EXHIBIT 99.1
Immersion Corporation Reports First Quarter 2005 Financial Results
SAN JOSE, Calif.--(BUSINESS WIRE)--April 25, 2005--Immersion
Corporation (Nasdaq:IMMR), a leading developer and licensor of touch
feedback technology, today announced revenues of $5.8 million for the
quarter ended March 31, 2005 compared to revenues of $5.4 million for
the first quarter of 2004. Net loss on a Generally Accepted Accounting
Principles (GAAP) basis for the first quarter of 2005 was $3.1
million, or $0.13 per share, compared to a net loss of $6.2 million,
or $0.30 per share, for the first quarter of 2004. As of March 31,
2005, Immersion had cash and cash equivalents totaling $26.9 million
as compared to $25.5 million as of December 31, 2004.
"In April, we reached a major milestone in our mobility business,"
said Vic Viegas, Immersion CEO. "Verizon Wireless and the two leading
mobile service operators in Korea, SK Telecom and KTF, released
Samsung mobile phones with Immersion's VibeTonz(TM) technology. We
also announced content relationships with American Greetings
Interactive, Indiagames, and Pulse Interactive. All of these companies
develop content for multiple mobile phone platforms and distribute it
to many of the world's largest mobile service operators. All have
produced VibeTonz-enabled downloadable ringtones or games soon to be
available on Verizon's Get It Now service.
"On March 24, 2005, the U.S. District Court for the Northern
District of California entered a judgment in favor of Immersion in our
patent infringement suit against Sony Computer Entertainment, Inc. and
Sony Computer Entertainment of America, Inc. (Sony). This judgment
awarded Immersion $82.0 million in past damages plus pre-judgment
interest in the amount of $8.7 million, for a total of $90.7 million.
We remain confident of our position in the anticipated appeals
process. Our cash balance puts us in a stable position for both
defending our intellectual property and investing in new growth
opportunities," concluded Viegas.
Immersion will host a conference call with company management on
Monday, April 25, 2005, at 5:00 p.m. EDT to discuss operating results
for the first quarter ended March 31, 2005. A question and answer
session will follow. To listen to the call, dial 800-374-2366
approximately five minutes prior to the start of the call and enter
confirmation number 2696092. The call will be archived and available
for replay until April 29, 2005, by dialing 800-642-1687 and entering
confirmation number 2696092. 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 www.immersion.com for replay until April 29, 2006.
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 automotive, entertainment, medical
training, mobility, personal computing, and three-dimensional
simulation markets. Immersion and its wholly-owned subsidiaries hold
more than 270 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.
Immersion, the Immersion logo, and VibeTonz are trademarks of
Immersion Corporation in the U.S. and other countries. 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,
2005 2004
-------- --------
Revenues:
Royalty and license $2,471 $1,831
Product sales 2,695 2,444
Development contracts and other 606 1,080
-------- --------
Total revenues 5,772 5,355
-------- --------
Costs and expenses:
Cost of product sales (exclusive of amortization
of intangibles shown separately below) 1,389 1,221
Sales and marketing 2,819 2,462
Research and development 1,507 1,889
General and administrative 2,286 4,878
Amortization of intangibles and deferred
stock compensation 369 513
Restructuring 185 0
-------- --------
Total costs and expenses 8,555 10,963
-------- --------
Operating loss (2,783) (5,608)
Interest and other income (expense), net (285) (560)
-------- --------
Loss before provision for income taxes (3,068) (6,168)
Provision for income taxes (65) 0
-------- --------
Net loss ($3,133) ($6,168)
======== ========
Basic and diluted net loss per share ($0.13) ($0.30)
-------- --------
Shares used in calculating basic and diluted
net loss per share 23,663 20,791
-------- --------
Immersion Corporation
Condensed Consolidated Balance Sheets
(In thousands)
March 31, December 31,
2005 2004
(Unaudited) (1)
---------- ----------
ASSETS
Cash and cash equivalents $ 26,913 $ 25,538
Accounts receivable, net 5,426 5,435
Inventories 1,935 1,805
Prepaid expenses and other current assets 1,667 1,280
---------- ----------
Total current assets 35,941 34,058
Property and equipment, net 1,062 1,174
Intangibles and other assets, net 6,896 7,018
---------- ----------
TOTAL ASSETS $ 43,899 $ 42,250
=========== ============
LIABILITIES
Accounts payable $ 1,209 $ 4,038
Accrued compensation 1,528 1,499
Other accrued liabilities 1,770 2,002
Deferred revenue and customer advances 4,287 3,420
Current portion of long-term debt 11 11
---------- ----------
Total current liabilities 8,805 10,970
Long-term debt 16,980 16,917
Long-term liabilities and deferred revenue 10,999 5,330
Long-term customer advance from Microsoft 15,000 15,000
---------- ----------
Total liabilities 51,784 48,217
STOCKHOLDERS' EQUITY/(DEFICIENCY) (7,885) (5,967)
---------- ----------
TOTAL LIABILITIES &
STOCKHOLDERS' EQUITY/(DEFICIENCY) $ 43,899 $ 42,250
=========== ============
(1) Derived from the Company's annual audited financial statements.
CONTACT: Immersion Corporation
Stephen Ambler, 408-467-1900
invest@immersion.com