Exhibit 99.1
PLX Technology, Inc. Reports Third-Quarter 2008 Financial Results
- PCI Express Year-to-Date Revenue up 65 Percent over Prior Year
- Company Commences Production Shipments of PCI Express Gen 2 Products
SUNNYVALE, Calif.--(BUSINESS WIRE)--October 27, 2008--PLX Technology, Inc. (NASDAQ:PLXT) today announced financial results for the third quarter and nine months ended September 30, 2008.
“In these difficult economic times, I am pleased that we were able to deliver solid financial results for the third quarter,” said Michael Salameh, PLX president and chief executive officer. “We reported GAAP net income of $798,000, or $0.03 per diluted share. With no debt and more than $44 million in cash and investments, our balance sheet remains strong.
“To date, we have shipped samples or development systems to more than 950 PCI Express customers, which includes over 100 customers using our Gen2 chips. Further enhancing our innovation in this market, we announced the industry’s first PCI Express switches with on-board DMA engines – also known as direct memory access.”
For the third quarter ended September 30, 2008, PLX reported net revenues of $20.8 million, a two percent decrease from the $21.2 million reported in the third quarter ended September 30, 2007, and an 11 percent decrease from the $23.4 million reported in the second quarter ended June 30, 2008.
GAAP net income for the third quarter ended September 30, 2008, was $798,000, or $0.03 per share (diluted). This compares with net income of $995,000, or $0.03 per share (diluted), in the third quarter ended September 30, 2007, and a net loss of $75,000, or a net loss of $0.00 per share (diluted), in the second quarter ended June 30, 2008.
The Company’s gross margin for the third quarter ended September 30, 2008, was 58.5 percent, as compared with 61.8 percent for the third quarter ended September 30, 2007, and 59.3 percent for the second quarter ended June 30, 2008.
GAAP operating expenses were $11.6 million for the third quarter ended September 30, 2008. This compares with $12.0 million reported in the third quarter of 2007 and $14.1 million in the second quarter of 2008. Included in GAAP operating expenses were stock-based compensation expense and acquisition-related amortization expense of $824,000 in the third quarter of 2008, $1.2 million in the third quarter of 2007 and $1.1 million in the second quarter of 2008.
The Company’s balance sheet remained strong. At September 30, 2008, cash and investments decreased by $2.6 million to $44.0 million, from $46.6 million at December 31, 2007, due to the repurchase of approximately 956,000 shares of PLX common stock for $6.5 million. Additionally, there continues to be no debt.
Business Outlook
The following statements are based on current expectations. The Company does not intend to update, confirm or change this guidance until its fourth-quarter earnings release, although it may provide additional details regarding its guidance during today’s scheduled conference call.
- Net revenues for the fourth quarter ended December 31, 2008, are expected to be between $15.0 million and $18.0 million, with approximately 50 percent of total net revenues attributable to PCI Express products.
- Gross margins are expected to be approximately 60 percent.
- Operating expenses under GAAP are expected to be approximately $12.4 million. Included in operating expenses are share-based compensation and acquisition related amortization which are expected to be approximately $0.9 million.
PLX management plans to conduct a conference call today at 2:00 p.m. PDT to discuss its third-quarter financial results, as well as its fourth-quarter outlook. A live Webcast of the conference call will be available through the Investor Relations section of the PLX Website at www.plxtech.com/investors, which also can be heard live via telephone at 913.312.0640. A recorded replay of this Webcast will be available on the PLX Website beginning 5:00 p.m. PDT on October 27, 2008, through 5:00 p.m. (PST) on November 3, 2008. To listen to the replay via telephone, call 719.457.0820 and use access code 1411614.
For the live Webcast, listeners should go to the PLX Web site at least 15 minutes before the event starts to download and install any necessary audio software. The archived Webcast is typically available one to two hours after the end of the live call.
About PLX
PLX Technology, Inc. (www.plxtech.com), based in Sunnyvale, Calif., USA, is the world’s leading supplier of PCI Express and other standard I/O interconnect semiconductors to the communications, server, storage, embedded-control, and consumer markets. The company provides a competitive advantage through an integrated combination of experience, high-performance silicon, hardware and software design tools, and global partnerships. These innovative solutions enable PLX customers to develop equipment with industry-leading performance, scalability and reliability that allows them to bring designs to market faster.
SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995
This release includes statements that qualify as forward-looking statements under the Private Securities Litigation Reform Act of 1995. These include statements about the Company’s estimated revenues, estimates of revenues attributable to certain products, estimated expenses, and estimated gross margins for the fourth quarter of 2008, which are set forth under the caption “Business Outlook,” statements regarding the PCI Express product lines and statements regarding the anticipated shipment date of the Gen 2 PCI Express products. Such statements involve risks and uncertainties, which may cause actual results to differ materially from those set forth in the statements. Factors that could cause actual results to differ materially include risks and uncertainties, such as reduced demand for products of electronic equipment manufacturers which include the Company’s products, adverse economic conditions in general or those specifically affecting the Company’s markets, reduced acceptance of the Company’s PCI Express products, technical difficulties and delays in the development process, errors in the products, reduced backlog for the Company’s customers and unexpected expenses. Please refer to the documents filed by the Company with the SEC from time to time, including, but not limited to, the Annual Report on Form 10-K for the year ended December 31, 2007 and PLX’s quarterly reports on Form 10-Q for the quarters ended March 31, 2008 and June 30, 2008, which identify important risk factors that could cause actual results to differ from those contained in the forward-looking statements. All forward-looking statements are made as of today, and the Company assumes no obligation to update such statements.
PLX and the PLX logo are trademarks of PLX Technology, Inc., which may be registered in some jurisdictions. All other product names that appear in this material are for identification purposes only and are acknowledged to be trademarks or registered trademarks of their respective companies.
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| PLX TECHNOLOGY, INC. |
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| CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS |
| (Unaudited) |
| (in thousands, except per share amounts) |
| | | | | | | | | | |
| | | | | | | | | | |
| | Three Months Ended | | Nine Months Ended |
| | September 30 | | September 30 | | June 30 | | September 30 |
| | 2008 | | 2007 | | 2008 | | 2008 | | 2007 |
| | | | | | | | | | |
| Net revenues | | $ | 20,790 | | | $ | 21,216 | | | $ | 23,350 | | | $ | 66,895 | | | $ | 59,620 | |
| Cost of revenues | | | 8,630 | | | | 8,108 | | | | 9,492 | | | | 27,034 | | | | 23,489 | |
| Gross margin | | | 12,160 | | | | 13,108 | | | | 13,858 | | | | 39,861 | | | | 36,131 | |
| | | | | | | | | | |
| Operating expenses: | | | | | | | | | | |
| Research and development | | | 6,000 | | | | 5,870 | | | | 7,791 | | | | 20,289 | | | | 17,755 | |
| Selling, general and administrative | | | 5,436 | | | | 5,912 | | | | 6,063 | | | | 17,952 | | | | 18,143 | |
| Amortization of purchased intangible assets | | | 150 | | | | 241 | | | | 202 | | | | 593 | | | | 1,038 | |
| Total operating expenses | | | 11,586 | | | | 12,023 | | | | 14,056 | | | | 38,834 | | | | 36,936 | |
| | | | | | | | | | |
| Income (loss) from operations | | | 574 | | | | 1,085 | | | | (198 | ) | | | 1,027 | | | | (805 | ) |
| Interest income and other, net | | | 336 | | | | 624 | | | | 376 | | | | 1,200 | | | | 1,805 | |
| | | | | | | | | | |
| Income (loss) before provision for income taxes | | | 910 | | | | 1,709 | | | | 178 | | | | 2,227 | | | | 1,000 | |
| Provision (benefit) for income taxes | | | 112 | | | | 712 | | | | 253 | | | | 442 | | | | 357 | |
| | | | | | | | | | |
| Net income (loss) | | $ | 798 | | | $ | 997 | | | $ | (75 | ) | | $ | 1,785 | | | $ | 643 | |
| | | | | | | | | | |
| Basic net income (loss) per share | | $ | 0.03 | | | $ | 0.03 | | | $ | (0.00 | ) | | $ | 0.06 | | | $ | 0.02 | |
| Shares used to compute basic per share amounts | | | 28,009 | | | | 28,748 | | | | 28,213 | | | | 28,270 | | | | 28,689 | |
| Diluted net income (loss) per share | | $ | 0.03 | | | $ | 0.03 | | | $ | (0.00 | ) | | $ | 0.06 | | | $ | 0.02 | |
| Shares used to compute diluted per share amounts | | | 28,122 | | | | 29,257 | | | | 28,213 | | | | 28,415 | | | | 29,148 | |
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| PLX TECHNOLOGY, INC. |
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| CONDENSED CONSOLIDATED BALANCE SHEETS |
| (in thousands) |
| | | | |
| | | | |
| | September 30 | | December 31 |
| | 2008 | | 2007 |
| | (unaudited) | | (unaudited) |
| ASSETS | | | | |
| | | | |
| Cash and investments | | $ | 44,015 | | | $ | 46,563 | |
| Accounts receivable, net | | | 9,804 | | | | 10,534 | |
| Inventories | | | 7,370 | | | | 7,422 | |
| Property and equipment, net | | | 29,753 | | | | 29,798 | |
| Goodwill | | | 34,692 | | | | 34,541 | |
| Other intangible assets | | | 984 | | | | 1,577 | |
| Other assets | | | 6,927 | | | | 5,365 | |
| Total assets | | $ | 133,545 | | | $ | 135,800 | |
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| LIABILITIES | | | | |
| | | | |
| Accounts payable | | $ | 3,545 | | | $ | 4,447 | |
| Accrued compensation and benefits | | | 2,366 | | | | 2,237 | |
| Accrued commissions | | | 483 | | | | 652 | |
| Other accrued expenses | | | 791 | | | | 572 | |
| Total liabilities | | | 7,185 | | | | 7,908 | |
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| STOCKHOLDERS' EQUITY | | | | |
| | | | |
| Common stock, par value | | | 28 | | | | 29 | |
| Additional paid-in capital | | | 131,392 | | | | 134,503 | |
| Accumulated other comprehensive loss | | | (287 | ) | | | (82 | ) |
| Accumulated deficit | | | (4,773 | ) | | | (6,558 | ) |
| Total stockholders' equity | | | 126,360 | | | | 127,892 | |
| Total liabilities and stockholders' equity | | $ | 133,545 | | | $ | 135,800 | |
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| PLX TECHNOLOGY, INC. |
| SUPPLEMENTAL DATA |
| (Unaudited) |
| | | | | | | | | | |
| | | | | | | | | | |
| | | | | | | | | | |
| | Three Months Ended | | Nine Months Ended |
| | September 30 | | September 30 | | June 30 | | September 30 |
| | 2008 | | 2007 | | 2008 | | 2008 | | 2007 |
| Net Revenues by Geography | | | | | | | | | | |
| Americas | | | 32 | % | | | 28 | % | | | 35 | % | | | 32 | % | | | 30 | % |
| Asia Pacific | | | 53 | % | | | 60 | % | | | 54 | % | | | 55 | % | | | 59 | % |
| Europe | | | 15 | % | | | 11 | % | | | 11 | % | | | 13 | % | | | 11 | % |
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| | Share-Based Compensation |
| | (in thousands) |
| | | | | | | | | | |
| | Three Months Ended | | Nine Months Ended |
| | September 30 | | September 30 | | June 30 | | September 30 |
| | 2008 | | 2007 | | 2008 | | 2008 | | 2007 |
| Manufacturing | | $ | 14 | | | $ | 12 | | | $ | 15 | | | $ | 47 | | | $ | 43 | |
| Research and development | | | 273 | | | | 377 | | | | 351 | | | | 1,027 | | | | 1,331 | |
| Selling, general and administrative | | | 400 | | | | 622 | | | | 595 | | | | 1,459 | | | | 2,001 | |
| | $ | 687 | | | $ | 1,011 | | | $ | 961 | | | $ | 2,533 | | | $ | 3,375 | |
CONTACT:
CommonGround Communications (for PLX)
Jerry Steach, 415-222-9996
jsteach@plxtech.com
or
PLX Technology, Inc.
Arthur O. Whipple, CFO, 408-774-9060
investor-relations@plxtech.com
