Exhibt 99.1
IDT Reports Continued Revenue Growth in First Quarter Fiscal Year 2005
SANTA CLARA, Calif.--(BUSINESS WIRE)--July 22, 2004--
Revenues up 7 Percent as Company Reports $0.11 Non-GAAP EPS,
($0.05) GAAP EPS
IDT(TM) (Integrated Device Technology, Inc.)(Nasdaq:IDTI), a
leading communications IC company, today announced its quarterly
results for the quarter ended June 27, 2004, its first quarter of
fiscal 2005.
Revenues for the first fiscal quarter were $101.3 million, an
increase of 7 percent compared to the fourth quarter of fiscal 2004
and an increase of 22 percent from the first quarter of fiscal 2004.
On a non-GAAP basis, net income for the first fiscal quarter was $12.3
million, or $0.11 per diluted share, compared to a net income of $9.3
million, or $0.08 per diluted share, in the fourth quarter of fiscal
2004 and a net loss of $4.8 million, or ($0.05) per diluted share, for
the same quarter one year ago.
Including certain costs, charges and gains in accordance with
GAAP, the Company reported a net loss of $5.0 million, or ($0.05) per
diluted share, in the first quarter of fiscal 2005 compared to net
income of $7.7 million, or $0.07 per diluted share, in the fourth
quarter of fiscal 2004. On a GAAP basis, the Company reported a net
loss of $4.8 million, or ($0.05) per diluted share, for the first
quarter of fiscal 2004. The GAAP results for the quarter include a
one-time impairment charge of $12.8 million on an investment in a
privately held technology company. Further information, including a
detailed reconciliation of non-GAAP and GAAP results, is provided in
the financial tables of this release.
"We are pleased with our strong first-quarter financial results
and our third consecutive quarter of revenue and non-GAAP
profitability growth," said Greg Lang, president and CEO of IDT. "We
made progress in driving new market opportunities, such as serial
switching, and expanding our market share in existing product areas."
Q1FY05 Highlights:
-- The Company finalized its acquisition of ZettaCom, Inc, which,
together with resources from IDT, marks the formation of the
Company's serial-switching division. IDT will support the
Advanced Switching (AS) and PCI Express standards initiatives.
-- The Company extended its leadership in the network search
engine (NSE) space, with the introduction of the industry's
lowest-cost NSEs. The high-performance devices deliver up to
50 percent cost savings when compared to competing NSE
solutions and are ideally suited for cost-sensitive
applications in the enterprise and access markets.
-- IDT expanded its flow-control management product portfolio to
include a family of packet-exchange devices that includes the
industry's first system packet interface (SPI) exchange
product that integrates switching, aggregation and rate
adaptation of four lower-rate SPI-3 interfaces to the
higher-rate SPI-4 interface. These products are fully
compliant with industry-standard interface specifications and
target VPN firewall cards, Ethernet transport and
multi-service switches.
-- Building on its portfolio of multi-port devices targeting the
next-generation multimedia handset market, IDT introduced the
industry's first family of tri-port devices. Enabling
simultaneous access to the memory for three device ports, the
IDT tri-port products provide a high-speed, bi-directional
interface between three intelligent devices, such as an
applications or baseband processor, digital multimedia
broadcast (DMB) processor and an 802.11 processor.
-- Building on its leadership position in timing solutions, IDT
introduced the VersaTime(TM) family of highly versatile
programmable timing devices targeted at a wide range of
applications in the communications, storage, digital consumer,
and industrial markets. This product family represents the
industry's first complete portfolio of programmable skew and
zero-delay buffers with a non-volatile programming capability,
allowing customers to consolidate and replace the large number
of dedicated fixed-function clock devices used today to build
timing networks.
-- IDT furthered its presence in the PC clock space, introducing
the industry's first four-PLL-based device targeting
next-generation Intel desktop PC platforms for the performance
and mainstream markets. Rounding out its portfolio of PC clock
devices, IDT also unveiled a suite of three PLL-based PC
clocks also targeted at the next-generation desktop PC market.
These additions strengthen the IDT PC clock portfolio and
position the Company to deliver innovative solutions that
address the stringent requirements of the PC market.
-- IDT received a bronze award from Stack International in
recognition of its consistent level of achievement and overall
performance in meeting high-quality delivery and service
requirements during 2003. This is the second time in four
years that IDT has been recognized as one of the top three
suppliers.
-- IDT strengthened its executive management team in July with
the appointment of Julian Hawkins as vice president of
worldwide sales. Hawkins, a 20-year semiconductor industry
veteran, will be responsible for the global IDT sales
organization. Hawkins joins IDT from Infineon Technologies,
Inc., where he spent the last three years as vice president of
sales for North America.
Webcast and Conference Call Information
Investors can listen to a live or replay Webcast of the Company's
quarterly financial conference call at www.IDT.com. The live Webcast
begins at 1:30 p.m. PDT on July 22, 2004. The Webcast replay will be
available after 4 p.m. PDT on July 22 through August 12, 2004. A taped
telephone replay of the conference call will be available at (800)
475-6701 (access code is 738583) beginning at 5 p.m. PDT on July 22
and will be accessible until 9 p.m. PDT on July 29, 2004.
Investor Information
IDT stock is traded on the Nasdaq Stock Market(R) under the symbol
"IDTI." The company is included in the S&P 1000, which is a
combination of the S&P MidCap 400 and S&P SmallCap 600 Indices, and is
also part of the S&P SuperComposite 1500, which combines the S&P 500,
MidCap 400, and SmallCap 600. Additional information about IDT is
accessible at www.IDT.com.
About IDT
IDT is a global leader in preemptive semiconductor solutions that
accelerate packet processing for advanced network services. IDT serves
communications equipment vendors by applying its advanced hardware and
software technologies to create flexible, highly integrated solutions
that enhance the functionality and processing of network equipment.
IDT accelerates intelligent packet processing with products such as
switching solutions, network search engines (NSEs), programmable
content inspection engines (CIEs), flow-control management (FCM) ICs
and its family of Interprise(TM) integrated communications processors.
The portfolio also comprises products optimized for communications
applications, including telecom products, FIFOs, multi-ports, and
timing solutions. In addition, the product mix includes
high-performance digital logic and high-speed SRAMs to meet the
requirements of leading communications companies.
Headquartered in Santa Clara, Calif., the company employs
approximately 3,200 people worldwide and has a wafer manufacturing
facility in Oregon, and test and assembly facilities in the
Philippines and Malaysia.
Forward-looking statements in this release involve a number of
risks and uncertainties including, but not limited to, global business
and economic conditions, product demand, manufacturing capacity and
costs, competition, pricing, patent and other intellectual property
rights of third parties, timely development and supply of new products
and manufacturing processes, successful integration of acquired
businesses and technology, availability of capital, cash flow and
other risk factors detailed in the Company's Securities and Exchange
Commission filings. Actual results may differ materially from the
Company's projections.
IDT, Interprise and the IDT logo are trademarks of Integrated
Device Technology, Inc. All other brands, product names and marks are
or may be trademarks or registered trademarks used to identify
products or services of their respective owners.
INTEGRATED DEVICE TECHNOLOGY, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(In thousands, except per share data)
Three Months Ended
- ----------------------------------------------------------------------
Jun. 27, Mar. 28, Jun. 29,
2004 2004 2003
--------- -------- --------
Revenues $101,307 $94,521 $83,045
Cost of revenues 48,361 48,065 48,724
--------- -------- --------
Gross profit 52,946 46,456 34,321
--------- -------- --------
Operating expenses:
Research and development 26,001 23,846 25,366
Selling, general and
administrative 19,387 17,876 18,325
Acquired in-process research
and development 1,736 - -
--------- -------- --------
Total operating expenses 47,124 41,722 43,691
--------- -------- --------
Operating income (loss) 5,822 4,734 (9,370)
Interest expense (47) (65) (92)
Loss on equity investments (12,831) - -
Interest income and other, net 2,714 3,545 4,224
--------- -------- --------
Income (loss) before income taxes (4,342) 8,214 (5,238)
Provision (benefit) for income taxes 705 556 (486)
--------- -------- --------
Net income (loss) $(5,047) $7,658 $(4,752)
========= ======== ========
Net income (loss) per share:
Basic $(0.05) $0.07 $(0.05)
Diluted $(0.05) $0.07 $(0.05)
Weighted average shares:
Basic 106,026 105,432 103,872
Diluted 106,026 111,434 103,872
INTEGRATED DEVICE TECHNOLOGY, INC.
NON-GAAP ADJUSTMENTS
(Unaudited)
(In thousands)
Three Months Ended
- ----------------------------------------------------------------------
Jun. 27, Mar. 28, Jun. 29,
2004 2004 2003
-------- -------- ---------
Net income (loss) $(5,047) $7,658 $(4,752)
-------- -------- ---------
Non-GAAP adjustments:
Cost of goods sold:
Restructuring charges (1) 25 - 15
Plant closure costs (2) 195 219 282
Amortization of acquisition-
related intangibles (3) 1,014 573 234
Patent Settlement (18) 334 -
Operating expenses:
Acquired IPR&D (3) 1,736 - -
Plant closure costs (2) - - 36
Restructuring charges (1) 652 2 541
Amortization of acquisition-
related intangibles (3) 538 518 444
Acquisition related costs (4) 592 - -
Loss on equity investments (5) 12,831 - -
Other income (6) (209) - (722)
Taxes (6) (28) - (849)
-------- -------- ---------
Total Non-GAAP adjustments 17,328 1,646 (19)
-------- -------- ---------
Non-GAAP net income (loss) $12,281 $9,304 $(4,771)
======== ======== =========
(1) Consists of costs of restructuring actions announced in Fiscal
Years 2003-2005. For Q105 and Q404 primarily consists of severance
and for Q104 primarily consist of facility exit costs.
(2) Consists of costs associated with the closure of our Salinas
plant.
(3) Consists of costs related to our acquisition of Zettacom in Q1
2005, TCAM3 acquisition from IBM in Q2 2004 and acquisitions of
Newave and Solidum in Q1 2002 and Q3 2003, respectively.
Newave-related costs include stock-based compensation and
amortization of intangible assets. Zettacom, TCAM3 and
Solidum-related costs include only amortization of intangible
assets.
(4) Consists primarily of transitional costs incurred in connection
with the acquisition of Zettacom, such as retention earned by
former Zettacom employees, rent payments for the former Zettacom
facility, and transitional services provided.
(5) Impairment charge related to our investment in NetLogic.
(6) In Q105, we realized a gain on the sales of equipment from our
Salinas plant. In Q1 2004, we received non-recurring federal and
state tax refunds for tax years prior to 1996 plus interest.
INTEGRATED DEVICE TECHNOLOGY, INC.
NON-GAAP STATEMENTS OF OPERATIONS
(Unaudited)
(In thousands, except per share data)
Three Months Ended
- ----------------------------------------------------------------------
Jun. 27, Mar. 28, Jun. 29,
2004 2004 2003
--------- -------- --------
Revenues $101,307 $94,521 $83,045
Cost of Revenues 47,145 46,939 48,193
--------- -------- --------
Gross profit 54,162 47,582 34,852
--------- -------- --------
Operating expenses:
Research and development 24,950 23,485 24,592
Selling, general and
administrative 18,656 17,717 18,078
--------- -------- --------
Total operating expenses 43,606 41,202 42,670
--------- -------- --------
Operating income (loss) 10,556 6,380 (7,818)
Interest expense (47) (65) (92)
Interest income and other, net 2,505 3,545 3,502
--------- -------- --------
Income (loss) before income taxes 13,014 9,860 (4,408)
Provision for income taxes 733 556 363
--------- -------- --------
Net income (loss) $12,281 $9,304 $(4,771)
========= ======== ========
Net income (loss) per share:
Diluted $0.11 $0.08 $(0.05)
Weighted average shares:
Diluted 110,344 111,434 103,872
Non-GAAP results exclude acquisition-related charges, and other
expenses and benefits that management believes are not directly
related to our ongoing operations. These non-GAAP results are
consistent with another way management internally analyzes IDT's
results and may be useful; however, non-GAAP results are not in
accordance with GAAP and may not be comparable to non-GAAP information
provided by other companies. Non-GAAP information should be
considered a supplement to, and not a substitute for, financial
statements prepared in accordance with GAAP.
INTEGRATED DEVICE TECHNOLOGY, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
Jun. 27 Mar. 28,
(In thousands) 2004 2004
- ----------------------------------------------------------------------
ASSETS
Current assets:
Cash and cash equivalents $174,392 $223,360
Short-term investments 418,761 384,854
Accounts receivable, net 59,904 53,091
Inventories 39,120 32,745
Prepaids and other current assets 9,731 12,101
--------- ---------
Total current assets 701,908 706,151
Property, plant and equipment, net 111,027 108,424
Goodwill and other intangibles 89,252 52,784
Other assets 8,533 38,194
--------- ---------
TOTAL ASSETS $910,720 $905,553
========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $23,308 $20,190
Accrued compensation and related expenses 17,716 11,560
Deferred income on shipments to distributors 25,546 21,411
Income taxes payable 33,651 33,267
Other accrued liabilities 20,077 19,250
--------- ---------
Total current liabilities 120,298 105,678
Long term liabilities 14,226 15,651
--------- ---------
Total liabilities 134,524 121,329
Stockholders' equity 776,196 784,224
--------- ---------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $910,720 $905,553
========= =========
CONTACT: IDT
Tom McCallum, 408-654-6515 (Investor Relations)
ir@idt.com
Jim Rey, 408-492-8494 (Corporate Communications)
jim.rey@idt.com
or
Porter Novelli
Brad Langley, 408-369-1500 x636
brad.langley@porternovelli.com