SUNNYVALE, Calif., April 30, 2009 (GLOBE NEWSWIRE) -- Applied Micro Circuits Corporation (Nasdaq:AMCC) today reported its financial results for the fourth quarter of fiscal 2009 ending March 31st, 2009.
* Q4 net revenues from continuing operations were $41.0 million, down 30% year over year and 14% sequentially. Q4 revenues from the discontinued storage business were $4.5 million and down 65% year over year and 54% sequentially. * Q4 and fiscal 2009 GAAP net loss was $(27.4) million and $(309.3) million or $(0.42) and $(4.74) per share, respectively. Q4 and fiscal 2009 loss from discontinued operations were $(4.6) million and $(48.2) million or $(0.07) and $(0.74) per share, respectively. * Q4 2009 non-GAAP net loss was $(11.8) million or $(0.18) per share and fiscal 2009 non-GAAP net income of $10.2 million or $0.16 per share. * Total cash was approximately $184 million as of March 31, 2009 (before the cash from the sale of the storage business). * On April 21, 2009 AMCC completed the sale of its 3ware storage adapter solutions business for $20 million in cash. * In Q4 2009, AMCC announced a reduction in force impacting slightly over 100 people that will result in anticipated annual savings of $14 to $16 million (this does not include the divestiture of the storage business). * AMCC announced the introduction of the Yahara family of 10GbE Framer/Mapper/PHY devices for multi-service transport platforms and Metro/Long Haul Optical networks.
Net revenues from continuing operations for the fourth quarter of fiscal 2009 were $41.0 million compared to $47.7 million in the third quarter of fiscal 2009, representing a sequential decline of 14% and a decline of 30% over the $58.6 million in net revenues reported in the fourth quarter of fiscal 2008. Revenues from continuing operations for the fiscal year ended March 31, 2009 were $214.2 million compared to $194.1 million for last year, a 10% increase.
The net loss on a generally accepted accounting principles (GAAP) basis for the fourth quarter of fiscal 2009 was $(27.4) million or $(0.42) per share. The fourth quarter GAAP net loss compares with a net loss of $(274.5) million or $(4.20) per share for the third quarter of fiscal 2009 and a net loss of $(86.3) million or $(1.33) per share for the fourth quarter of fiscal 2008. The GAAP net loss for fiscal 2009 was $(309.3) million or $(4.74) per share compared to $(115.1) million or $(1.70) per share for fiscal 2008. The losses for fiscal 2009 and 2008 included $264.1 million and $71.5 million, respectively, relating to the impairment write-down of goodwill.
Non-GAAP loss from continuing operations for the fourth quarter of fiscal 2009 was $(8.4) million or $(0.13) per share, compared to non-GAAP income from continuing operations of $3.3 million or $0.05 per share in the third quarter of fiscal 2009 and non-GAAP net income from continuing operations of $5.3 million or $0.08 per share for the fourth quarter of fiscal 2008. The non-GAAP net income from continuing operations for fiscal 2009 was $11.6 million or $0.18 per share compared to a non-GAAP loss from continuing operations of $(7.1) million or $(0.10) per share for fiscal 2008.
"The lower revenues were in line with our expectations given the overall depressed market conditions. The sale of our 3ware storage adapter business enables us to focus on our core strengths in the development of integrated circuits for energy-optimized packet-based networks. Given our solid product cycles and design-win pipeline combined with our strategic refocus, I am confident we will emerge from this downturn as a much stronger company," said Kambiz Hooshmand, president and chief executive officer.
Bob Gargus, chief financial officer, commented, "The fourth quarter was difficult, but with the divestiture and certain cost control measures that we have put in place, we are confident that it will enable us to optimally focus our resources on our core business sectors and give us a solid base to scale as revenues ramp back."
AMCC 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, impairment of goodwill, strategic investment written off and gain on renegotiated design tool agreement, other than temporary impairment on investments, tax provision related to the creation of deferred tax liability relating to a prior asset purchase acquisition transaction, realized gain on sale of strategic equity investment, payroll tax on certain stock option exercises and expenses related to stock option investigation and other litigation. Expenses related to stock option investigation consist primarily of fees paid to professional service firms in connection with the Company's internal investigation of historical stock option grant practices and the resulting restatement of the Company's financial statements, the investigations by the Securities and Exchange Commission and the U.S. Attorney's office arising from the internal investigation and the defense of derivative lawsuits arising from the Company's internal investigation and other litigation relates to an accrual made for a potential litigation settlement. 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.
AMCC management will be holding a conference call today, April 30, 2009, at 2:00 p.m. Pacific Time/5:00 p.m. Eastern Time to discuss additional details regarding the Company's performance for the fourth quarter of fiscal 2009 and to provide guidance for the first quarter of fiscal 2010. You may access the conference call via any of the following:
Teleconference: 719-325-4830 Conference ID: 1494407 Web Broadcast: http://investor.amcc.com/events.cfm Replay: 719-457-0820 (available through May 5, 2009)
AMCC Overview
AMCC is a global leader in energy efficient sustainable solutions to Process, Transport, and Store information for the next generation of internet data center and carrier central office. As a leader in high speed signal processing, IP & Ethernet packet processing, and storage processing, AMCC's patented innovations provide high value highly integrated Systems On a Chip (SoCs) for Telecom, Enterprise and Consumer Applications.
AMCC's corporate headquarters are located in Sunnyvale, California. Sales and engineering offices are located throughout the world. We maintain a web site to which we regularly post copies of our press releases, our filings with the Securities and Exchange Commission and additional information about us. Interested persons can also subscribe on our web site to email alerts or RSS feeds. Please visit www.amcc.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, 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, 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, 2008, 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 2009 2008 -------- -------- Current assets: Cash, cash equivalents and short-term investments $184,009 $142,889 Accounts receivable, net 17,537 28,800 Inventories 26,598 30,293 Other current assets 8,871 11,097 Assets of discontinued operations 8,558 8,678 -------- -------- Total current assets 245,573 221,757 Marketable securities -- 51,919 Property and equipment, net 25,749 25,233 Goodwill -- 264,130 Purchased intangibles 32,965 56,025 Other assets 20,323 13,783 -------- -------- Total assets $324,610 $632,847 ======== ======== LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable $ 16,715 $ 25,518 Other current liabilities 23,925 22,659 -------- -------- Total current liabilities 40,640 48,177 Deferred tax liability -- 3,958 Stockholders' equity 283,970 580,712 -------- -------- Total liabilities and stockholders' equity $324,610 $632,847 ======== ========
APPLIED MICRO CIRCUITS CORPORATION GAAP CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except per share data) (unaudited) Three Months Ended Year Ended ------------------------------ --------------------- March 31, Dec. 31, March 31, March 31, March 31, 2009 2008 2008 2009 2008 ------------------------------ --------------------- Net revenues $ 41,001 $ 47,726 $ 58,557 $ 214,216 $ 194,115 Cost of revenues 21,842 22,226 28,874 101,070 98,756 --------- ---------- --------- ---------- ---------- Gross profit 19,159 25,500 29,683 113,146 95,359 Operating expenses: Research and development 24,202 18,625 19,916 84,687 86,117 Selling, general and administra- tive 11,151 11,315 13,095 50,097 52,037 Amortization of purchased intangibles 1,005 1,005 1,005 4,020 4,061 Impairment of goodwill -- 222,972 -- 222,972 -- Restructuring charges, net 7,717 1,024 1,489 8,623 2,958 Litigation settlement -- -- 1,125 130 1,125 Option investigation related expenses, net (4) (79) 1,363 80 1,072 --------- ---------- --------- ---------- ---------- Total operating expenses 44,071 254,862 37,993 370,609 147,370 --------- ---------- --------- ---------- ---------- Operating loss (24,912) (229,362) (8,310) (257,463) (52,011) Interest and other (expense) income, net 1,693 (7,397) (1,551) (7,581) 10,579 --------- ---------- --------- ---------- ---------- Loss from continuing operations, before income taxes (23,219) (236,759) (9,861) (265,044) (41,432) Income tax expense (benefit) (455) (4,396) 4,135 (3,946) 3,773 --------- ---------- --------- ---------- ---------- Loss from continuing operations (22,764) (232,363) (13,996) (261,098) (45,205) Loss from discontinue operations, net of tax (a) (4,622) (42,097) (72,313) (48,235) (69,916) --------- ---------- --------- ---------- ---------- Net loss $(27,386) $(274,460) $(86,309) $(309,333) $(115,121) ========= ========== ========= ========== ========== Basic and diluted loss per share: Loss per share from continuing operations $ (0.35) $ (3.55) $ (0.22) $ (4.00) $ (0.67) Loss per share from discontinued operations (0.07) (0.65) (1.11) (0.74) (1.03) --------- ---------- --------- ---------- ---------- Net loss per share $ (0.42) $ (4.20) $ (1.33) $ (4.74) $ (1.70) ========= ========== ========= ========== ========== Shares used in calculating basic and diluted loss per share 65,703 65,366 64,886 65,271 67,775 ========= ========== ========= ========== ==========
(a) The following table provides information on the components of the loss from discontinued operations for the periods presented:
Components of discontinued operations Three Months Ended Year Ended ------------------------------ --------------------- March 31, Dec. 31, March 31, March 31, March 31, 2009 2008 2008 2009 2008 ------------------------------ --------------------- Net revenues $ 4,508 $ 9,839 $ 12,977 $ 39,849 $ 52,031 Cost of revenues 4,071 5,537 7,657 24,437 27,912 --------- ---------- --------- ---------- ---------- Gross profit 437 4,302 5,320 15,412 24,119 Operating expenses: Research and development 2,758 2,630 2,976 11,470 11,433 Selling, general and administrative 2,142 2,103 2,774 9,561 9,870 Amortization of purchased intangibles 315 315 315 1,260 1,260 Impairment of goodwill -- 41,158 71,494 41,158 71,494 Restructuring charges, net -- 126 27 126 27 --------- ---------- --------- ---------- ---------- Total operating expenses 5,215 46,332 77,586 63,575 94,084 --------- ---------- --------- ---------- ---------- Loss from discontinued operations, before income taxes (4,778) (42,030) (72,266) (48,163) (69,965) Income tax expense (benefit) (156) 67 47 72 (49) --------- ---------- --------- ---------- ---------- Loss from discontinued operations, net of tax $ (4,622) $ (42,097) $(72,313) $ (48,235) $ (69,916) ========= ========== ========= ========== ==========
APPLIED MICRO CIRCUITS CORPORATION RECONCILIATION OF GAAP NET LOSS TO NON-GAAP NET INCOME (LOSS) FOR CONTINUING AND DISCONTINUED OPERATIONS (in thousands, except per share data) (unaudited) Three Months Ended Year Ended ----------------------------- ------------------- March 31, Dec. 31, March 31, March 31, March 31, 2009 2008 2008 2009 2008 ----------------------------- ------------------- GAAP loss - from continuing operations $(22,764) $(232,363) $(13,996) $(261,098) $(45,205) Adjustments: Stock-based compensation charges 2,076 1,547 2,691 9,185 10,056 Amortization of purchased intangibles 4,588 4,588 4,863 18,900 19,601 Impairment of goodwill -- 222,972 -- 222,972 -- Restructuring charges, net 7,717 1,024 1,489 8,623 2,958 Impairment of strategic investment -- -- 3,000 -- 3,000 Other than temporary investment impairment 203 10,104 836 17,144 1,682 Gain on renegotiated design tool agreement -- -- -- -- (749) Realized gain on sale of strategic equity investment -- -- -- -- (4,649) Payroll taxes on certain stock option exercises -- -- -- -- 3 Litigation settlement -- -- 1,125 130 1,125 Option investigation related expenses, net (4) (79) 1,363 80 1,072 Income tax adjustments (196) (4,498) 3,970 (4,306) 3,993 Total GAAP to non-GAAP adjustments - continuing -------- --------- -------- --------- -------- operations 14,384 235,658 19,337 272,728 38,092 -------- --------- -------- --------- -------- Non-GAAP income (loss) - continuing operations $ (8,380) $ 3,295 $ 5,341 $ 11,630 $ (7,113) ======== ========= ======== ========= ======== Diluted income (loss) per share - continuing operations $ (0.13) $ 0.05 $ 0.08 $ 0.18 $ (0.10) ======== ========= ======== ========= ======== Shares used in calculating diluted income (loss) per share 65,703 65,531 65,039 65,480 67,775 ======== ========= ======== ========= ======== Income (loss) per share - continuing operations: GAAP loss per share - continuing operations $ (0.35) $ (3.55) $ (0.22) $ (4.00) $ (0.67) GAAP to non-GAAP adjustments 0.22 3.60 0.30 4.18 0.57 -------- --------- -------- --------- -------- Non-GAAP income (loss) per share - continuing operations $ (0.13) $ 0.05 $ 0.08 $ 0.18 $ (0.10) ======== ========= ======== ========= ======== Reconciliation of shares used in calculating the non-GAAP income per share: Shares used in calculating the basic and diluted income (loss) per share 65,703 65,366 64,886 65,271 67,775 Adjustment for dilutive securities -- 165 153 209 -- -------- --------- -------- --------- -------- Non-GAAP shares used in the EPS calculation 65,703 65,531 65,039 65,480 67,775 ======== ========= ======== ========= ======== Discontinued operations GAAP loss from discontinued operations $ (4,622) $ (42,097) $(72,313) $ (48,235) $(69,916) Adjustments: Stock-based compensation charges 197 358 387 1,198 1,251 Amortization of purchased intangibles 1,040 1,040 1,040 4,160 4,160 Impairment of goodwill -- 41,158 71,494 41,158 71,494 Restructuring charges, net -- 126 27 126 27 Impairment of strategic investment Income tax adjustments (50) 47 27 118 (258) Total GAAP to non-GAAP adjustments - discontinued -------- --------- -------- --------- -------- operations 1,187 42,729 72,975 46,760 76,674 -------- --------- -------- --------- -------- Non-GAAP income (loss) - discontinued operations $ (3,435) $ 632 $ 662 $ (1,475) $ 6,758 ======== ========= ======== ========= ======== Income (loss) per share - discontinued operations: GAAP income (loss) per share - discontinued operations $ (0.07) $ (0.64) $ (1.11) $ (0.74) $ (1.03) GAAP to non-GAAP adjustments 0.02 0.65 1.12 0.72 1.13 -------- --------- -------- --------- -------- Non-GAAP income (loss) per share - discontinued operations $ (0.05) $ 0.01 $ 0.01 $ (0.02) $ 0.10 ======== ========= ======== ========= ======== APPLIED MICRO CIRCUITS CORPORATION RECONCILIATION OF CERTAIN NON-GAAP FINANCIAL MEASURES TO THE MOST DIRECTLY COMPARABLE GAAP FINANCIAL MEASURE (in thousands) (unaudited) The following schedule reconciles certain GAAP financial measures to their corresponding non-GAAP financial measure Three Months Ended Year Ended ----------------------------- ------------------- March 31, Dec. 31, March 31, March 31, March 31, 2009 2008 2008 2009 2008 ----------------------------- ------------------- GROSS PROFIT: GAAP gross profit $19,159 $ 25,500 $ 29,683 $ 113,146 $ 95,359 Gross profit from discontinued operations 437 4,302 5,320 15,412 24,119 Amortization of purchased intangibles 4,308 4,308 4,583 17,780 18,440 Stock-based compensation expense 61 91 135 548 671 ------- --------- --------- --------- -------- Non-GAAP gross profit - consolidated operations $23,965 $ 34,201 $ 39,721 $ 146,886 $138,589 ======= ========= ========= ========= ======== OPERATING EXPENSES: GAAP operating expenses $44,071 $ 254,862 $ 37,993 $ 370,609 $147,370 Operating expenses from discontinued operations 5,215 46,332 77,586 63,575 94,084 Stock-based compensation expense (2,212) (1,814) (2,943) (9,835) (10,636) Amortization of purchased intangibles (1,320) (1,320) (1,320) (5,280) (5,321) Impairment of goodwill -- (264,130) (71,494) (264,130) (71,494) Restructuring charges, net (7,717) (1,150) (1,516) (8,749) (2,985) Gain on renegotiated design tool agreement -- -- -- -- 749 Payroll taxes on certain stock option exercises -- -- -- -- (3) Litigation settlement -- -- (1,125) (130) (1,125) Option investigation related expenses, net 4 79 (1,363) (80) (1,072) ------- --------- --------- --------- -------- Non-GAAP operating expenses - consolidated operations $38,041 $ 32,859 $ 35,818 $ 145,980 $149,567 ======= ========= ========= ========= ======== INTEREST AND OTHER INCOME, NET GAAP interest and other income (expense), net $ 1,693 $ (7,397) $ (1,551) $ (7,581) $ 10,579 Realized gain on sale of strategic equity investments -- -- -- -- (4,649) Impairment of strategic investment -- -- 3,000 -- 3,000 Other than temporary investment impairment 203 10,104 836 17,144 1,682 ------- --------- --------- --------- -------- Non-GAAP interest and other income, net - consolidated operations $ 1,896 $ 2,707 $ 2,285 $ 9,563 $ 10,612 ======= ========= ========= ========= ======== INCOME TAX EXPENSE (BENEFIT): GAAP income tax expense (benefit) $ (455) $ (4,396) $ 4,135 $ (3,946) $ 3,773 Income tax expense (benefit) from discontinued operations (156) 67 47 72 (49) Income tax adjustments 246 4,450 (3,996) 4,188 (3,735) ------- --------- --------- --------- -------- Non-GAAP income tax expense (benefit) - consolidated operations $ (365) $ 121 $ 186 $ 314 $ (11) ======= ========= ========= ========= ======== RESEARCH AND DEVELOPMENT GAAP research and development $24,202 $ 18,625 $ 19,916 $ 84,687 $ 86,117 Research and development from discontinued operations 2,758 2,630 2,976 11,470 11,433 Stock-based compensation expense (853) (1,244) (1,349) (4,532) (4,797) Gain on renegotiated design tool agreement -- -- -- -- 749 Payroll taxes on certain stock option exercises -- -- -- -- (2) ------- --------- --------- --------- -------- Non-GAAP research and development - consolidated operations $26,107 $ 20,011 $ 21,543 $ 91,625 $ 93,500 ======= ========= ========= ========= ======== SELLING, GENERAL AND ADMINISTRATIVE GAAP selling, general and administrative $11,151 $ 11,315 $ 13,095 $ 50,097 $ 52,037 Selling, general and administrative expenses from discontinued operations 2,142 2,103 2,774 9,561 9,870 Stock-based compensation expense (1,359) (570) (1,594) (5,303) (5,839) Payroll taxes on certain stock option exercises -- -- -- -- (1) ------- --------- --------- --------- -------- Non-GAAP selling, general and administrative - consolidated operations $11,934 $ 12,848 $ 14,275 $ 54,355 $ 56,067 ======= ========= ========= ========= ======== APPLIED MICRO CIRCUITS CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands) (unaudited) Year Ended March 31, ----------------------- 2009 2008 ----------- ---------- Operating activities: Net loss $ (309,333) $ (115,121) Adjustments to reconcile net loss to net cash provided by (used for) operating activities Depreciation 6,862 6,542 Amortization of purchased intangibles 23,060 23,762 Impairment of goodwill 264,130 71,494 Stock-based compensation expense: Stock options 5,309 9,350 Restricted stock units 5,222 1,957 Non-cash restructuring charges 1,088 316 Litigation settlement -- 1,125 Net gain on sale of strategic equity investment -- (4,649) Impairment of strategic investment -- 3,000 Impairment of short-term investments and marketable securities 17,144 1,682 Net loss on disposal of property 48 23 Changes in operating assets and liabilities: Accounts receivable 11,263 3,758 Inventories 3,414 (6,680) Other assets (4,141) 2,282 Accounts payable (8,803) (1,375) Accrued payroll and other accrued liabilities 597 (7,103) Deferred taxes (3,957) 3,957 Deferred revenue 668 (476) ----------- ---------- Net cash provided by (used for) operating activities 12,571 (6,156) Investing activities: Proceeds from sales and maturities investments 1,117,424 623,619 Purchases of investments (1,068,205) (550,137) Purchase of strategic investments -- (5,000) Net proceeds from the sale of strategic equity investment -- 5,249 Purchase of property, equipment and other assets (7,259) (7,021) Proceeds from sale of property, equipment and other assets -- 1,646 Net cash paid for acquisitions -- 232 ----------- ---------- Net cash provided by investing activities 41,960 68,588 Financing activities: Proceeds from issuance of common stock 2,448 6,431 Repurchase of Company stock -- (56,950) Funding of structured stock repurchase agreements -- (41,830) Funds received from structured stock repurchase agreements including gains -- 21,112 Other (331) (101) ----------- ---------- Net cash provided by (used for) financing activities 2,117 (71,338) ----------- ---------- Net increase (decrease) in cash and cash equivalents 56,648 (8,906) Cash and cash equivalents at beginning of the period 42,689 51,595 ----------- ---------- Cash and cash equivalents at end of the period $ 99,337 $ 42,689 =========== ==========