118 | 1,920 | 21,303 |
| Purchases of short-term investments | (749) | (1,320) | (5,816) | (2,069) | (8,177) |
| Proceeds from sale of TPack, net | -- | 3,353 | -- | 3,353 | 29,498 |
| Proceeds from sale of property and equipment | 1 | -- | 20 | 1 | 20 |
| Purchase of property and equipment | (2,756) | (4,544) | (1,744) | (7,300) | (2,023) |
| Proceeds from sale of strategic equity investment | -- | -- | 1,286 | -- | 1,286 |
| Net cash (used for) provided by investing activities | (2,266) | (1,829) | 864 | (4,095) | 41,907 |
| Financing activities: | |||||
| Proceeds from issuances of common stock | 1,757 | 106 | 6,765 | 1,863 | 6,936 |
| Funding of restricted stock units withheld for taxes | (322) | (924) | (1,697) | (1,246) | (4,079) |
| Other | -- | (88) | (150) | (88) | (562) |
| Net cash provided by (used for) financing activities | 1,435 | (906) | 4,918 | 529 | 2,295 |
| Net (decrease) increase in cash and cash equivalents | (8,321) | (9,272) | (11,765) | (17,593) | 8,843 |
| Cash and cash equivalents at the beginning of the period | 62,267 | 71,539 | 39,673 | 71,539 | 19,065 |
| Cash and cash equivalents at the end of the period | $ 53,946 | $ 62,267 | $ 27,908 | $ 53,946 | $ 27,908 |