Exhibit 99.1
FOR IMMEDIATE RELEASE [GRAPHIC LOGO OMITTED]
SYCAMORE NETWORKS, INC.
CONTACT:
Press Inquiries Investor Inquiries
Scott Larson Andrew Kramer
Public Relations Investor Relations
Sycamore Networks, Inc. Sycamore Networks, Inc.
978-250-3433 978-367-7368
scott.larson@sycamorenet.com andy.kramer@sycamorenet.com
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SYCAMORE NETWORKS, INC. REPORTS FIRST QUARTER FISCAL YEAR 2004 FINANCIAL RESULTS
CHELMSFORD, Mass., November 11, 2003 - Sycamore Networks, Inc. (NASDAQ: SCMR),
a leader in intelligent optical networking, today reported its first quarter
results for the period ended October 25, 2003.
Revenue for the first quarter of fiscal 2004 was $8.4 million, compared with
$5.9 million for the first quarter of fiscal 2003.
Net loss for the first quarter of fiscal 2004, on a generally accepted
accounting principles (GAAP) basis, was $12.2 million or $(0.05) per share,
compared with a net loss of $17.4 million, or $(0.07) per share for the first
quarter of fiscal 2003. Pro forma net loss, a non-GAAP financial measure, for
the first quarter of fiscal 2004 was $10.7 million, or $(0.04) per share,
compared with a pro forma net loss of $15.0 million, or $(0.06) per share for
the first quarter of fiscal 2003. The reconciliation between net loss on a GAAP
basis and pro forma net loss is provided in a table immediately following the
Unaudited Consolidated Statements of Operations.
"Sycamore's first quarter financial results reflect efforts to balance strategic
investments in the business with expense management and cash preservation,"
stated Daniel E. Smith, Sycamore's president and chief executive officer.
"Despite challenging market conditions, we continue to support initiatives
covering technology innovation, customer relationships and financial
management."
Conference Call Webcast
Sycamore plans to review its first quarter results and discuss its business
outlook during a conference call today beginning at 4:30 p.m. EST. A Webcast of
the conference call, along with GAAP reconciliation information, is available to
all interested parties on the Sycamore web site located at www.sycamorenet.com
under the Investor Relations section. Interested investors are encouraged to log
onto the broadcast at least 15 minutes prior to the call. Participating in the
call will be Sycamore's president and chief executive officer, Daniel E. Smith
and chief financial officer, Frances M. Jewels.
About Sycamore Networks
Sycamore Networks, Inc. (NASDAQ: SCMR) develops and markets optical networking
products for telecommunications service providers worldwide. The Company's
products enable service providers to easily and cost-effectively transition
their existing fiber optic network into an infrastructure that can provision,
manage and deliver economic, high-bandwidth services to their customers. For
more information, please visit www.sycamorenet.com.
Except for the historical information contained herein, we wish to caution you
that certain matters discussed in this news release constitute forward-looking
statements that involve risks and uncertainties. Actual results or events could
differ materially from those stated or implied in forward-looking statements due
to a number of factors, including but not limited to the rate of product
purchases by current and prospective customers; the commercial success of the
Company's line of intelligent optical networking products; the Company's
reliance on a limited number of customers; new product introductions and
enhancements by the Company and its competitors; the length and variability of
the sales cycles for the Company's products; competition; manufacturing and
sourcing risks; variations in the Company's quarterly results; general economic
conditions including stock market volatility and capital market conditions as
well as conditions specific to the telecommunications, Internet and related
industries; and the other factors discussed in the Company's most recently filed
Form 10-K and Form 10-Q, and the other reports filed by the Company from time to
time with the Securities and Exchange Commission. The Company disclaims any
intention or obligation to update or revise any forward-looking statements,
whether as a result of new information, future results or otherwise.
Use of Non-GAAP Financial Measures
The Company provides pro forma financial data in addition to providing financial
results in accordance with GAAP. These measures are not in accordance with, or
an alternative for GAAP, and may be different from pro forma measures used by
other companies. The items excluded from pro forma results have one or more of
the following characteristics: their magnitude and timing is largely outside of
the Company's control; they are unrelated to the ongoing operation of the
business in the ordinary course; they are unusual, and the Company does not
expect them to occur in the ordinary course of business; or they are
non-operational, non-cash expenses involving stock option grants primarily in
connection with the Company's initial public offering and acquisitions.
The non-GAAP financial data is provided to enhance the user's overall
understanding of the Company's current financial performance and its prospects
for the future. Specifically, the Company believes the non-GAAP results provide
useful information to both management and investors by excluding certain expense
and income items that the Company believes are not indicative of the Company's
core operating results because such charges are associated with past events and
are not related to current operations. In addition, since the Company has
historically reported non-GAAP results to the investment community, the Company
believes the inclusion of non-GAAP numbers provides consistency in its financial
reporting. Further, these non-GAAP results are one of the primary indicators
management uses for planning and forecasting in future periods. The non-GAAP
financial data should be considered in addition to, not as a substitute for or
as being superior to, operating losses, cash flows, or other measures of
financial performance prepared in accordance with GAAP.
Sycamore Networks, Inc.
Unaudited Condensed Consolidated Balance Sheets
(in thousands)
October 25, 2003 July 31, 2003
---------------- -------------
Assets
Current assets:
Cash and cash equivalents $ 221,539 $ 250,595
Short-term investments 428,636 421,784
Accounts receivable, net 7,374 10,769
Inventories 7,311 5,117
Prepaids and other current assets 4,491 3,680
----------- -----------
Total current assets 669,351 691,945
Property and equipment, net 12,176 14,589
Long-term investments 336,674 323,204
Other assets 2,567 2,890
----------- -----------
Total Assets $ 1,020,768 $ 1,032,628
=========== ===========
Liabilities and Stockholders' Equity
Deferred revenue $ 2,629 $ 2,677
Other current liabilities 18,853 18,350
Restructuring liabilities 17,233 19,086
----------- -----------
Total current liabilities 38,715 40,113
Common stock 272 272
Additional paid-in capital 1,734,576 1,733,476
Accumulated deficit (748,369) (736,192)
Other equity (4,426) (5,041)
----------- -----------
Total stockholders' equity 982,053 992,515
----------- -----------
Total Liabilities and Stockholders' Equity $ 1,020,768 $ 1,032,628
=========== ===========
Sycamore Networks, Inc.
Unaudited Consolidated Statements of Operations
(in thousands, except per share data)
Three Months Ended
October 25, October 26,
2003 2002
---- ----
Revenue $ 8,441 $ 5,938
Cost of revenue 5,719 7,143
Stock-based compensation 180 356
Payroll tax on stock option exercises 5 --
--------- ---------
Gross profit (loss) 2,537 (1,561)
Operating expenses:
Research and development 11,297 13,923
Sales and marketing 4,410 4,941
General and administrative 1,968 1,658
Stock-based compensation 1,305 2,017
Payroll tax on stock option exercises 2 5
--------- ---------
Total operating expenses 18,982 22,544
Loss from operations (16,445) (24,105)
Interest and other income, net 4,268 6,743
--------- ---------
Net loss $ (12,177) $ (17,362)
========= =========
Diluted net loss per share $ (0.05) $ (0.07)
Weighted average shares used in computing
diluted net loss per share 270,474 262,300
Sycamore Networks, Inc.
Unaudited Pro Forma Consolidated Statements of Operations (a Non-GAAP Financial
Measure) (a)
(in thousands, except per share data)
Three Months Ended October 25, 2003 Three Months Ended October 26, 2002
Pro Forma Pro Forma
GAAP Results GAAP Results
Results Adjustments (Non-GAAP)(a) Results Adjustments (Non-GAAP)(a)
------- ----------- ------------ ------- ----------- ------------
Revenue $ 8,441 $ -- $ 8,441 $ 5,938 $ -- $ 5,938
Cost of revenue 5,719 -- 5,719 7,143 -- 7,143
Stock-based compensation 180 (180) -- 356 (356) --
Payroll tax on stock option
exercises 5 (5) -- -- -- --
--------- --------- --------- --------- --------- ---------
Gross profit (loss) 2,537 185 2,722 (1,561) 356 (1,205)
Operating expenses:
Research and development 11,297 -- 11,297 13,923 -- 13,923
Sales and marketing 4,410 -- 4,410 4,941 -- 4,941
General and administrative 1,968 -- 1,968 1,658 -- 1,658
Stock-based compensation 1,305 (1,305) -- 2,017 (2,017) --
Payroll tax on stock option
exercises 2 (2) -- 5 (5) --
--------- --------- --------- --------- --------- ---------
Total operating expenses 18,982 (1,307) 17,675 22,544 (2,022) 20,522
Loss from operations (16,445) 1,492 (14,953) (24,105) 2,378 (21,727)
Interest and other income, net 4,268 -- 4,268 6,743 -- 6,743
--------- --------- --------- --------- --------- ---------
Net loss $ (12,177) $ 1,492 $ (10,685) $ (17,362) $ 2,378 $ (14,984)
========= ========= ========= ========= ========= =========
Diluted net loss per share $ (0.05) $ (0.04) $ (0.07) $ (0.06)
Weighted average shares used in
computing diluted net loss per share 270,474 270,474 262,300 262,300
(a) These Unaudited Pro Forma Consolidated Statements of Operations (a Non-GAAP
Financial Measure) are for informational purposes only and are not presented in
accordance with GAAP. The adjustments necessary to provide a direct
reconciliation of the Non-GAAP Financial Measure to GAAP basis consolidated
statements of operations exclude stock-based compensation and payroll taxes on
stock option exercises included in gross profit (loss) and operating expenses.