Exhibit 99.1
CONTACTS:
Dave Vadasz, investor relations
408.503.7200
dave.vadasz@palmOne.com
Marlene Somsak, media relations
408.503.2592
marlene.somsak@palmOne.com
palmOne Reports Q2 FY05 Results
Revenue Up 39%; Operating Margin is 8.1%
MILPITAS, Calif., Dec. 16, 2004 — palmOne, Inc. (Nasdaq: PLMO) today reported revenue of $376.2 million for the second quarter of fiscal year 2005, ended Nov. 26, which is up approximately 39 percent from the $271.2 million reported during the comparable quarter a year ago.
Net income was $24.7 million, or $0.48 per diluted share. This compares to income from continuing operations in the year-ago period of $2.6 million, or $0.07 per diluted share.
Net income in the second quarter of fiscal year 2005, measured on a non-GAAP(1) basis, totaled $27.2 million, or $0.53 per diluted share, excluding the effects of amortization of intangible assets and deferred stock-based compensation. This compares to a non-GAAP net income in the second quarter of fiscal year 2004 of $5.5 million, or $0.14 per diluted share, which excluded the effects of amortization of intangible assets and deferred stock-based compensation, restructuring charges, and loss from discontinued operations. Operating income was $30.4 million compared with $2.6 million in the year ago quarter.
“Our strategy is working, and this quarter’s excellent growth in revenue and a more than tenfold increase in operating income from the year-ago quarter demonstrate we executed well,” said Todd Bradley, palmOne chief executive officer. “Our fall products raised the bar for competitors and earned widespread acclaim. And we grew our handheld-computer market share domestically and abroad.”
Bradley noted the following financial highlights:
| | • | Revenue grew approximately 39 percent, marking the sixth consecutive quarter of year-over-year growth; |
| | • | Gross margin rose to 29.1 percent in the quarter from 27.1 percent in the comparable quarter a year ago; |
| | • | Operating margin was 8.1 percent, and non-GAAP operating margin was 8.8 percent; |
| | • | Net income was $24.7 million, and non-GAAP net income totaled $27.2 million; |
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| | • | For the quarter, inventory turns rose to 44 times compared with 26 times in the year-ago period; and |
| | • | The company generated $23.7 million in cash from operations in the quarter. |
During the quarter, palmOne announced the following:
| | • | The Tungsten(TM) T5 handheld computer, which features 256MB of memory and doubles as a USB drive. Its new non-volatile file structure means data and applications are preserved, even if the battery runs down, and customers can place documents in file folders; |
| | • | The Treo(TM) 650 smartphone, which features non-volatile memory, a higher-resolution screen and removable battery. Sprint began carrying this new member of the Treo family, and GSM carriers are expected to begin carrying it in the new year; and |
| | • | Integration of the Exchange Server ActiveSync® protocol for out-of-the-box compatibility with Microsoft Exchange Server 2003, including wireless email and calendar, for the Treo 650 smartphone and successors.(2) |
palmOne shipped approximately 1.6 million Zire(TM), Tungsten and Treo family devices during its second fiscal quarter. Unit shipments to date total approximately 29 million.
Investor’s Note
The company will provide a detailed description of its financial results in a conference call and webcast with investors today at 2 p.m. Pacific Time. The dial-in number for the call is 877.825.5811 in the United States and 973.582.2767 for international callers. No pass code is needed. A telephone call replay of the conference call will be available through Dec. 31, 2004, beginning today at approximately 5 p.m. Pacific. The dial-in number for the replay is 877.519.4471 (PIN # 5435468 ) in the United States and 973.341.3080 (PIN #5435468 ) for international callers. The live conference call also will be available over the Internet by logging onto the investor relations section of palmOne’s website athttp://ir.palmOne.com. An audio replay and text transcript of the conference call also can be accessed at the same URL beginning today at approximately 5:30 p.m. Pacific.
NON-GAAP FINANCIAL MEASURES: To supplement the company’s consolidated financial statements presented in accordance with GAAP, palmOne uses non-GAAP measures of certain components of financial performance, including operating income (loss), net income (loss) and per share data, which are adjusted from results based on GAAP to exclude certain expenses, gains and losses. These non-GAAP measures are provided to enhance investors’ overall understanding of the company’s current financial performance and the company’s prospects for the future. Specifically, the company believes the non-GAAP results provide useful information to both management and investors by excluding certain expenses, gains and losses that may not be indicative of its core operating results. These non-GAAP results are among the primary indicators management uses as a basis for planning and forecasting of future periods and facilitating management’s internal comparisons to the company’s historical operating results and comparisons to competitors’ operating results. In addition, because palmOne has historically reported certain non-GAAP results to investors, the company believes the inclusion of non-GAAP measures provides consistency in the company’s financial reporting. These measures should be considered in addition to results prepared in accordance with generally accepted accounting principles, but should not be considered a substitute for, or superior to, GAAP
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results. These non-GAAP financial measures may also be different from non-GAAP financial measures used by other companies. Consistent with the company’s practice, the non-GAAP measures included in this press release have been reconciled to the nearest GAAP measure.
About palmOne, Inc.
palmOne, Inc. — the leader in handheld computing and communications solutions — strives to put the power of computing in people’s hands so they can access and share their most important information. The company’s products include Zire(TM) and Tungsten(TM) handhelds and Treo(TM) smartphones, software and accessories.
palmOne products are sold at The palmOne Store (http://store.palmOne.com/) and palmOne Retail Stores, and through select Internet, retail, reseller and wireless operator partners throughout the world.
More information about palmOne, Inc. is available athttp://www.palmOne.com.
# # #
| (1) | GAAP stands for Generally Accepted Accounting Principles. |
| (2) | Requires Exchange Server 2003 and access enabled by IT administrator. An Internet service provider account, data service and carrier subscription may be required for Internet and email access. These services may need to be purchased separately. Access available within network coverage areas only. |
palmOne, Zire, Tungsten and Treo are among the trademarks or registered trademarks owned by or licensed to palmOne, Inc. or its subsidiaries. All other brand and product names are or may be trademarks of, and are used to identify products or services of, their respective owners.
# # #
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palmOne, Inc.
Condensed Consolidated Statements of Operations
(In thousands, except per share data)
(Unaudited)
| | | | | | | | | | | | | | |
| | | Three Months Ended
| | | Six Months Ended
| |
| | | Nov. 30, 2004
| | Nov. 30, 2003
| | | Nov. 30, 2004
| | Nov. 30, 2003
| |
Revenues | | $ | 376,180 | | $ | 271,215 | | | $ | 649,325 | | $ | 439,823 | |
| | | | |
Costs and operating expenses: | | | | | | | | | | | | | | |
Cost of revenues (*) | | | 266,478 | | | 197,739 | | | | 448,281 | | | 318,963 | |
Sales and marketing | | | 45,048 | | | 43,709 | | | | 82,603 | | | 78,287 | |
Research and development | | | 20,407 | | | 14,948 | | | | 38,975 | | | 31,776 | |
General and administrative | | | 11,312 | | | 9,355 | | | | 21,111 | | | 18,049 | |
Amortization of intangible assets and deferred stock-based compensation (**) | | | 2,527 | | | 1,938 | | | | 4,866 | | | 2,059 | |
Restructuring charges | | | — | | | 918 | | | | — | | | 3,588 | |
| | |
|
| |
|
|
| |
|
| |
|
|
|
Total costs and operating expenses | | | 345,772 | | | 268,607 | | | | 595,836 | | | 452,722 | |
| | |
|
| |
|
|
| |
|
| |
|
|
|
Operating income (loss) | | | 30,408 | | | 2,608 | | | | 53,489 | | | (12,899 | ) |
Interest and other income (expense), net | | | 611 | | | 1,608 | | | | 577 | | | 1,451 | |
| | |
|
| |
|
|
| |
|
| |
|
|
|
Income (loss) before income taxes | | | 31,019 | | | 4,216 | | | | 54,066 | | | (11,448 | ) |
Income tax provision | | | 6,328 | | | 1,584 | | | | 9,781 | | | 2,782 | |
| | |
|
| |
|
|
| |
|
| |
|
|
|
Income (loss) from continuing operations | | | 24,691 | | | 2,632 | | | | 44,285 | | | (14,230 | ) |
Loss from discontinued operations (net of taxes of $0, $4, $0 and $252, respectively ) | | | — | | | (6,750 | ) | | | — | | | (11,634 | ) |
| | |
|
| |
|
|
| |
|
| |
|
|
|
Net income (loss) | | $ | 24,691 | | $ | (4,118 | ) | | $ | 44,285 | | $ | (25,864 | ) |
| | |
|
| |
|
|
| |
|
| |
|
|
|
Net income (loss) per share: | | | | | | | | | | | | | | |
Basic: | | | | | | | | | | | | | | |
Continuing operations | | $ | 0.51 | | $ | 0.07 | | | $ | 0.92 | | $ | (0.43 | ) |
Discontinued operations | | | — | | | (0.18 | ) | | | — | | | (0.35 | ) |
| | |
|
| |
|
|
| |
|
| |
|
|
|
| | | $ | 0.51 | | $ | (0.11 | ) | | $ | 0.92 | | $ | (0.78 | ) |
| | |
|
| |
|
|
| |
|
| |
|
|
|
Diluted: | | | | | | | | | | | | | | |
Continuing operations | | $ | 0.48 | | $ | 0.07 | | | $ | 0.86 | | $ | (0.43 | ) |
Discontinued operations | | | — | | | (0.18 | ) | | | — | | | (0.35 | ) |
| | |
|
| |
|
|
| |
|
| |
|
|
|
| | | $ | 0.48 | | $ | (0.11 | ) | | $ | 0.86 | | $ | (0.78 | ) |
| | |
|
| |
|
|
| |
|
| |
|
|
|
Shares used in computing per share amounts: | | | | | | | | | | | | | | |
Basic | | | 48,381 | | | 36,696 | | | | 48,005 | | | 33,022 | |
Diluted | | | 51,442 | | | 38,743 | | | | 51,223 | | | 33,022 | |
(*) Cost of revenues does not include that portion of amortization of intangible assets and deferred stock-based compensation related to cost of revenues. (**) Amortization of intangible assets and deferred stock-based compensation: | | | | |
| | | | |
Cost of revenues | | $ | 351 | | $ | 84 | | | $ | 663 | | $ | 88 | |
Sales and marketing | | | 1,714 | | | 1,599 | | | | 3,368 | | | 1,657 | |
Research and development | | | 64 | | | 37 | | | | 128 | | | 64 | |
General and administrative | | | 398 | | | 218 | | | | 707 | | | 250 | |
| | |
|
| |
|
|
| |
|
| |
|
|
|
| | | $ | 2,527 | | $ | 1,938 | | | $ | 4,866 | | $ | 2,059 | |
| | |
|
| |
|
|
| |
|
| |
|
|
|
Certain prior quarter balances have been reclassified to conform to the current quarter presentation.
palmOne’s fiscal periods are generally 13 weeks in length and end on a Friday. For presentation purposes, the periods are presented as ending on Aug. 31, Nov. 30, Feb. 28 and May 31.
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palmOne, Inc.
Reconciliation of GAAP to Non-GAAP Condensed Consolidated Statements of Operations
(In thousands, except per share data)
(Unaudited)
| | | | | | | | | | | | | | | | | | | | | |
| | | Three Months Ended Nov. 30, 2004
| | Three Months Ended Nov. 30, 2003
|
| | | GAAP
| | Adjustments
| | | Non-GAAP
| | GAAP
| | | Adjustments
| | | Non-GAAP
|
Revenues | | $ | 376,180 | | $ | — | | | $ | 376,180 | | $ | 271,215 | | | $ | — | | | $ | 271,215 |
| | | | | | |
Costs and operating expenses: | | | | | | | | | | | | | | | | | | | | | |
Cost of revenues (*) | | | 266,478 | | | — | | | | 266,478 | | | 197,739 | | | | — | | | | 197,739 |
Sales and marketing | | | 45,048 | | | — | | | | 45,048 | | | 43,709 | | | | — | | | | 43,709 |
Research and development | | | 20,407 | | | — | | | | 20,407 | | | 14,948 | | | | — | | | | 14,948 |
General and administrative | | | 11,312 | | | — | | | | 11,312 | | | 9,355 | | | | — | | | | 9,355 |
Amortization of intangible assets and deferred stock-based compensation (**) | | | 2,527 | | | (2,527 | ) | | | — | | | 1,938 | | | | (1,938 | ) | | | — |
Restructuring charges | | | — | | | — | | | | — | | | 918 | | | | (918 | ) | | | — |
| | |
|
| |
|
|
| |
|
| |
|
|
| |
|
|
| |
|
|
Total costs and operating expenses | | | 345,772 | | | (2,527 | ) | | | 343,245 | | | 268,607 | | | | (2,856 | ) | | | 265,751 |
| | |
|
| |
|
|
| |
|
| |
|
|
| |
|
|
| |
|
|
Operating income (loss) | | | 30,408 | | | 2,527 | | | | 32,935 | | | 2,608 | | | | 2,856 | | | | 5,464 |
Interest and other income (expense), net | | | 611 | | | — | | | | 611 | | | 1,608 | | | | — | | | | 1,608 |
| | |
|
| |
|
|
| |
|
| |
|
|
| |
|
|
| |
|
|
Income (loss) before income taxes | | | 31,019 | | | 2,527 | | | | 33,546 | | | 4,216 | | | | 2,856 | | | | 7,072 |
Income tax provision | | | 6,328 | | | — | | | | 6,328 | | | 1,584 | | | | — | | | | 1,584 |
| | |
|
| |
|
|
| |
|
| |
|
|
| |
|
|
| |
|
|
Income (loss) from continuing operations | | | 24,691 | | | 2,527 | | | | 27,218 | | | 2,632 | | | | 2,856 | | | | 5,488 |
Loss from discontinued operations (net of taxes of $0 and $4, respectively) | | | — | | | — | | | | — | | | (6,750 | ) | | | 6,750 | | | | — |
| | |
|
| |
|
|
| |
|
| |
|
|
| |
|
|
| |
|
|
Net income (loss) | | $ | 24,691 | | $ | 2,527 | | | $ | 27,218 | | $ | (4,118 | ) | | $ | 9,606 | | | $ | 5,488 |
| | |
|
| |
|
|
| |
|
| |
|
|
| |
|
|
| |
|
|
Net income (loss) per share: | | | | | | | | | | | | | | | | | | | | | |
Basic: | | | | | | | | | | | | | | | | | | | | | |
Continuing operations | | $ | 0.51 | | $ | 0.05 | | | $ | 0.56 | | $ | 0.07 | | | $ | 0.08 | | | $ | 0.15 |
Discontinued operations | | | — | | | — | | | | — | | | (0.18 | ) | | | 0.18 | | | | — |
| | |
|
| |
|
|
| |
|
| |
|
|
| |
|
|
| |
|
|
| | | $ | 0.51 | | $ | 0.05 | | | $ | 0.56 | | $ | (0.11 | ) | | $ | 0.26 | | | $ | 0.15 |
| | |
|
| |
|
|
| |
|
| |
|
|
| |
|
|
| |
|
|
Diluted: | | | | | | | | | | | | | | | | | | | | | |
Continuing operations | | $ | 0.48 | | $ | 0.05 | | | $ | 0.53 | | $ | 0.07 | | | $ | 0.07 | | | $ | 0.14 |
Discontinued operations | | | — | | | — | | | | — | | | (0.18 | ) | | | 0.18 | | | | — |
| | |
|
| |
|
|
| |
|
| |
|
|
| |
|
|
| |
|
|
| | | $ | 0.48 | | $ | 0.05 | | | $ | 0.53 | | $ | (0.11 | ) | | $ | 0.25 | | | $ | 0.14 |
| | |
|
| |
|
|
| |
|
| |
|
|
| |
|
|
| |
|
|
Shares used in computing per share amounts: | | | | | | | | | | | | | | | | | | | | | |
Basic | | | 48,381 | | | — | | | | 48,381 | | | 36,696 | | | | — | | | | 36,696 |
Diluted | | | 51,442 | | | — | | | | 51,442 | | | 38,743 | | | | — | | | | 38,743 |
(*) Cost of revenues does not include that portion of amortization of intangible assets and deferred stock-based compensation related to cost of revenues. (**) Amortization of intangible assets and deferred stock-based compensation: |
|
| | | | | | |
Cost of revenues | | $ | 351 | | $ | (351 | ) | | $ | — | | $ | 84 | | | $ | (84 | ) | | $ | — |
Sales and marketing | | | 1,714 | | | (1,714 | ) | | | — | | | 1,599 | | | | (1,599 | ) | | | — |
Research and development | | | 64 | | | (64 | ) | | | — | | | 37 | | | | (37 | ) | | | — |
General and administrative | | | 398 | | | (398 | ) | | | — | | | 218 | | | | (218 | ) | | | — |
| | |
|
| |
|
|
| |
|
| |
|
|
| |
|
|
| |
|
|
| | | $ | 2,527 | | $ | (2,527 | ) | | $ | — | | $ | 1,938 | | | $ | (1,938 | ) | | $ | — |
| | |
|
| |
|
|
| |
|
| |
|
|
| |
|
|
| |
|
|
The above non-GAAP amounts have been adjusted to eliminate amortization of intangible assets and deferred stock-based compensation, restructuring charges and loss from discontinued operations.
Certain prior quarter balances have been reclassified to conform to the current quarter presentation.
palmOne’s fiscal periods are generally 13 weeks in length and end on a Friday. For presentation purposes, the periods are presented as ending on Aug. 31, Nov. 30, Feb. 28 and May 31.
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palmOne, Inc.
Reconciliation of GAAP to Non-GAAP Condensed Consolidated Statements of Operations
(In thousands, except per share data)
(Unaudited)
| | | | | | | | | | | | | | | | | | | | | | |
| | | Six Months Ended Nov. 30, 2004
| | Six Months Ended Nov. 30, 2003
| |
| | | GAAP
| | Adjustments
| | | Non-GAAP
| | GAAP
| | | Adjustments
| | | Non-GAAP
| |
Revenues | | $ | 649,325 | | $ | — | | | $ | 649,325 | | $ | 439,823 | | | $ | — | | | $ | 439,823 | |
| | | | | | |
Costs and operating expenses: | | | | | | | | | | | | | | | | | | | | | | |
Cost of revenues (*) | | | 448,281 | | | — | | | | 448,281 | | | 318,963 | | | | — | | | | 318,963 | |
Sales and marketing | | | 82,603 | | | — | | | | 82,603 | | | 78,287 | | | | — | | | | 78,287 | |
Research and development | | | 38,975 | | | — | | | | 38,975 | | | 31,776 | | | | — | | | | 31,776 | |
General and administrative | | | 21,111 | | | — | | | | 21,111 | | | 18,049 | | | | — | | | | 18,049 | |
Amortization of intangible assets and deferred stock-based compensation (**) | | | 4,866 | | | (4,866 | ) | | | — | | | 2,059 | | | | (2,059 | ) | | | — | |
Restructuring charges | | | — | | | — | | | | — | | | 3,588 | | | | (3,588 | ) | | | — | |
| | |
|
| |
|
|
| |
|
| |
|
|
| |
|
|
| |
|
|
|
Total costs and operating expenses | | | 595,836 | | | (4,866 | ) | | | 590,970 | | | 452,722 | | | | (5,647 | ) | | | 447,075 | |
| | |
|
| |
|
|
| |
|
| |
|
|
| |
|
|
| |
|
|
|
Operating income (loss) | | | 53,489 | | | 4,866 | | | | 58,355 | | | (12,899 | ) | | | 5,647 | | | | (7,252 | ) |
Interest and other income (expense), net | | | 577 | | | — | | | | 577 | | | 1,451 | | | | — | | | | 1,451 | |
| | |
|
| |
|
|
| |
|
| |
|
|
| |
|
|
| |
|
|
|
Income (loss) before income taxes | | | 54,066 | | | 4,866 | | | | 58,932 | | | (11,448 | ) | | | 5,647 | | | | (5,801 | ) |
Income tax provision | | | 9,781 | | | — | | | | 9,781 | | | 2,782 | | | | — | | | | 2,782 | |
| | |
|
| |
|
|
| |
|
| |
|
|
| |
|
|
| |
|
|
|
Income (loss) from continuing operations | | | 44,285 | | | 4,866 | | | | 49,151 | | | (14,230 | ) | | | 5,647 | | | | (8,583 | ) |
Loss from discontinued operations (net of taxes of $0 and $252, respectively) | | | — | | | — | | | | — | | | (11,634 | ) | | | 11,634 | | | | — | |
| | |
|
| |
|
|
| |
|
| |
|
|
| |
|
|
| |
|
|
|
Net income (loss) | | $ | 44,285 | | $ | 4,866 | | | $ | 49,151 | | $ | (25,864 | ) | | $ | 17,281 | | | $ | (8,583 | ) |
| | |
|
| |
|
|
| |
|
| |
|
|
| |
|
|
| |
|
|
|
Net income (loss) per share: | | | | | | | | | | | | | | | | | | | | | | |
Basic: | | | | | | | | | | | | | | | | | | | | | | |
Continuing operations | | $ | 0.92 | | $ | 0.10 | | | $ | 1.02 | | $ | (0.43 | ) | | $ | 0.17 | | | $ | (0.26 | ) |
Discontinued operations | | | — | | | — | | | | — | | | (0.35 | ) | | | 0.35 | | | | — | |
| | |
|
| |
|
|
| |
|
| |
|
|
| |
|
|
| |
|
|
|
| | | $ | 0.92 | | $ | 0.10 | | | $ | 1.02 | | $ | (0.78 | ) | | $ | 0.52 | | | $ | (0.26 | ) |
| | |
|
| |
|
|
| |
|
| |
|
|
| |
|
|
| |
|
|
|
Diluted: | | | | | | | | | | | | | | | | | | | | | | |
Continuing operations | | $ | 0.86 | | $ | 0.10 | | | $ | 0.96 | | $ | (0.43 | ) | | $ | 0.17 | | | $ | (0.26 | ) |
Discontinued operations | | | — | | | — | | | | — | | | (0.35 | ) | | | 0.35 | | | | — | |
| | |
|
| |
|
|
| |
|
| |
|
|
| |
|
|
| |
|
|
|
| | | $ | 0.86 | | $ | 0.10 | | | $ | 0.96 | | $ | (0.78 | ) | | $ | 0.52 | | | $ | (0.26 | ) |
| | |
|
| |
|
|
| |
|
| |
|
|
| |
|
|
| |
|
|
|
Shares used in computing per share amounts: | | | | | | | | | | | | | | | | | | | | | | |
Basic | | | 48,005 | | | — | | | | 48,005 | | | 33,022 | | | | — | | | | 33,022 | |
Diluted | | | 51,223 | | | — | | | | 51,223 | | | 33,022 | | | | — | | | | 33,022 | |
(**) Cost of revenues does not include that portion of amortization of intangible assets and deferred stock-based compensation related to cost of revenues. (*) Amortization of intangible assets and deferred stock-based compensation: | | | | | |
| |
| | | | | | |
Cost of revenues | | $ | 663 | | $ | (663 | ) | | $ | — | | $ | 88 | | | $ | (88 | ) | | $ | — | |
Sales and marketing | | | 3,368 | | | (3,368 | ) | | | — | | | 1,657 | | | | (1,657 | ) | | | — | |
Research and development | | | 128 | | | (128 | ) | | | — | | | 64 | | | | (64 | ) | | | — | |
General and administrative | | | 707 | | | (707 | ) | | | — | | | 250 | | | | (250 | ) | | | — | |
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| | | $ | 4,866 | | $ | (4,866 | ) | | $ | — | | $ | 2,059 | | | $ | (2,059 | ) | | $ | — | |
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The above non-GAAP amounts have been adjusted to eliminate amortization of intangible assets and deferred stock-based compensation, restructuring charges and loss from discontinued operations.
Certain prior quarter balances have been reclassified to conform to the current quarter presentation.
palmOne’s fiscal periods are generally 13 weeks in length and end on a Friday. For presentation purposes, the periods are presented as ending on Aug. 31, Nov. 30, Feb. 28 and May 31.
- 6 -
palmOne, Inc.
Condensed Consolidated Balance Sheets
(In thousands, except par value amounts)
(Unaudited)
| | | | | | | | |
| | | November 30, 2004
| | | May 31, 2004
| |
ASSETS | | | | | | | | |
Current assets: | | | | | | | | |
Cash and cash equivalents | | $ | 236,146 | | | $ | 203,069 | |
Short-term investments | | | 76,737 | | | | 49,382 | |
Accounts receivable, net of allowance for doubtful accounts of $8,702 and $8,317, respectively | | | 219,427 | | | | 120,757 | |
Inventories | | | 29,119 | | | | 14,030 | |
Investment for committed tenant improvements | | | 6,956 | | | | 7,197 | |
Prepaids and other | | | 9,970 | | | | 8,067 | |
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Total current assets | | | 578,355 | | | | 402,502 | |
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Restricted investments | | | 775 | | | | 1,175 | |
Land not in use | | | 60,000 | | | | 60,000 | |
Property and equipment, net | | | 18,620 | | | | 19,425 | |
Goodwill | | | 253,372 | | | | 257,363 | |
Intangible assets, net | | | 7,104 | | | | 10,979 | |
Deferred income taxes | | | 34,800 | | | | 34,800 | |
Other assets | | | 1,575 | | | | 1,694 | |
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Total assets | | $ | 954,601 | | | $ | 787,938 | |
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LIABILITIES AND STOCKHOLDERS’ EQUITY | | | | | | | | |
Current liabilities: | | | | | | | | |
Accounts payable | | $ | 184,548 | | | $ | 112,772 | |
Accrued restructuring | | | 20,909 | | | | 27,156 | |
Provision for committed tenant improvements | | | 6,956 | | | | 7,197 | |
Other accrued liabilities | | | 155,360 | | | | 112,679 | |
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Total current liabilities | | | 367,773 | | | | 259,804 | |
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Non-current liabilities: | | | | | | | | |
Long-term convertible debt | | | 35,000 | | | | 35,000 | |
Other non-current liabilities | | | 1,300 | | | | 1,600 | |
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Stockholders’ equity: | | | | | | | | |
Preferred stock, $.001 par value, 125,000 shares authorized; none outstanding | | | — | | | | — | |
Common stock, $.001 par value, 2,000,000 shares authorized; outstanding: 48,723 shares and 47,032 shares, respectively | | | 49 | | | | 47 | |
Additional paid-in capital | | | 1,399,346 | | | | 1,383,630 | |
Unamortized deferred stock-based compensation | | | (3,576 | ) | | | (1,995 | ) |
Accumulated deficit | | | (846,353 | ) | | | (890,638 | ) |
Accumulated other comprehensive income | | | 1,062 | | | | 490 | |
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Total stockholders’ equity | | | 550,528 | | | | 491,534 | |
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Total liabilities and stockholders’ equity | | $ | 954,601 | | | $ | 787,938 | |
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Certain prior year balances have been reclassified to conform to the current quarter presentation.
palmOne’s fiscal periods are generally 13 weeks in length and end on a Friday. For presentation purposes, the periods are presented as ending on Aug. 31, Nov. 30, Feb. 28 and May 31.
- 7 -
palmOne, Inc.
Condensed Consolidated Statements of Cash Flows
(In thousands)
(Unaudited)
| | | | | | | | |
| | | Three Months Ended
| |
| | | Nov. 30, 2004
| | | Nov. 30, 2003
| |
Cash flows from operating activities: | | | | | | | | |
Income from continuing operations | | $ | 24,691 | | | $ | 2,632 | |
Adjustments to reconcile income from continuing operations to net cash provided by (used in) operating activities: | | | | | | | | |
Depreciation | | | 3,728 | | | | 5,701 | |
Amortization | | | 2,527 | | | | 2,411 | |
Changes in assets and liabilities, net of effect of business acquisition: | | | | | | | | |
Accounts receivable | | | (85,802 | ) | | | (67,372 | ) |
Inventories | | | (9,967 | ) | | | (8,238 | ) |
Prepaids and other | | | (2,095 | ) | | | 1,585 | |
Accounts payable | | | 56,217 | | | | 30,214 | |
Accrued restructuring | | | (1,174 | ) | | | (4,517 | ) |
Other accrued liabilities | | | 35,550 | | | | 8,370 | |
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Net cash provided by (used in) operating activities | | | 23,675 | | | | (29,214 | ) |
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Cash flows from investing activities: | | | | | | | | |
Purchase of property and equipment | | | (4,853 | ) | | | (1,818 | ) |
Acquisition of a business, net of cash acquired | | | — | | | | 16,114 | |
Spin-off of PalmSource | | | — | | | | (6,000 | ) |
Purchase of short-term investments | | | (13,029 | ) | | | — | |
Sale of short-term investments | | | 15,062 | | | | — | |
Sale of restricted investments | | | — | | | | 1,896 | |
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Net cash provided by (used in) investing activities | | | (2,820 | ) | | | 10,192 | |
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Cash flows from financing activities: | | | | | | | | |
Proceeds from issuance of common stock; employee stock plans | | | 4,325 | | | | 9,516 | |
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Net cash provided by financing activities | | | 4,325 | | | | 9,516 | |
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Change in cash and cash equivalents | | | 25,180 | | | | (9,506 | ) |
Cash and cash equivalents, beginning of period | | | 210,966 | | | | 227,701 | |
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Cash and cash equivalents, end of period | | $ | 236,146 | | | $ | 218,195 | |
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Other cash flow information: | | | | | | | | |
Cash paid for income taxes | | $ | (2,005 | ) | | $ | (731 | ) |
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Cash paid for interest | | $ | (33 | ) | | $ | (21 | ) |
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Fair value of stock options and warrants assumed in business acquisition | | $ | — | | | $ | 28,064 | |
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Common stock issued for a business combination | | $ | — | | | $ | 209,173 | |
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Certain prior quarter balances have been reclassified to conform to the current quarter presentation.
palmOne’s fiscal periods are generally 13 weeks in length and end on a Friday. For presentation purposes, the periods are presented as ending on Aug. 31, Nov. 30, Feb. 28 and May 31.
# # #
- 8 -
