Exhibit 99.1
Immersion Corporation Reports First Quarter 2004 Financial Results
SAN JOSE, Calif.--(BUSINESS WIRE)--April 26, 2004--Immersion
Corporation, (Nasdaq:IMMR), a leading developer and licensor of touch
feedback technology, today announced revenues for the quarter ended
March 31, 2004 of $5.4 million compared to revenues of $3.7 million in
the first quarter of 2003. Net loss on a Generally Accepted Accounting
Principles (GAAP) basis for the first quarter of 2004 was $6.2
million, or $0.30 per share, compared to a net loss of $3.7 million,
or $0.18 per share, for the first quarter of 2003.
This quarter's net loss includes approximately $1.0 million, or
$0.05 per share, in non-cash charges relating to amortization for
stock-based compensation and intangible assets and accretion on our
Series A Redeemable Convertible Preferred Stock. This compares to
non-cash charges of approximately $0.6 million, or $0.03 per share,
attributable to amortization for stock-based compensation and
intangible assets in the same quarter last year.
Vic Viegas, Immersion's CEO said, "We are pleased with the 43
percent growth in revenues over last year, reflecting the performance
of our new sales and marketing team, which is largely responsible for
driving our strong top-line results this quarter. Revenues were higher
across all revenue categories and across each of our four businesses.
In 2004, we expect to see continued revenue growth in our business
segments as we expand our technology offerings and increase our
penetration of existing and new markets.
"Our quarterly loss resulted from higher operating expenses,
chiefly the increased litigation expense associated with the Sony
lawsuit. Litigation expense was $3.2 million in the first quarter of
2004 or $2.4 million higher than in the first quarter of 2003. While
litigation expense is a burden on our mission to achieve
profitability, we are prepared to protect and defend our intellectual
property. We have taken action to reduce costs in other areas such as
the renegotiation of the rent for our San Jose headquarters, which we
expect will generate approximately $400,000 in savings over a fifteen
month period," Viegas concluded.
Immersion will host a conference call with company management on
Monday, April 26, 2004, at 5:00 p.m. Eastern time to discuss operating
results for the first quarter ended March 31, 2004. A question and
answer session will follow. To listen to the call, dial (800)
374-2366, reservation number 4572176. The call will be archived and
available for replay until April 30, 2004, by dialing (800) 642-1687,
reservation number 4572176. The call will also be simulcast on the
Internet through Immersion Corporation's Web site,
http://www.immersion.com. An audio replay of the call will be archived
and available at http://www.immersion.com for replay until April 26,
2005.
About Immersion (www.immersion.com)
Founded in 1993, Immersion Corporation is a recognized leader in
developing, licensing and marketing digital touch technology and
products. Bringing value to markets where man-machine interaction
needs to be made more compelling, safer, or productive, Immersion
helps its partners broaden market reach by making the use of touch
feedback as critical a user experience as sight and sound. Immersion's
technology is deployed across personal computing, entertainment,
medical training, automotive, and three-dimensional simulation
markets. Immersion and its wholly owned subsidiaries hold more than
230 issued patents worldwide.
Forward-Looking Statements
This press release contains "forward-looking statements" that
involve risks and uncertainties, as well as assumptions that, if they
never materialize or prove incorrect, could cause the results of
Immersion Corporation and its consolidated subsidiaries to differ
materially from those expressed or implied by such forward-looking
statements.
All statements, other than the statements of historical fact, are
statements that may be deemed forward-looking statements, including
any projections of earnings, revenues, or other financial matters; any
statements of the plans, strategies, and objectives of management for
future operations; proposed products or services; any statements
regarding future economic conditions or performance; and statements of
belief or assumptions underlying any of the foregoing. Immersion's
actual results might differ materially from those stated or implied by
such forward-looking statements due to risks and uncertainties
associated with Immersion's business which include, but are not
limited to, delay in or failure to achieve commercial demand for
Immersion's expanded technology offerings or a delay in or failure to
achieve the acceptance of force feedback as a critical user experience
in new and existing markets for our business segments.
For a more detailed discussion of these factors, and other factors
that could cause the Company's actual results to vary materially,
interested parties should review the risk factors listed in the
Company's most current Form 10-K, which is on file with the U.S.
Securities and Exchange Commission. The forward-looking statements in
this press release reflect the Company's beliefs and predictions as of
the date of this release. The Company disclaims any obligation to
update these forward-looking statements as a result of financial,
business, or any other developments occurring after the date of this
release.
The Immersion logo is a trademark of Immersion Corporation. All
other trademarks are the property of their respective owners.
Immersion Corporation
Condensed Consolidated Statements of Operations
(In thousands, except per share amounts)
(Unaudited)
Three Months
Ended March 31,
2004 2003
--------- ---------
Revenues:
Royalty and license $ 1,831 $ 833
Product sales 2,444 2,148
Development contracts and other 1,080 755
--------- ---------
Total revenues 5,355 3,736
--------- ---------
Costs and expenses:
Cost of product sales (exclusive of
amortization of intangibles shown separately
below) 1,221 1,106
Sales and marketing 2,462 1,791
Research and development 1,889 1,689
General and administrative 4,878 2,156
Amortization of intangibles and deferred
stock compensation 513 649
--------- ---------
Total costs and expenses 10,963 7,391
--------- ---------
Operating loss (5,608) (3,655)
Interest and other income (expense), net (560) (2)
--------- ---------
Net loss $ (6,168) $ (3,657)
========= =========
Basic and diluted net loss per share $ (0.30) $ (0.18)
--------- ---------
Shares used in calculating basic and diluted net
loss per share 20,791 20,144
--------- ---------
Immersion Corporation
Condensed Consolidated Balance Sheets
(In thousands)
March 31, December 31,
2004 2003 (1)
(Unaudited)
ASSETS ----------- ------------
Cash and cash equivalents $ 18,788 $ 21,738
Accounts receivable, net 2,971 4,927
Inventories 2,393 2,099
Prepaid expenses and other current assets 973 1,099
----------- ------------
Total current assets 25,125 29,863
Property and equipment, net 1,368 1,454
Intangibles and other assets, net 6,685 6,596
TOTAL ASSETS $ 33,178 $ 37,913
=========== ============
LIABILITIES
Accounts payable $ 1,931 $ 1,752
Accrued compensation 1,287 864
Other accrued liabilities 2,567 2,066
Deferred revenue and customer advances 1,920 3,116
Current portion of long-term debt 28 33
----------- ------------
Total current liabilities 7,733 7,831
Long-term debt 13 16
Long-term liabilities and deferred revenue 4,157 4,235
Long-term customer advance from Microsoft 27,437 27,050
----------- ------------
Total liabilities 39,340 39,132
STOCKHOLDERS' DEFICIENCY (6,162) (1,219)
----------- ------------
TOTAL LIABILITIES & STOCKHOLDERS' DEFICIENCY $ 33,178 $ 37,913
=========== ============
(1) Derived from the Company's annual audited financial statements.
CONTACT: Immersion Corporation
Mike Zuckerman, 408-467-1900
Invest@immersion.com