Exhibit 99.1
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| AT THE COMPANY: | | IR INQUIRIES: |
| Suzanne Runald | | Todd Kehrli or Jim Byers |
Public Relations 949-362-5800 pr@smithmicro.com | | MKR Group 323-468-2300 smsi@mkr-group.com |
Smith Micro Software Achieves First Quarter Revenue Growth of 25% Year over Year
and Non-GAAP Profitability
Company Reiterates Fiscal 2015 Guidance
Aliso Viejo, CA, April 28, 2015 –Smith Micro Software, Inc. (NASDAQ:SMSI), a leading provider of wireless and mobility solutions, today reported financial results for its first quarter ended March 31, 2015.
“Revenue for the first quarter of 2015 was $10.5 million, up 24.6 percent compared to the first quarter of last year, and essentially flat compared to the fourth quarter of 2014 which is a significant accomplishment considering the historic seasonality of our business,” saidWilliam W. Smith Jr., President and CEO of Smith Micro Software. “The increase in revenues year-over-year was primarily due to new NetWise business at Comcast, our first MSO customer, and continued strong revenues for both NetWise and CommSuite products at Sprint. GAAP net income was essentially breakeven for the quarter and we were non-GAAP net income positive for the second consecutive quarter.”
“We continue to enhance our product portfolio, work on closing additional new deals that will bring us a predictable base of business, and keep our expenses under control. As such, we are reiterating our previously announced guidance for fiscal 2015 of revenue between $45 and $49 million, which would represent year-over-year growth in the range of 22 to 33 percent, and expect to be non-GAAP profitable for the year,” Mr. Smith concluded.
Fiscal First Quarter 2015 Financial Results:
Smith Micro Software reported revenue of $10.5 million for the first quarter ended March 31, 2015, compared to $8.4 million reported in the first quarter of 2014.
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| Smith Micro Software First Quarter 2015 Financial Results | | Page 2 of 6 |
First quarter gross profit on a GAAP and non-GAAP (which excludes stock compensation) basis was $8.4 million, compared to $6.0 million reported in the first quarter of 2014.
GAAP and non-GAAP gross profit as a percentage of revenue was 79.9 percent for the first quarter of 2015, compared to 71.4 percent for the same quarter last year.
GAAP net loss for the first quarter of 2015 was $10,000 or a loss of $0.00 per share, compared to GAAP net loss of $5.2 million, or $0.14 per share, for the first quarter of 2014.
Non-GAAP net income (which excludes stock compensation and non-cash tax expense) for the first quarter of 2015 was $0.4 million, or $0.01 earnings per diluted share, compared to a net loss of $2.7 million, or $0.07 loss per diluted share, for the first quarter of 2014.
Total cash and cash equivalents and short-term investments increased for the third consecutive quarter ending March 31, 2015 at $13.8 million.
Fully diluted weighted average common shares outstanding as of March 31, 2015 were 45.5 million, compared to 37.7 million fully diluted weighted average common shares outstanding as of March 31, 2014.
Fiscal 2015 Guidance:
| | • | | Revenue for fiscal 2015 is expected to be between $45 million and $49 million, which would represent year-over-year growth in the range of 22 to 33 percent. |
| | • | | The Company expects to be non-GAAP profitable for the fiscal year 2015. |
The Company uses a non-GAAP reconciliation of gross profit, profit (loss) before taxes, net income (loss) and earnings (loss) per share in the presentation of financial results in this press release. Management believes that this presentation may be more meaningful in analyzing our income generation since stock-based compensation is excluded from the non-GAAP earnings calculation and adjustments are made for Proforma taxes. Since we are in a cumulative loss position, the non-GAAP income tax expense (benefit) for the period ended March 31, 2015 was computed by using a tax rate of 38 percent using the Company’s normalized combined U.S. federal, state and foreign statutory tax rates less various tax adjustments. This presentation may be considered more indicative of our ongoing operational performance. The tables below present the differences between non-GAAP earnings and net income (loss) on an absolute and per-
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| Smith Micro Software First Quarter 2015 Financial Results | | Page 3 of 6 |
share basis. Non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information presented in compliance with GAAP, and the non-financial measures as reported by Smith Micro Software may not be comparable to similarly titled amounts reported by other companies.
Investor Conference Call:
Smith Micro Software will hold an investor conference call today to discuss the Company’s first quarter 2015 results at 4:30 p.m. ET, April 28, 2015. To access the call, dial (888) 539-3678 and when prompted provide the participant pass code 7522177. Participants are asked to call the assigned number approximately 10 minutes before the conference call begins. In addition, the conference call will be available on the Smith Micro website in theInvestor Relations section.
About Smith Micro Software, Inc.:
Smith Micro provides software to simplify and enhance the mobile experience. As the leader in wireless connectivity, our applications ensure the best Quality of Experience for mobile users while optimizing networks for service providers and enterprises. Using our intelligent policy-on-device platform, along with premium voice, video and content monetization services, we create new opportunities to engage consumers and capitalize on the growth of connected devices. For more information, visit smithmicro.com. (NASDAQ: SMSI)
Safe Harbor Statement:
This release contains forward-looking statements that involve risks and uncertainties, including without limitation, forward-looking statements relating to the company’s customer concentration given that the majority of our sales depend on a few large client relationships, including Sprint, the risk of being delisted from the NASDAQ Global Select Market if we fail to meet any of the listing requirements, financial prospects and other projections of its performance, the existence of new market opportunities and interest in the company’s products and solutions, and the company’s ability to increase its revenue by capitalizing on these new market opportunities. Among the important factors that could cause actual results to differ materially from those expressed or implied in the forward-looking statements are the risk that we may need to raise additional capital to fund our operations and such capital may not be available to us at commercially reasonable terms or at all, changes in demand for the company’s products from its customers and their end-users, new and changing technologies, customer acceptance and timing of deployment of those technologies, and the company’s ability to compete effectively with other software companies. These and other factors discussed in the company’s filings with the Securities and Exchange Commission, including our filings on Forms 10-K and 10-Q, could cause actual results to differ materially from those expressed or implied in any forward-looking statements. The forward-looking statements contained in this release are made on the basis of the views and assumptions of management regarding future events and business performance as of the date of this release, and the company does not undertake any obligation to update these statements to reflect events or circumstances occurring after the date of this release.
Smith Micro and the Smith Micro logo are registered trademarks or trademarks of Smith Micro Software, Inc. All other trademarks and product names are the property of their respective companies.
Note: Financial Schedules Attached
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| Smith Micro Software First Quarter 2015 Financial Results | | Page 4 of 6 |
Smith Micro Software, Inc.
Reconciliation of GAAP to Non-GAAP Results
(in thousands, except per share amounts) - unaudited
| | | | | | | | | | | | | | | | |
| | | | | | Stock | | | | | | Non- | |
| | | GAAP | | | Compensation | | | Taxes | | | GAAP | |
Three Months Ended 3/31/15: | | | | | | | | | | | | | | | | |
Gross profit | | $ | 8,411 | | | $ | 3 | | | $ | — | | | $ | 8,414 | |
Profit before provision for income taxes | | $ | 1 | | | $ | 609 | | | $ | — | | | $ | 610 | |
Net income (loss) | | ($ | 10 | ) | | $ | 609 | | | ($ | 221 | ) | | $ | 378 | |
EPS-diluted | | ($ | 0.00 | ) | | $ | 0.01 | | | ($ | 0.00 | ) | | $ | 0.01 | |
Three Months Ended 3/31/14: | | | | | | | | | | | | | | | | |
Gross profit | | $ | 6,029 | | | $ | 5 | | | $ | — | | | $ | 6,034 | |
Loss before provision for income taxes | | ($ | 5,134 | ) | | $ | 798 | | | $ | — | | | ($ | 4,336 | ) |
Net loss | | ($ | 5,167 | ) | | $ | 798 | | | $ | 1,681 | | | ($ | 2,688 | ) |
EPS-diluted | | ($ | 0.14 | ) | | $ | 0.02 | | | $ | 0.05 | | | ($ | 0.07 | ) |
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| Smith Micro Software First Quarter 2015 Financial Results | | Page 5 of 6 |
Smith Micro Software, Inc.
Statements of Comprehensive Income (Loss) for the Three Months Ended March 31, 2015 and 2014
(in thousands, except per share amounts) - unaudited
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| | | For the Three Months | |
| | | Ended March 31, | |
| | | 2015 | | | 2014 | |
Revenues | | $ | 10,529 | | | $ | 8,449 | |
Cost of revenues | | | 2,118 | | | | 2,420 | |
| | | | | | | | |
Gross profit | | | 8,411 | | | | 6,029 | |
Operating expenses: | | | | | | | | |
Selling and marketing | | | 2,191 | | | | 3,036 | |
Research and development | | | 3,341 | | | | 4,249 | |
General and administrative | | | 2,877 | | | | 3,878 | |
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Total operating expenses | | | 8,409 | | | | 11,163 | |
| | | | | | | | |
Operating income (loss) | | | 2 | | | | (5,134 | ) |
Interest and other income (expense), net | | | (1 | ) | | | — | |
| | | | | | | | |
Income (loss) before provision for income taxes | | | 1 | | | | (5,134 | ) |
| | | | | | | | |
Provision for income tax expense | | | 11 | | | | 33 | |
| | | | | | | | |
Net loss | | $ | (10 | ) | | $ | (5,167 | ) |
| | | | | | | | |
Other comprehensive income, before tax: | | | | | | | | |
Unrealized holding gains on available-for-sale securities | | | 1 | | | | — | |
Income tax expense related to items of other comprehensive income | | | — | | | | — | |
| | | | | | | | |
Other comprehensive income, net of tax | | | 1 | | | | — | |
| | | | | | | | |
Comprehensive loss | | $ | (9 | ) | | $ | (5,167 | ) |
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Earnings (loss) per share: | | | | | | | | |
Basic and diluted | | $ | (0.00 | ) | | $ | (0.14 | ) |
Weighted average shares outstanding: | | | | | | | | |
Basic and diluted | | | 45,501 | | | | 37,714 | |
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| Smith Micro Software First Quarter 2015 Financial Results | | Page 6 of 6 |
Smith Micro Software, Inc.
Consolidated Balance Sheets
(in thousands)
| | | | | | | | |
| | | March 31, | | | December 31, | |
| | | 2015 | | | 2014 | |
| | | (unaudited) | | | (audited) | |
ASSETS | | | | | | | | |
Current Assets: | | | | | | | | |
Cash & cash equivalents | | $ | 9,977 | | | $ | 10,165 | |
Short term investments | | | 3,800 | | | | 2,880 | |
Accounts receivable, net | | | 7,598 | | | | 8,216 | |
Income tax receivable | | | 33 | | | | 706 | |
Inventory, net | | | 87 | | | | 97 | |
Prepaid and other assets | | | 696 | | | | 765 | |
| | | | | | | | |
Total current assets | | | 22,191 | | | | 22,829 | |
Equipment & improvements, net | | | 3,799 | | | | 4,273 | |
Other assets | | | 221 | | | | 214 | |
Deferred tax asset | | | 74 | | | | 74 | |
| | | | | | | | |
TOTAL ASSETS | | $ | 26,285 | | | $ | 27,390 | |
| | | | | | | | |
LIABILITIES & STOCKHOLDERS’ EQUITY | | | | | | | | |
Current Liabilities: | | | | | | | | |
Accounts payable | | $ | 1,660 | | | $ | 1,521 | |
Accrued liabilities | | | 5,129 | | | | 5,752 | |
Deferred revenue | | | 331 | | | | 1,498 | |
Deferred tax liability | | | 74 | | | | 74 | |
| | | | | | | | |
Total current liabilities | | | 7,194 | | | | 8,845 | |
Long-term liabilities | | | 3,766 | | | | 3,643 | |
| | | | | | | | |
Total non-current liabilities | | | 3,766 | | | | 3,643 | |
Stockholders’ Equity: | | | | | | | | |
Common stock | | | 46 | | | | 45 | |
Additional paid in capital | | | 223,572 | | | | 223,141 | |
Accumulated comprehensive deficit | | | (208,293 | ) | | | (208,284 | ) |
| | | | | | | | |
Total stockholders’ equity | | | 15,325 | | | | 14,902 | |
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TOTAL LIABILITIES & STOCKHOLDERS’ EQUITY | | $ | 26,285 | | | $ | 27,390 | |
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