Exhibit 99
InterVideo Reports Fourth Quarter and Fiscal Year 2003 Results
Fremont, Calif., February 4, 2004 — InterVideo, Inc. (Nasdaq: IVII — News), a leading provider of DVD software, today reported financial results for the fourth quarter and fiscal year ended December 31, 2003.
For the fourth quarter of 2003, InterVideo reported revenue of $16.2 million, an increase of 43% over the fourth quarter of 2002, and an increase of 13% over the third quarter of 2003. Net income for the fourth quarter of 2003 was $2.3 million, or $0.15 per diluted share, as compared to net income of $1.3 million, or $0.10 per diluted share, reported in the fourth quarter of 2002, and net income of $2.4 million or $0.16 per diluted share reported in the third quarter of 2003.
The Company generated $5.3 million in cash from operations and closed the quarter with $69.7 million in cash, cash equivalents and short-term investments.
For the fiscal year ended December 31, 2003, revenue increased 25% over the prior year to $57.1 million. Net income for 2003 was $7.8 million, or $0.57 per diluted share, as compared to net income of $7.7 million, or $0.65 per diluted share, for the same period in 2002. The Company reported operating margins of 20% for fiscal year 2003, as compared to 11% reported for fiscal year 2002.
“We are satisfied with our fourth quarter financial performance which wraps up a solid year for InterVideo,” commented president & CEO, Steve Ro. “We continued to experience strong sales of our core WinDVD product, and saw good growth in demand for some of our newer products, including WinDVD Creator. We expanded our strategic relationships with key OEM partners through the addition of new products and were pleased with the level of activity through these partners in the quarter. Importantly, we introduced InterVideo InstantON, an innovative new software solution that converts home PCs into home entertainment centers with features such as television, PVR, CD/MP3, DVD Recorder, and radio that allows PC OEMs to increase market share by entering the living room without additional hardware costs.
“Looking ahead, we enter 2004 with confidence in our products and our technological leadership. We believe there are significant opportunities for our business in the coming quarters, as we offer more products through our OEM partners and continue to develop and introduce innovative multi-media solutions that are applicable for many consumer electronics applications,” concluded Mr. Ro.
Business Outlook
The following statements are based on current expectations and information available to us as of February 4, 2004; we do not undertake a duty to update them. Our ability to project future results is inherently uncertain. These statements are “forward-looking” and actual results may differ materially as a result of risks outlined below.
The Company expects revenues for the first quarter of 2004 to be in the range of $16 to $17 million. The Company expects earnings per share on a diluted basis, using approximately 16.3 million shares, to be in the range of $0.12-$0.14 per share for the first quarter of 2004. For the full year 2004 the Company expects revenues to be in the range of $67 to $71 million. The Company expects earnings per share on a diluted basis, using approximately 16.7 million shares, to be in the range of $0.60-$0.66.
Conference Call Details
The InterVideo Fourth Quarter and Fiscal Year 2003 teleconference and webcast is scheduled to begin at 5:00 p.m. Eastern Time, on Wednesday, February 4, 2004. To participate on the live call, analysts, investors and the general public should dial 800-289-0468 at least ten minutes prior to the call. InterVideo will also offer a live and archived webcast of the conference call, accessible from the “Investor Relations” section of the company’s Web site athttp://www.investor.intervideo.com/medialist.cfm
About InterVideo, Inc.
InterVideo is a leading provider of DVD software. InterVideo has developed a technology platform from which it has created a broad suite of integrated multimedia software products that allow users to capture, edit, author, burn, distribute, and play digital video. InterVideo’s software is bundled with products sold by the majority of the leading PC OEMs. The company is headquartered in Fremont, CA with regional offices in Europe, Taiwan, China and Japan. For more information, contact InterVideo at 510-651-0888 or visit the company’s Web site atwww.intervideo.com.
Safe Harbor Statement
Except for the historical statements contained herein, the foregoing release contains forward-looking statements, including statements regarding, among other matters, our future financial performance, including expected revenues and earnings per share, our ability to capitalize on our technology, product development and the growth of business opportunities. These forward-looking statements are subject to risks and uncertainties, and actual results could differ materially due to several factors, including but not limited to the ability to forecast customer behavior and recognize or respond to emerging trends, changing preferences or competitive factors, the market acceptance of our new products and product enhancements, claims regarding alleged infringement of third parties’ intellectual property rights, the ability to maintain or expand our relationship with our retail and OEM customers and other risks and uncertainties. Please consult the various reports and documents filed by InterVideo with the U.S. Securities and Exchange Commission, including but not limited to InterVideo’s Form S-1/A and last quarterly report on Form 10-Q for factors potentially affecting the Company’s future financial results. All forward-looking statements are made as of the date hereof and InterVideo disclaims any responsibility to update or revise any forward-looking statement provided in this news release. The results for the quarter and fiscal year ended December 31, 2003 are not necessarily indicative of InterVideo’s operating results for any future periods.
InterVideo is a registered trademark of InterVideo, Inc. All other trademarks are the property of their respective holders.
Investor contacts:
Erica Abrams, Annie Palmore
the blueshirt group for InterVideo
415-217-7722
erica@blueshirtgroup.com
annie@blueshirtgroup.com
INTERVIDEO, INC.
CONSOLIDATED STATEMENT OF OPERATIONS
(in thousands, except per share amounts)
(unaudited)
Three months ended December 31 | Year ended December 31 | ||||||||||||
2003 | 2002 | 2003 | 2002 | ||||||||||
Revenue | $ | 16,248 | $ | 11,349 | $ | 57,078 | $ | 45,494 | |||||
Cost of revenue: | 7,588 | 4,752 | 23,849 | 16,879 | |||||||||
Gross Profit | 8,660 | 6,597 | 33,229 | 28,615 | |||||||||
Operating Expenses: | |||||||||||||
Research and development | 2,098 | 1,556 | 7,626 | 7,185 | |||||||||
Sales and marketing | 2,283 | 2,453 | 8,908 | 8,179 | |||||||||
General and administrative | 1,487 | 946 | 4,358 | 3,883 | |||||||||
Stock compensation | 172 | 274 | 911 | 2,469 | |||||||||
Restructuring cost | — | — | — | 1,708 | |||||||||
Total operating expenses | 6,040 | 5,229 | 21,803 | 23,424 | |||||||||
Income from operations | 2,620 | 1,368 | 11,426 | 5,191 | |||||||||
Other income (expenses), net | 249 | 133 | 563 | 129 | |||||||||
Income before tax | 2,869 | 1,501 | 11,989 | 5,320 | |||||||||
Provision for income tax | 612 | 251 | 4,196 | (2,409 | ) | ||||||||
Net income after tax | $ | 2,257 | $ | 1,250 | $ | 7,793 | $ | 7,729 | |||||
Earnings per share: | |||||||||||||
Basic | $ | 0.18 | $ | 0.49 | $ | 1.07 | $ | 3.15 | |||||
Diluted | $ | 0.15 | $ | 0.10 | $ | 0.57 | $ | 0.65 | |||||
Weighted average shares used in computing earnings per share: | |||||||||||||
Basic | 12,848 | 2,528 | 7,273 | 2,456 | |||||||||
Diluted | 15,419 | 12,093 | 13,723 | 11,945 |
INTERVIDEO, INC.
CONSOLIDATED BALANCE SHEETS
(in thousands, except per share amounts)
As of December 31 | ||||||||
2003 | 2002 | |||||||
Current Assets: | ||||||||
Cash and cash equivalents | $ | 46,875 | $ | 17,137 | ||||
Short term investments | 22,862 | 4,104 | ||||||
Accounts receivable (net of $254 and $205 allowance, respectively) | 5,515 | 3,902 | ||||||
Deferred tax assets | 1,543 | 2,122 | ||||||
Prepayments and other current assets | 1,976 | 694 | ||||||
Inventory | 492 | — | ||||||
Total current assets | 79,263 | 27,959 | ||||||
Property and equipment, net | 2,241 | 1,566 | ||||||
Goodwill | 1,018 | 1,018 | ||||||
Other purchased intangible assets | 283 | 483 | ||||||
Deferred tax assets | 4,685 | 3,335 | ||||||
Other assets | 429 | 355 | ||||||
Total assets | $ | 87,919 | $ | 34,716 | ||||
Current liabilities: | ||||||||
Accounts payable | $ | 1,039 | $ | 413 | ||||
Accrued liabilities | 9,503 | 9,639 | ||||||
Income tax payable | 1,539 | 1,111 | ||||||
Deferred revenue | 3,422 | 1,112 | ||||||
Total current liabilities | 15,503 | 12,275 | ||||||
Stockholders’ equity: | ||||||||
Convertible preferred stock, $0.001 par value, 5,000 and 13,000 shares authorized, Liquidation preference of Nil and $23,855 respectively, Nil and 12,839 shares issued and outstanding, respectively | — | 13 | ||||||
Common stock, $0.001 par value, 150,000 and 25,000 shares authorized, 12,970 and 2,644 shares issued and outstanding, respectively | 13 | 3 | ||||||
Additional paid-in capital | 76,283 | 35,197 | ||||||
Notes receivable from stockholders | (905 | ) | (864 | ) | ||||
Deferred stock compensation | (531 | ) | (1,614 | ) | ||||
Accumulated other comprehensive loss | (123 | ) | (180 | ) | ||||
Accumulated deficit | (2,321 | ) | (10,114 | ) | ||||
Total stockholder’s equity | 72,416 | 22,441 | ||||||
Total liabilities and stockholders’ equity | $ | 87,919 | $ | 34,716 | ||||