Exhibit 99.1
ShoreTel Reports Financial Results for Fourth Quarter and Fiscal Year 2012
Addition of Cloud Business Helps Drive 39 Percent Sequential Growth in Seasonally Strong Quarter
SUNNYVALE, Calif.--(BUSINESS WIRE)--August 14, 2012--ShoreTel® (NASDAQ:SHOR), the leading provider of brilliantly simple phone and Unified Communication (UC) systems for both premise and cloud-based solutions, today announced financial results for its fiscal fourth quarter and fiscal year 2012.
For the fourth quarter of fiscal 2012, consolidated revenue was $78.5 million, an increase of 39 percent sequentially over the third quarter of fiscal 2012 and an increase of 39 percent from the fourth quarter of fiscal 2011. Fourth quarter revenue includes a full quarter of revenue from the Cloud division, formerly M5 Networks, which was acquired on March 23, 2012. The non-GAAP net loss for the fourth quarter of fiscal year 2012 was $(0.2) million, or $(0.00) per share which excludes stock-based compensation charges, amortization of acquisition-related intangibles, other charges and related tax adjustments. This compares with non-GAAP net income of $1.3 million, or $0.03 per share, in the fourth quarter of fiscal 2011.
For the 2012 fiscal year, consolidated revenue was an all-time record of $246.6 million, up 23 percent from fiscal year 2011. The non-GAAP net loss for fiscal year 2012 was $(1.4) million, or $(0.03) per share, which excludes stock-based compensation charges, amortization of acquisition-related intangibles, litigation settlement costs, other charges and related tax adjustments. This compares with non-GAAP net income of $0.7 million, or $0.01 per share, in fiscal 2011.
“This year we took an important step to position ShoreTel for long-term market leadership through the acquisition of the unified communications cloud pioneer M5 Networks. With this addition, ShoreTel can offer customers a full range of premise, cloud or hybrid solutions,” said Peter Blackmore, president and CEO of ShoreTel. “Despite economic headwinds, ShoreTel once again improved our market share in the March quarter, growing from 6.5 percent to 7.7 percent in the United States Enterprise IP Telephony market, according to Synergy Research, further extending our position as the third largest vendor in the United States.”
Blackmore added, “Our premise business is strong and continues to grow. We were pleased to deliver a solid operating profit in this part of our business in the fourth quarter and for our fiscal year. With growth in fourth quarter cloud bookings of over 40 percent year-over-year, we are convinced that it is the right time to press for a market leadership position. We plan to make appropriate investments in our cloud infrastructure to support the strong bookings growth we expect as we move forward into fiscal 2013.”
Fourth Quarter 2012 Financial Highlights
GAAP gross margin for the fourth quarter of fiscal year 2012 was 60.9 percent, compared with 65.6 percent in the fourth quarter of fiscal year 2011. The year-over-year decline was the result of the inclusion of a full quarter of the Cloud division, which has lower gross margins.
Non-GAAP gross margin for the fourth quarter of fiscal year 2012, which excludes stock-based compensation charges, amortization of acquisition-related intangibles, and related tax adjustments, was 62.6 percent, compared with 66.3 percent in the year-ago quarter.
GAAP net loss was $(5.0) million, or $(0.09) per share, in the fourth quarter of 2012, compared with a GAAP net loss of $(1.7) million, or $(0.04) per share, in the fourth quarter of fiscal 2011.
As of June 30, 2012, the company had $55.5 million in cash, cash equivalents and short-term investments after paying down its line of credit by $5.0 million during the quarter. For fiscal year 2012, the company generated over $10.0 million in cash flow from operations.
Fiscal Year 2012 Financial Highlights
GAAP gross margin for the 2012 fiscal year was 64.3 percent, compared with 66.7 percent for the 2011 fiscal year.
Non-GAAP gross margin, which excludes stock-based compensation charges, amortization of acquisition-related intangibles, and related tax adjustments, was 65.4 percent for the 2012 fiscal year, compared with 67.3 percent for the 2011 fiscal year.
Non-GAAP operating income for fiscal year 2012 was $0.2 million, compared with $0.1 million for the 2011 fiscal year.
GAAP net loss for fiscal 2012 was $(20.7) million, or $(0.41) per share, which included non-cash stock-based compensation charges of $12.6 million, acquisition related deal costs of $4.5 million, amortization of acquisition-related intangibles of $2.8 million as well as other charges, and compared to a GAAP net loss of $(11.5) million, or $(0.25) per share, in fiscal 2011.
Line of Business Results
Premise
The company’s premise business was strong in the fourth quarter of fiscal 2012, delivering 17 percent sequential revenue growth from the third fiscal quarter. Non-GAAP gross margins in the premise business were 67.1 percent in the fourth quarter of fiscal 2012, up from 66.3 percent in the fourth quarter of fiscal 2011. Revenue from the company’s international sites represented 13 percent of its premise business in the fourth quarter of fiscal 2012, and increased 20 percent over the year-ago quarter. Additionally, according to Synergy Research, the company’s share of the United States Enterprise IP Telephony market increased from 6.5 percent in the December quarter of 2011 to 7.7 percent in the March quarter of 2012.
Cloud
The cloud segment represents a rapidly growing portion of the VoIP market. Industry forecasts show cloud solutions will grow at more than a 30 percent compound annual growth rate. Today cloud solutions represent six percent of the market and are expected to reach between 15 and 20 percent of the market by 2016. Based on strong bookings, the company plans to make incremental investments in its cloud business infrastructure and operations to capitalize on the expected segment growth.
Select Operational Metrics
Three Months Ended | |||
| Cloud Monthly Average Revenue Per User (ARPU) | $ | 62 | |
| Cloud Average # of Seats per Subscriber | 34 | ||
| Cloud Monthly Revenue Churn Rate | 0.3% | ||
| Total Company Headcount | 933 | ||
| Non-GAAP Gross Margins-Premise | 67.1% | ||
| Non-GAAP Gross Margins-Cloud | 42.2% | ||
Business Highlights
Partnership with Polycom and HP to Provide Bundled Solutions
In May, the company announced that it is providing a promotional incentive for bundled offerings that include ShoreTel, Polycom and HP solutions, which allow implementation of complete UC solutions on a secure, resilient and flexible network infrastructure. The combination of ShoreTel, Polycom and HP allows organizations to simplify design and management, deliver a consistent user experience (including video, voice, instant messaging (IM) and presence), and increase reliability and resiliency with uninterrupted availability.
Introduction of ShoreTel 13
The company recently announced the global availability of ShoreTel 13, its latest software release, which includes enhanced capabilities for video communications and IM for overall employee productivity.
New Head of World-wide Sales
In July, the company announced it hired David Petts as senior vice president of worldwide sales reporting directly to ShoreTel CEO Peter Blackmore. The recently announced new sales leadership team which includes Joe Vitalone in channel management, Tim Gaines as head of North America sales, and Mark Arman as head of international sales and worldwide distribution, report to Petts.
Mobility Solution for Cloud Customers
In June, the company released ShoreTel Mobility for customers of ShoreTel’s Cloud division. The solution further extends the popular voice and UC applications to the smartphone. The initial launch supports iPhones and subsequent releases over the summer will add support for other smartphone and tablet devices, including Android and Blackberry.
Business Outlook
ShoreTel is providing the following outlook for the quarter ending Sept. 30, 2012:
- Revenue is expected to be in the range of $69.0 million to $75.0 million.
- GAAP gross margin is expected to be in the range of 60 percent to 61 percent, including approximately $1.4 million in stock-based compensation charges and amortization of acquisition-related intangibles. Non-GAAP gross margin, which excludes stock-based compensation and other charges, is expected to be in the range of 62 percent to 63 percent.
- GAAP operating expenses are expected to be in the range of $51.5 million to $52.5 million, including approximately $4.0 million in stock-based compensation charges and amortization of acquisition-related intangibles. Non-GAAP operating expenses, which exclude stock-based compensation and other charges, are expected to be in the range of $47.5 million to $48.5 million.
Conference Call Information
The company will host a corresponding conference call and live webcast today at 2:00 p.m. Pacific Daylight Time. To access the conference call, dial +1-888-401-4689 for callers in the U.S. or Canada and +1-719-325-2310 for international callers and provide the operator with the conference identification number of 6334894. A live webcast will be available in the Investor Relations section of the company's corporate web site at www.shoretel.com and an archived recording will be available beginning approximately two hours after the completion of the call until the company's announcement of its financial results for the next quarter. An audio telephonic replay of the conference call will also be available beginning at approximately 4:00 p.m. Pacific Daylight Time today until approximately 4:00 p.m. Pacific Daylight Time on August 21, 2012 by dialing +1-888-203-1112 or +1-719-457-0820 for callers outside the U.S. and Canada and providing the conference identification number of 6334894.
Use of Non-GAAP Financial Measures
ShoreTel reports all required financial information in accordance with generally accepted accounting principles in the United States (“GAAP”), but it believes that evaluating its ongoing operating results may be difficult to understand if limited to reviewing only GAAP financial measures. Many investors have requested that ShoreTel disclose this non-GAAP information because it is useful in understanding the company’s performance as it excludes non-cash charges, other non-recurring adjustments and related tax adjustments, that many investors feel may obscure the company’s true operating performance. Likewise, management uses these non-GAAP measures to manage and assess the profitability of its business and does not consider stock-based compensation charges and amortization charges related to acquisition-related intangible assets, which are non-cash charges, or other non-recurring items in managing its core operations. ShoreTel has provided a reconciliation of non-GAAP financial measures following the text of this press release. Investors are encouraged to review the related GAAP financial measures and the reconciliation of these non-GAAP financial measures to their most directly comparable GAAP financial measure.
Legal Notice Regarding Forward-Looking Statements
ShoreTel assumes no obligation to update the forward-looking statements included in this release. This release contains forward-looking statements within the meaning of the “safe harbor” provisions of the federal securities laws, including, without limitation, statements by Peter Blackmore, statements regarding future products and statements in the “Business Outlook” section regarding ShoreTel’s anticipated future revenues, gross margins, operating expenses and other financial information. The forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected. The risks and uncertainties include global economic uncertainty, the pace of economic recovery in the U.S., and the impact thereof on information technology spending, the intense competition in our industry, our reliance on third parties to sell and support our products, supply and manufacturing risks, our ability to control costs as we expand our business, increased risk of intellectual property litigation by entering into new markets, our ability to attract, retain and ramp new sales personnel, uncertainties inherent in the product development cycle, uncertainty as to market acceptance of new products and services, the potential for litigation in our industry, risks related to our recently-completed acquisition of M5 Networks, including technology and product integration risks, ability to retain key personnel and customers and the risk of assuming unknown liabilities, and other risk factors set forth in ShoreTel’s Form 10-K for the year ended June 30, 2011, and in its Form 10-Q for the quarter ended March 31, 2012.
About ShoreTel, Inc.
ShoreTel, Inc. (NASDAQ: SHOR) brings unmatched flexibility, choice and value to brilliantly simple business phones systems and unified communications (UC). With its award-winning premise-based IP phone system with integrated unified communications, contact center capabilities, and its proven hosted VoIP services, organizations of all sizes can select the best option for their needs. ShoreTel’s ongoing mission is to eliminate costly complexity and give customers the 24/7 freedom to leverage rich voice, video, data and mobile unified communications capabilities they need. ShoreTel is based in Sunnyvale, California, and has regional offices in Austin, Texas; Rochester and New York, N.Y.; Chicago, Ill.; Maidenhead, United Kingdom; Sydney, Australia; and Singapore. For more information, visit www.shoretel.com.
| SHORETEL, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (Amounts in thousands) (Unaudited) | ||||||||||||
| As of June 30, 2012 | As of March 31, 2012 | As of June 30, 2011 | ||||||||||
| ASSETS | ||||||||||||
| Current assets: | ||||||||||||
| Cash and cash equivalents | $ | 37,120 | $ | 40,328 | $ | 89,695 | ||||||
| Short-term investments | 18,375 | 20,994 | 16,057 | |||||||||
| Accounts receivable - net | 34,198 | 32,746 | 33,812 | |||||||||
| Inventories | 20,212 | 23,176 | 19,062 | |||||||||
| Prepaid expenses and other current assets | 5,275 | 5,807 | 3,540 | |||||||||
| Total current assets | 115,180 | 123,051 | 162,166 | |||||||||
| Property and equipment - net | 12,811 | 12,578 | 8,236 | |||||||||
| Goodwill | 120,212 | 119,273 | 7,415 | |||||||||
| Intangible assets | 45,304 | 47,651 | 8,570 | |||||||||
| Other assets | 1,925 | 1,240 | 714 | |||||||||
| Total assets | $ | 295,432 | $ | 303,793 | $ | 187,101 | ||||||
| LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||||||
| Current liabilities: | ||||||||||||
| Accounts payable | $ | 9,747 | $ | 11,289 | $ | 6,394 | ||||||
| Accrued liabilities and other | 17,094 | 19,976 | 8,533 | |||||||||
| Accrued employee compensation | 12,151 | 9,379 | 11,022 | |||||||||
| Contingent consideration | 9,398 | 9,132 | - | |||||||||
| Deferred revenue | 35,829 | 36,509 | 26,362 | |||||||||
| Total current liabilities | 84,219 | 86,285 | 52,311 | |||||||||
| Line of credit - net | 19,946 | 24,947 | - | |||||||||
| Long-term deferred revenue | 13,683 | 12,962 | 11,321 | |||||||||
| Long-term contingent consideration | 3,305 | 3,368 | - | |||||||||
| Other long-term liabilities | 4,047 | 4,998 | 2,045 | |||||||||
| Total liabilities | 125,200 | 132,560 | 65,677 | |||||||||
| Stockholders' equity: | ||||||||||||
| Common stock | 310,648 | 306,604 | 241,103 | |||||||||
| Accumulated deficit | (140,416 | ) | (135,371 | ) | (119,679 | ) | ||||||
| Total stockholders' equity | 170,232 | 171,233 | 121,424 | |||||||||
| Total liabilities and stockholders' equity | $ | 295,432 | $ | 303,793 | $ | 187,101 | ||||||
| SHORETEL, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Amounts in thousands, except per share amounts) (Unaudited) | ||||||||||||||||
| Three Months Ended June 30, | Twelve Months Ended June 30, | |||||||||||||||
| 2012 | 2011 | 2012 | 2011 | |||||||||||||
| Revenue: | ||||||||||||||||
| Product | $ | 51,108 | $ | 45,306 | $ | 182,009 | $ | 159,693 | ||||||||
| Hosted and related services | 14,253 | - | 15,547 | - | ||||||||||||
| Support and services | 13,097 | 11,221 | 49,076 | 40,419 | ||||||||||||
| Total revenues | 78,458 | 56,527 | 246,632 | 200,112 | ||||||||||||
| Cost of revenue: | ||||||||||||||||
| Product | 17,166 | 15,364 | 61,884 | 52,957 | ||||||||||||
| Hosted and related services | 9,024 | - | 9,804 | - | ||||||||||||
| Support and services | 4,477 | 4,072 | 16,465 | 13,688 | ||||||||||||
| Total cost of revenue | 30,667 | 19,436 | 88,153 | 66,645 | ||||||||||||
| Gross profit | 47,791 | 37,091 | 158,479 | 133,467 | ||||||||||||
| Gross profit % | 60.9 | % | 65.6 | % | 64.3 | % | 66.7 | % | ||||||||
| Operating expenses: | ||||||||||||||||
| Research and development | 14,719 | 12,152 | 51,909 | 45,548 | ||||||||||||
| Sales and marketing | 29,413 | 20,422 | 94,797 | 74,859 | ||||||||||||
| General and administrative | 7,949 | 6,112 | 27,468 | 24,890 | ||||||||||||
| Acquisition-related costs | 36 | - | 4,524 | 340 | ||||||||||||
| Total operating expenses | 52,117 | 38,686 | 178,698 | 145,637 | ||||||||||||
| Loss from operations | (4,326 | ) | (1,595 | ) | (20,219 | ) | (12,170 | ) | ||||||||
| Other income (expense) - net | (866 | ) | (140 | ) | (1,465 | ) | 640 | |||||||||
| Loss before provision for income tax | (5,192 | ) | (1,735 | ) | (21,684 | ) | (11,530 | ) | ||||||||
| Provision for (benefit from) income tax | (147 | ) | 10 | (947 | ) | (67 | ) | |||||||||
| Net loss | $ | (5,045 | ) | $ | (1,745 | ) | $ | (20,737 | ) | $ | (11,463 | ) | ||||
| Net loss per share: | ||||||||||||||||
| Basic | $ | (0.09 | ) | $ | (0.04 | ) | $ | (0.41 | ) | $ | (0.25 | ) | ||||
| Diluted | $ | (0.09 | ) | $ | (0.04 | ) | $ | (0.41 | ) | $ | (0.25 | ) | ||||
| Shares used in computing net loss per share: | ||||||||||||||||
| Basic | 57,932 | 47,126 | 50,591 | 46,177 | ||||||||||||
| Diluted | 57,932 | 47,126 | 50,591 | 46,177 | ||||||||||||
| SHORETEL, INC. GAAP to Non-GAAP Reconciliation (Amounts in thousands, except per share amounts) (Unaudited) | |||||||||||||||||||||||||
| Three Months Ended June 30, 2012 | Twelve Months Ended June 30, 2012 | ||||||||||||||||||||||||
| GAAP | Excludes | Non-GAAP | GAAP | Excludes | Non-GAAP | ||||||||||||||||||||
| Revenue: | |||||||||||||||||||||||||
| Product | $ | 51,108 | $ | - | $ | 51,108 | $ | 182,009 | $ | - | $ | 182,009 | |||||||||||||
| Hosted and related services | 14,253 | - | 14,253 | 15,547 | - | 15,547 | |||||||||||||||||||
| Support and services | 13,097 | - | 13,097 | 49,076 | - | 49,076 | |||||||||||||||||||
| Total revenues | 78,458 | - | 78,458 | 246,632 | - | 246,632 | |||||||||||||||||||
| Cost of revenue: | |||||||||||||||||||||||||
| Product | 17,166 | (286 | ) | (a),(b) | 16,880 | 61,884 | (1,022 | ) | (a),(b) | 60,862 | |||||||||||||||
| Hosted and related services | 9,024 | (786 | ) | (a),(b) | 8,238 | 9,804 | (850 | ) | (a),(b) | 8,954 | |||||||||||||||
| Support and services | 4,477 | (218 | ) | (a) | 4,259 | 16,465 | (836 | ) | (a) | 15,629 | |||||||||||||||
| Total cost of revenue | 30,667 | (1,290 | ) | 29,377 | 88,153 | (2,708 | ) | 85,445 | |||||||||||||||||
| Gross profit | 47,791 | 1,290 | 49,081 | 158,479 | 2,708 | 161,187 | |||||||||||||||||||
| Gross profit % | 60.9 | % | 62.6 | % | 64.3 | % | 65.4 | % | |||||||||||||||||
| Operating expenses: | |||||||||||||||||||||||||
| Research and development | 14,719 | (790 | ) | (a) | 13,929 | 51,909 | (3,614 | ) | (a) | 48,295 | |||||||||||||||
| Sales and marketing | 29,413 | (1,776 | ) | (a),(b) | 27,637 | 94,797 | (5,043 | ) | (a),(b) | 89,754 | |||||||||||||||
| General and administrative | 7,949 | (1,003 | ) | (a),(b),(c) | 6,946 | 27,468 | (4,534 | ) | (a),(b),(c) | 22,934 | |||||||||||||||
| Acquisition-related costs | 36 | (36 | ) | (d) | - | 4,524 | (4,524 | ) | (d) | - | |||||||||||||||
| Total operating expenses | 52,117 | (3,605 | ) | 48,512 | 178,698 | (17,715 | ) | 160,983 | |||||||||||||||||
| Income (loss) from operations | (4,326 | ) | 4,895 | 569 | (20,219 | ) | 20,423 | 204 | |||||||||||||||||
| Other income (expense) - net | (866 | ) | 203 | (e) | (663 | ) | (1,465 | ) | 203 | (e) | (1,262 | ) | |||||||||||||
| Income (loss) before provision for income tax | (5,192 | ) | 5,098 | (94 | ) | (21,684 | ) | 20,626 | (1,058 | ) | |||||||||||||||
| Provision for (benefit from) income tax | (147 | ) | 263 | (f) | 116 | (947 | ) | 1,315 | (f) | 368 | |||||||||||||||
| Net income (loss) | $ | (5,045 | ) | $ | 4,835 | $ | (210 | ) | $ | (20,737 | ) | $ | 19,311 | $ | (1,426 | ) | |||||||||
| Net income (loss) per share: | |||||||||||||||||||||||||
| Basic | $ | (0.09 | ) | $ | 0.09 | $ | (0.00 | ) | $ | (0.41 | ) | $ | 0.38 | $ | (0.03 | ) | |||||||||
| Diluted (g) | $ | (0.09 | ) | $ | 0.09 | $ | (0.00 | ) | $ | (0.41 | ) | $ | 0.38 | $ | (0.03 | ) | |||||||||
| Shares used in computing net income (loss) per share: | |||||||||||||||||||||||||
| Basic | 57,932 | 57,932 | 50,591 | 50,591 | |||||||||||||||||||||
| Diluted (g) | 57,932 | 57,932 | 50,591 | 50,591 | |||||||||||||||||||||
| (a) | Excludes stock-based compensation included in: | ||||||||||||||||||||||||
| Cost of product revenue | $ | 26 | $ | 132 | |||||||||||||||||||||
| Cost of hosted and related services | 37 | 37 | |||||||||||||||||||||||
| Cost of support and services revenue | 218 | 836 | |||||||||||||||||||||||
| Research and development | 790 | 3,614 | |||||||||||||||||||||||
| Sales and marketing | 925 | 4,031 | |||||||||||||||||||||||
| General and administrative | 965 | 3,993 | |||||||||||||||||||||||
| $ | 2,961 | $ | 12,643 | ||||||||||||||||||||||
| (b) | Excludes amortization of acquisition-related intangibles included in: | ||||||||||||||||||||||||
| Cost of product revenue | $ | 260 | $ | 890 | |||||||||||||||||||||
| Cost of hosted and related services | 749 | 813 | |||||||||||||||||||||||
| Sales and marketing | 851 | 1,012 | |||||||||||||||||||||||
| General and administrative | 38 | 41 | |||||||||||||||||||||||
| $ | 1,898 | $ | 2,756 | ||||||||||||||||||||||
| (c) | Excludes litigation settlement included in: | ||||||||||||||||||||||||
| General and administrative | $ | - | $ | 500 | |||||||||||||||||||||
| (d) | Excludes direct acquisition costs included in: | ||||||||||||||||||||||||
| Acquisition-related costs | $ | 36 | $ | 4,524 | |||||||||||||||||||||
| (e) | Excludes interest charge from change in fair value of contingent consideration included in: | ||||||||||||||||||||||||
| Other expense | $ | 203 | $ | 203 | |||||||||||||||||||||
| (f) | Excludes the deferred tax benefit arising from acquisition and tax impact of the items which are excluded in (a) to (e) above. | ||||||||||||||||||||||||
(g) | Potentially dilutive securities were not included in the calculation of diluted net loss per share for the periods which had a net loss because to do so would have been anti-dilutive. | ||||||||||||||||||||||||
| |||||||||||||||||||||||||
| SHORETEL, INC. GAAP to Non-GAAP Reconciliation (Amounts in thousands, except per share amounts) (Unaudited) | |||||||||||||||||||||||||
| Three Months Ended June 30, 2011 | Twelve Months Ended June 30, 2011 | ||||||||||||||||||||||||
| GAAP | Excludes | Non-GAAP | GAAP | Excludes | Non-GAAP | ||||||||||||||||||||
| Revenue: | |||||||||||||||||||||||||
| Product | $ | 45,306 | $ | - | $ | 45,306 | $ | 159,693 | $ | - | $ | 159,693 | |||||||||||||
| Support and services | 11,221 | - | 11,221 | 40,419 | - | 40,419 | |||||||||||||||||||
| Total revenues | 56,527 | - | 56,527 | 200,112 | - | 200,112 | |||||||||||||||||||
| Cost of revenue: | |||||||||||||||||||||||||
| Product | 15,364 | (204 | ) | (a),(c) | 15,160 | 52,957 | (614 | ) | (a),(c) | 52,343 | |||||||||||||||
| Support and services | 4,072 | (206 | ) | (a) | 3,866 | 13,688 | (678 | ) | (a) | 13,010 | |||||||||||||||
| Total cost of revenue | 19,436 | (410 | ) | 19,026 | 66,645 | (1,292 | ) | 65,353 | |||||||||||||||||
| Gross profit | 37,091 | 410 | 37,501 | 133,467 | 1,292 | 134,759 | |||||||||||||||||||
| Gross profit % | 65.6 | % | 66.3 | % | 66.7 | % | 67.3 | % | |||||||||||||||||
| Operating expenses: | |||||||||||||||||||||||||
| Research and development | 12,152 | (809 | ) | (a) | 11,343 | 45,548 | (3,497 | ) | (a) | 42,051 | |||||||||||||||
| Sales and marketing | 20,422 | (939 | ) | (a),(c) | 19,483 | 74,859 | (3,170 | ) | (a),(c) | 71,689 | |||||||||||||||
| General and administrative | 6,112 | (955 | ) | (a) | 5,157 | 24,890 | (4,266 | ) | (a),(b) | 20,624 | |||||||||||||||
| Acquisition-related costs | - | - | - | 340 | - | 340 | |||||||||||||||||||
| Total operating expenses | 38,686 | (2,703 | ) | 35,983 | 145,637 | (10,933 | ) | 134,704 | |||||||||||||||||
| Income (loss) from operations | (1,595 | ) | 3,113 | 1,518 | (12,170 | ) | 12,225 | 55 | |||||||||||||||||
| Other income (expense) - net | (140 | ) | - | (140 | ) | 640 | - | 640 | |||||||||||||||||
| Income (loss) before provision for income tax | (1,735 | ) | 3,113 | 1,378 | (11,530 | ) | 12,225 | 695 | |||||||||||||||||
| Provision for (benefit from) income tax | 10 | 80 | (d) | 90 | (67 | ) | 81 | (d) | 14 | ||||||||||||||||
| Net income (loss) | $ | (1,745 | ) | $ | 3,033 | $ | 1,288 | $ | (11,463 | ) | $ | 12,144 | $ | 681 | |||||||||||
| Net income (loss) per share: | |||||||||||||||||||||||||
| Basic | $ | (0.04 | ) | $ | 0.07 | $ | 0.03 | $ | (0.25 | ) | $ | 0.26 | $ | 0.01 | |||||||||||
| Diluted (e) | $ | (0.04 | ) | $ | 0.07 | $ | 0.03 | $ | (0.25 | ) | $ | 0.26 | $ | 0.01 | |||||||||||
| Shares used in computing net income (loss) per share: | |||||||||||||||||||||||||
| Basic | 47,126 | 47,126 | 46,177 | 46,177 | |||||||||||||||||||||
| Diluted (e) | 47,126 | 49,446 | 46,177 | 47,900 | |||||||||||||||||||||
| (a) | Excludes stock-based compensation included in: | ||||||||||||||||||||||||
| Cost of product revenue | $ | 29 | $ | 123 | |||||||||||||||||||||
| Cost of support and services revenue | 206 | 678 | |||||||||||||||||||||||
| Research and development | 809 | 3,497 | |||||||||||||||||||||||
| Sales and marketing | 928 | 3,140 | |||||||||||||||||||||||
| General and administrative | 955 | 3,741 | |||||||||||||||||||||||
| $ | 2,927 | $ | 11,179 | ||||||||||||||||||||||
| (b) | Excludes severance for former Chief Executive Officer included in: | ||||||||||||||||||||||||
| General and administration | $ | - | $ | 525 | |||||||||||||||||||||
| (c) | Excludes amortization of acquisition-related intangibles included in: | ||||||||||||||||||||||||
| Cost of product revenue | $ | 175 | $ | 491 | |||||||||||||||||||||
| Sales and marketing | 11 | 30 | |||||||||||||||||||||||
| $ | 186 | $ | 521 | ||||||||||||||||||||||
| (d) | Excludes the tax impact of the items which are excluded in (a) to (c) above. | ||||||||||||||||||||||||
(e) | Potentially dilutive securities were not included in the calculation of diluted net loss per share for the periods which had a net loss because to do so would have been anti-dilutive. | ||||||||||||||||||||||||
| |||||||||||||||||||||||||
| SHORETEL, INC. RECONCILIATION OF GAAP TO NON-GAAP FOR Q1 PROJECTIONS (Amounts in thousands) (Unaudited) | ||||||||
| Three Months Ending September 30, 2012 | ||||||||
High | Low | |||||||
| GAAP gross profit % | 61.0 | % | 60.0 | % | ||||
| Adjustments for stock-based compensation and acquisition-related intangible asset amortization | 2.0 | % | 2.0 | % | ||||
| Non-GAAP gross profit % | 63.0 | % | 62.0 | % | ||||
| Total GAAP operating expenses | $ | 52,500 | $ | 51,500 | ||||
| Adjustments for stock-based compensation and acquisition-related intangible asset amortization | (4,000 | ) | (4,000 | ) | ||||
| Total non-GAAP operating expenses | $ | 48,500 | $ | 47,500 | �� | |||
CONTACT:
ShoreTel, Inc.
Tonya Chin, 408-962-2573
tchin@shoretel.com