EXHIBIT 99.1
PLX Technology, Inc. Reports Third Quarter 2007 Financial Results
-- PCI Express Revenues Grow 20% Sequentially
-- Company Builds Upon Industry-Leading PCI Express Gen 1
Portfolio with Introduction of Gen 2 Switch Family
Business Editors/High-Tech Editors
SUNNYVALE, Calif.--(BUSINESS WIRE)--Oct. 22, 2007--PLX Technology,
Inc. (NASDAQ:PLXT) today announced financial results for the third
quarter ended September 30, 2007.
"In the third quarter, we continued to improve company financial
results and our leadership position in the PCI Express market," said
Michael Salameh, PLX(R) Technology president and chief executive
officer.
"We achieved 20 percent sequential revenue growth in our PCI
Express product line, which comprised 36 percent of our third quarter
revenues. In September, we announced the first chips of our Gen 2 PCI
Express product family, including five switches ranging in capacity
from 12 lanes to 48 lanes, plus four additional Gen 1 chips. Since we
launched the PCI Express product line, we have shipped production
units, samples or development systems to more than 750 customers -
about 50 percent more than this time last year. This is an indication
of the broad adoption of the PCI Express standard in general and our
products in particular.
"We are pleased to see continued broadening of our customer base
and the types of applications and market segments using our PCI
Express chips. Last week, we announced a switch design in HP's
ProLiant DL580 G5 server, which is one example of the many types of
products that use our chips. PCI Express technology is becoming widely
adopted in many markets and our revenue producing applications include
servers, storage systems, host bus adapters, graphics adapters, HDTV
encoders, embedded computers and communications."
For the third quarter ended September 30, 2007, PLX reported net
revenues of $21.2 million, a one percent increase from the $21.0
million reported in the third quarter ended September 30, 2006, and a
seven percent increase from the $19.8 million reported in the second
quarter ended June 30, 2007. Net income for the third quarter ended
September 30, 2007, under U.S. generally accepted accounting
principles (GAAP), which included the effect of acquisition-related
amortization of $0.2 million and share-based compensation of $1.0
million, was $1.0 million, or income of $0.03 per share (diluted).
This compared to GAAP net income of $1.0 million, or $0.04 per share
(diluted), in the third quarter ended September 30, 2006, and a GAAP
net loss of $82,000, or $0.00 per share (diluted), in the second
quarter ended June 30, 2007.
The Company's gross margin for the third quarter ended September
30, 2007, was 61.8 percent, as compared with 58.0 percent for the
third quarter ended September 30, 2006, and 58.9 percent for the
second quarter ended June 30, 2007. The increase in gross margin was
driven by improved PCI Express gross margins and changes in product
mix.
Operating expenses under GAAP for the third quarter ended
September 30, 2007, were $12.0 million, as compared to $12.6 million
for the second quarter ended June 30, 2007. The sequential decrease
was due primarily lower engineering cost, share-based compensation and
acquisition-related amortization.
The Company's balance sheet remained strong. At September 30,
2007, cash and investments were $49.3 million, compared to $42.3
million at December 31, 2006. Additionally, there continues to be no
debt.
Business Outlook
The following statements are based on current expectations. The
Company does not intend to update, confirm or change this guidance
until its fourth-quarter earnings release, although it may provide
additional detail regarding its guidance on today's scheduled
conference call.
-- Net revenues for the fourth quarter ended December 31, 2007,
are expected to be between $21.5 million and $22.5 million,
with approximately 42 percent of total net revenues
attributable to PCI Express products.
-- Gross margins are expected to be approximately 60 percent.
-- Operating expenses under GAAP are expected to be $13.2
million. The increase in operating expenses is driven by
expenditures related to the cost for tape-out for several new
products. Included in operating expenses are share-based
compensation and acquisition-related amortization, which are
expected to be approximately $1.4 million.
PLX management plans to conduct a conference call today at 2:00
p.m. PDT to discuss its third-quarter financial results, as well as
its fourth-quarter outlook. There will also be a live Webcast and a
replay of the conference call available through the Investors section
of the PLX Web site at www.plxtech.com/investors. To dial into the
live Webcast, please call 913.312.1497. A recorded replay of this
Webcast will be available on the PLX Website beginning 5:00 p.m. (PDT)
on October 22, 2007, through 5:00 p.m. (PDT) on October 29, 2007. To
listen to the replay via telephone, call 719.457.0820, and use access
code 3495486. The Webcast can also be accessed through www.ccbn.com.
For the live Webcast, listeners should go to the PLX Investors
page at least 15 minutes before the event starts to download and
install any necessary audio software. The archived Webcast is
typically available one to two hours after the end of the live call.
About PLX
PLX Technology, Inc. (www.plxtech.com), based in Sunnyvale,
Calif., USA, is the world's leading supplier of PCI Express and other
standard I/O interconnect semiconductors to the communications,
server, storage, embedded-control, and consumer markets. The Company
provides a competitive advantage through an integrated combination of
experience, high-performance silicon, hardware and software design
tools, and global partnerships. These innovative solutions enable
customers to develop equipment with industry-leading performance,
scalability and reliability that allows them to bring designs to
market faster.
SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION
REFORM ACT OF 1995
This release includes statements that qualify as forward-looking
statements under the Private Securities Litigation Reform Act of 1995.
These include statements about the Company's estimated revenues,
estimates of revenues attributable to certain products, estimated
expenses, and estimated gross margins for the fourth quarter of 2007,
which are set forth under the caption "Business Outlook," and
statements regarding the PCI Express products. Such statements involve
risks and uncertainties, which may cause actual results to differ
materially from those set forth in the statements. Factors that could
cause actual results to differ materially include risks and
uncertainties, such as reduced demand for products of electronic
equipment manufacturers, which include the Company's products, adverse
economic conditions in general or those specifically affecting the
Company's markets, reduced acceptance of the Company's PCI Express
products, technical difficulties and delays in the development
process, errors in the products, reduced backlog for the Company's
customers and unexpected expenses. Please refer to the documents filed
by the Company with the SEC from time to time, including, but not
limited to, the Annual Report on Form 10-K for the year ended December
31, 2006 and PLX's quarterly report on Form 10-Q for the quarters
ended March 31, 2006 and June 30, 2007, which identify important risk
factors that could cause actual results to differ from those contained
in the forward-looking statements. All forward-looking statements are
made as of today, and the Company assumes no obligation to update such
statements.
PLX and the PLX logo are trademarks of PLX Technology, Inc., which
may be registered in some jurisdictions. All other product names that
appear in this material are for identification purposes only and are
acknowledged to be trademarks or registered trademarks of their
respective companies.
PLX TECHNOLOGY, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(in thousands, except per share amounts)
Three Months Ended Nine Months Ended
September 30 September 30 June 30 September 30
-----------------
2007 2006 2007 2007 2006
------------ ------------ -------- --------- -------
Net revenues (1) $ 21,216 $ 21,046 $19,764 $ 59,620 $60,462
Cost of revenues
(1) 8,108 8,836 8,118 23,489 24,558
------------ ------------ -------- --------- -------
Gross margin 13,108 12,210 11,646 36,131 35,904
Operating
expenses:
Research and
development 5,870 5,396 6,143 17,755 15,310
Selling,
general and
administrative 5,912 5,609 6,061 18,143 17,266
Amortization of
purchased
intangible
assets 241 440 357 1,038 1,433
------------ ------------ -------- --------- -------
Total operating
expenses 12,023 11,445 12,561 36,936 34,009
Income (loss)
from operations 1,085 765 (915) (805) 1,895
Interest income
and other, net 624 484 607 1,805 1,247
------------ ------------ -------- --------- -------
Income (loss)
before provision
(benefit) for
income taxes 1,709 1,249 (308) 1,000 3,142
Provision
(benefit) for
income taxes 712 227 (226) 357 298
------------ ------------ -------- --------- -------
Net income (loss) $ 997 $ 1,022 $ (82) $ 643 $ 2,844
============ ============ ======== ========= =======
Basic net income
(loss) per share $ 0.03 $ 0.04 $ (0.00) $ 0.02 $ 0.10
============ ============ ======== ========= =======
Shares used to
compute basic
per share
amounts 28,748 28,241 28,674 28,689 28,070
============ ============ ======== ========= =======
Diluted net
income (loss)
per share $ 0.03 $ 0.04 $ (0.00) $ 0.02 $ 0.10
============ ============ ======== ========= =======
Shares used to
compute diluted
per share
amounts 29,254 28,783 28,674 29,142 28,843
============ ============ ======== ========= =======
(1) Net revenues and cost of revenues for the nine months ended
September 30, 2006 include a one-time pick-up in revenue of $2.8
million and $0.9 million, respectively, which result from a change in
accounting for revenues to distributors.
PLX TECHNOLOGY, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
September 30 December 31
2007 2006 (1 )
------------- -----------
(unaudited)
ASSETS
Cash and investments $ 49,326 $ 42,323
Accounts receivable, net 8,848 8,491
Inventories 8,260 8,295
Property and equipment, net 29,516 28,744
Goodwill 34,976 34,976
Other intangible assets 1,820 2,856
Other assets 3,664 2,263
------------- -----------
Total assets $ 136,410 $ 127,948
============= ===========
LIABILITIES
Accounts payable $ 7,081 $ 2,995
Accrued compensation and benefits 2,202 2,417
Accrued commissions 505 1,100
Other accrued expenses 816 500
------------- -----------
Total liabilities 10,604 7,012
STOCKHOLDERS' EQUITY
Common stock, par value 29 29
Additional paid-in capital 133,026 128,735
Accumulated other comprehensive loss (160) (96)
Accumulated deficit (7,089) (7,732)
------------- -----------
Total stockholders' equity 125,806 120,936
------------- -----------
Total liabilities and stockholders' equity $ 136,410 $ 127,948
============= ===========
(1) Derived from audited financial statements
PLX TECHNOLOGY, INC.
SUPPLEMENTAL DATA
(Unaudited)
3Q07 3Q07
vs vs
Percentage of Net Revenues 3Q06 2Q07
-----------
3Q07 3Q06 2Q07 % %
------- ----------- ------- ----- -----
Net Revenues by Geography
Americas 28.3% 30.6% 29.4% (7%) 3%
Asia Pacific 60.2% 57.0% 60.5% 6% 7%
Europe 11.5% 12.4% 10.1% (7%) 22%
Share-Based Compensation
(in thousands)
3Q07 3Q06 2Q07
------- ----------- -------
Manufacturing $ 12 $ 13 $ 13
Research and development 376 485 422
Selling, general and
administrative 622 674 777
------- ----------- -------
$1,010 $1,172 $1,212
======= =========== =======
CONTACT: PLX Technology, Inc.
Arthur O. Whipple, CFO, 408-774-9060 (Company contact)
investor-relations@plxtech.com
or
CommonGround Communications (for PLX)
Jerry Steach, 415-222-9996 (Editorial contact)
jsteach@plxtech.com