SAN JOSE, Calif., April 30, 2013 /PRNewswire/ -- Cavium, Inc. (NASDAQ: CAVM), a leading provider of highly integrated semiconductor products that enable intelligent processing for networking, communications, and the digital home, today announced financial results for the first quarter of 2013 ended March 31, 2013.
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Revenue in the first quarter of 2013 was $69.5 million, a 4.8% sequential increase from the $66.4 million reported in the fourth quarter of 2012.
Generally Accepted Accounting Principles (GAAP) Results
Net loss attributable to the Company for the first quarter of 2013, on GAAP basis was $3.2 million, or $(0.06) per diluted share compared to $78.8 million, or $(1.56) per diluted share in the fourth quarter of 2012. Net loss for the fourth quarter of 2012 included a non-cash charge of $43.5 million to provide for a valuation allowance for net deferred tax assets and non-cash charges for goodwill and other intangible asset impairment of $33.3 million. Gross margins were 62.4% in the first quarter of 2013 compared to 62.3% in the fourth quarter of 2012. Total cash and cash equivalents were $86.5 million at March 31, 2013.
Non-GAAP Results
Cavium believes that the presentation of non-GAAP financial measures provides important supplemental information to management and investors regarding financial and business trends relating to Cavium's financial condition and results of operations. These measures should only be used to evaluate Cavium's results of operations in conjunction with the corresponding GAAP measures. The reconciliation between GAAP and non-GAAP financial results is provided in the financial statements portion of this release.
Non-GAAP net income for the first quarter of 2013 was $10.2 million or $0.19 per diluted share, compared with non-GAAP net income of $10.6 million or $0.20 per diluted share in the fourth quarter of 2012. Gross margins, on a non-GAAP basis, were 65.4% and operating margins (non-GAAP income from operations as a percentage of revenue), on a non-GAAP basis were 16.0% in the first quarter of 2013.
Recent News Highlights
- February 26, 2013 - Cavium's PureVu® Powers ZTE's NEW Wireless Display Adapter for the Latest Grand Memo Smartphones
- February 25, 2013 - Cavium Demonstrated Innovative Mobile Infrastructure Solutions for Next Generation Radio Access, Core Network, and Wireless Display Manufacturers at Mobile World Congress
- February 25, 2013 - Cavium's PureVu® Enables Superior Wireless Display Consumer Experience for Huawei's Line of Ascend Smartphones
- February 25, 2013 - LG U+ Selects Cavium's OCTEON Fusion® to Light up its LTE Small Cell Rollouts
- February 21, 2013 - AirHop Communications and Cavium Sign Commercial Agreement to Integrate AirHop's eSONTM Software with Cavium's LTE Small Cell "BaseStation-on-a-Chip" Family
- February 19, 2013 - Advantech Unveils Support For Cavium's TurboDPI™ II on New Packetarium™ Network Processor Platform and High-end ATCA Blade
- February 19, 2013 - Cavium Introduces TurboDPI™ II for OCTEON® Processors – Takes Deep Packet Inspection (DPI) To the Next Level
- January 31, 2013 - Cavium Announces Carrier Grade, Enterprise Quality,Commercial Software Development Environment for All OCTEON® Processors
- January 31, 2013 - Cavium Announces Project Thunder Software Development Platform for Cloud and Data Centers
- January 31, 2013 - Cavium Collaborates with the Fedora Project to Support Project Thunder 64-bit ARMv8 Processors
Cavium, Inc. will broadcast its first quarter 2013 financial results conference call today, April 30, 2013, at 2 p.m. Pacific time (5 p.m. Eastern time). The conference call will be available via a live web cast on the investor relations section of the Cavium website at http://www.cavium.com. Please access the website at least a few minutes prior to the start of the call in order to download and install any necessary audio software. An archived web cast replay of the call will be available on the web site for a limited period of time.
About Cavium
Cavium is a leading provider of highly integrated semiconductor products that enable intelligent processing for networking, communications and the digital home. Cavium offers a broad portfolio of integrated, software-compatible processors ranging in performance from 10 Mbps to 100 Gbps that enable secure, intelligent functionality in enterprise, data-center, broadband/consumer and access and service provider equipment. Cavium processors are supported by ecosystem partners that provide operating systems, tool support, reference designs and other services. Cavium's principal office is in San Jose, CA with design team locations in California, Massachusetts, India and China. For more information, please visit: http://www.cavium.com.
CAVIUM, INC. |
Unaudited GAAP Condensed Consolidated Statements of Operations |
(in thousands, except per share amounts) |
| Three Months Ended |
| March 31, 2013 |
| December 31, 2012 |
Net revenue | $ 69,530 |
| $ 66,369 |
Cost of revenue | 26,159 |
| 25,049 |
Gross profit | 43,371 |
| 41,320 |
Operating expenses: |
|
|
|
Research and development | 32,415 |
| 29,318 |
Sales, general and administrative | 15,240 |
| 21,608 |
Goodwill impairment | - |
| 27,680 |
Total operating expenses | 47,655 |
| 78,606 |
Loss from operations before other expense net, income taxes and non-controlling interest | (4,284) |
| (37,286) |
Other expense, net: |
|
|
|
Interest expense | (342) |
| (581) |
Other, net | (261) |
| (164) |
Total other expense, net | (603) |
| (745) |
Loss before income taxes and non-controlling interest | (4,887) |
| (38,031) |
Provision for (benefit from) income taxes | 426 |
| 41,415 |
Net loss | (5,313) |
| (79,446) |
Net loss attributable to non-controlling interest | (2,129) |
| (607) |
Net loss attributable to the Company | $ (3,184) |
| $ (78,839) |
Net loss attributable to the Company per common share, basic | $ (0.06) |
| $ (1.56) |
Shares used in computing basic net loss per common share | 51,001 |
| 50,490 |
Net loss attributable to the Company per common share, diluted | $ (0.06) |
| $ (1.56) |
Shares used in computing diluted net loss per common share | 51,001 |
| 50,490 |
|
|
|
|
|
|
|
|
CAVIUM, INC. |
Unaudited Reconciliation of Non-GAAP Adjustments |
(in thousands) |
| Three Months Ended |
Reconciliation of GAAP research and development expenses to non-GAAP: | March 31, 2013 |
| December 31, 2012 |
|
|
|
GAAP research and development expenses | $ 32,415 |
| $ 29,318 |
Stock-based compensation and related payroll taxes | (4,042) |
| (4,070) |
Acquisition and restructuring related expenses | (919) |
| (98) |
Acquisition and restructuring related compensation expenses | (255) |
| (249) |
Expenses associated from a variable interest entity | (3,585) |
| (2,880) |
Non-GAAP research and development expenses | $ 23,614 |
| $ 22,021 |
Reconciliation of GAAP sales, general and administrative expenses to non-GAAP |
|
|
|
GAAP sales, general and administrative expenses | $ 15,240 |
| $ 21,608 |
Stock-based compensation and related payroll taxes | (4,149) |
| (4,091) |
Amortization of acquired intangible assets | (200) |
| (200) |
Acquisition and restructuring related expenses | (231) |
| (95) |
Acquisition and restructuring related compensation expenses | (683) |
| (40) |
Write-down of acquired intangible assets | - |
| (5,570) |
Gain on sale of certain assets | 747 |
| - |
Non-GAAP sales, general and administrative expenses | $ 10,724 |
| $ 11,612 |
|
|
|
|
CAVIUM, INC. |
Unaudited Reconciliation of Non-GAAP Adjustments |
(in thousands, except per share data and percentages) |
|
|
|
|
| Three Months Ended |
| March 31, 2013 |
| December 31, 2012 |
Reconciliation of GAAP gross profit & margin to non-GAAP: |
|
|
|
Net revenue | $ 69,530 |
| $ 66,369 |
GAAP gross profit | 43,371 |
| 41,320 |
GAAP gross margin | 62.4% |
| 62.3% |
|
|
|
|
Stock-based compensation and related payroll taxes | 296 |
| 432 |
Amortization of acquired intangible assets | 1,607 |
| 1,625 |
Acquisition and restructuring related expenses | 178 |
| (571) |
Non-GAAP gross profit | $ 45,452 |
| $ 42,806 |
Non-GAAP gross margin | 65.4% |
| 64.5% |
|
|
|
|
| Three Months Ended |
| March 31, 2013 |
| December 31, 2012 |
Reconciliation of GAAP loss from operations to non-GAAP income from operations: |
|
|
|
GAAP loss from operations | $ (4,284) |
| $ (37,286) |
Stock-based compensation and related payroll taxes | 8,487 |
| 8,593 |
Amortization of acquired intangible assets | 1,807 |
| 1,825 |
Acquisition and restructuring related expenses | 1,328 |
| (378) |
Acquisition and restructuring related compensation expenses | 938 |
| 289 |
Write-down of acquired intangible assets | - |
| 5,570 |
Goodwill impairment | - |
| 27,680 |
Gain on sale of certain assets | (747) |
| - |
Loss from operations of a variable interest entity | 3,585 |
| 2,880 |
Non-GAAP income from operations | $ 11,114 |
| $ 9,173 |
Non-GAAP income from operations as a percentage of revenue | 16.0% |
| 13.8% |
|
|
|
|
| Three Months Ended |
| March 31, 2013 |
| December 31, 2012 |
Reconciliation of GAAP net loss to non-GAAP net income: |
|
|
|
GAAP net loss attributable to the Company | $ (3,184) |
| $ (78,839) |
Non-GAAP adjustments: |
|
|
|
Stock-based compensation and related payroll taxes: |
|
|
|
Cost of revenue | 296 |
| 432 |
Research and development | 4,042 |
| 4,070 |
Sales, general and administrative | 4,149 |
| 4,091 |
Amortization of acquired intangible assets: |
|
|
|
Cost of revenue | 1,607 |
| 1,625 |
Sales, general and administrative | 200 |
| 200 |
Acquisition and restructuring related expenses | 1,328 |
| (378) |
Acquisition and restructuring related compensation expenses | 938 |
| 289 |
Gain on sale of certain assets | (747) |
| - |
Net loss of a variable interest entity attributable to the Company | 1,594 |
| 2,396 |
Write-down of acquired intangible assets | - |
| 5,570 |
Goodwill impairment | - |
| 27,680 |
Valuation allowance on deferred tax assets | - |
| 43,505 |
Total of non-GAAP adjustments | 13,407 |
| 89,480 |
Non-GAAP net income | $ 10,223 |
| $ 10,641 |
|
|
|
|
GAAP net loss attributable to the Company per share, diluted | $ (0.06) |
| $ (1.56) |
Non-GAAP adjustments detailed above | 0.25 |
| 1.76 |
Non-GAAP net income per share, diluted | $ 0.19 |
| $ 0.20 |
|
|
|
|
GAAP weighted average shares, diluted | 51,001 |
| 50,490 |
Non-GAAP share adjustment | 3,705 |
| 3,974 |
Non-GAAP weighted average shares, diluted | 54,706 |
| 54,464 |
CAVIUM, INC. |
Unaudited GAAP Condensed Consolidated Balance Sheets |
(in thousands) |
|
|
|
|
|
|
|
| As of |
|
|
| March 31, 2013 | December 31, 2012 |
Assets |
|
|
|
Current assets: |
|
|
| Cash and cash equivalents | $ 86,511 | $ 76,784 |
| Accounts receivable, net | 36,127 | 33,567 |
| Inventories | 41,403 | 46,508 |
| Prepaid expenses and other current assets | 3,315 | 4,865 |
| Assets held for sale | - | 2,609 |
| Deferred tax assets | 508 | 568 |
|
| Total current assets | 167,864 | 164,901 |
Property and equipment, net | 28,805 | 30,692 |
Intangible assets, net | 59,037 | 62,888 |
Goodwill |
| 71,478 | 71,478 |
Deferred tax assets, net of current | 512 | 449 |
Other assets | 1,434 | 1,096 |
|
| Total assets | $ 329,130 | $ 331,504 |
|
|
|
|
|
Liabilities and Stockholders' Equity |
|
|
Current liabilities: |
|
|
| Accounts payable | $ 13,110 | $ 16,083 |
| Other accrued expenses and other current liabilities | 6,698 | 8,680 |
| Deferred revenue | 10,657 | 12,944 |
| Notes payable | 1,012 | 1,012 |
| Capital lease and technology license obligations, current | 11,984 | 16,500 |
|
| Total current liabilities | 43,461 | 55,219 |
Notes payable, net of current portion | 4,500 | 4,000 |
Capital lease and technology license obligations, net of current | 23,843 | 24,832 |
Deferred tax liability | 2,617 | 2,421 |
Other non-current liabilities | 1,847 | 1,970 |
|
| Total liabilities | 76,268 | 88,442 |
|
|
|
|
|
Stockholders' equity |
|
|
| Common stock | 51 | 51 |
| Additional paid-in capital | 413,246 | 398,133 |
| Accumulated deficit | (157,276) | (154,092) |
|
| Total stockholders' equity attributable to the Company | 256,021 | 244,092 |
|
| Non-controlling interest | (3,159) | (1,030) |
|
| Total stockholders' equity | 252,862 | 243,062 |
|
| Total liabilities and stockholders' equity | $ 329,130 | $ 331,504 |
CONTACT: Art Chadwick, Vice President of Finance and Administration and Chief Financial Officer, (408) 943-7104, art.chadwick@cavium.com or Angel Atondo, Senior Marketing Communications, (408) 943-7417, angel.atondo@cavium.com
