Exhibit 99.1
NEWS RELEASE
Contact Information:
Scott Sullinger
Chief Financial Officer
(408) 486-3879
NEOMAGIC(R) CORPORATION REPORTS Q2 FISCAL 2006 RESULTS
Santa Clara, Calif. - September 8, 2005 - NeoMagic Corporation (Nasdaq:
NMGC), a pioneer in developing processors for multimedia-rich mobile phones and
other wireless handheld systems, today reported its second quarter fiscal 2006
financial results. Net sales for the second quarter of fiscal 2006, ended July
31, 2005, were $301 thousand, compared to net sales of $299 thousand for the
first quarter of fiscal 2006. Net loss for the second quarter of fiscal 2006 was
$4.5 million, or a loss of $0.67 per share, compared to a net loss of $1.6
million, or a loss of $0.25 per share, in the first quarter of fiscal 2006.
CONFERENCE CALL HIGHLIGHTS
Topics to be covered on NeoMagic's quarterly conference call include the
following:
o Sony Corporation has obtained a non-exclusive license to NeoMagic
patents for net proceeds of $5.6 million
o NeoMagic is in discussions with four additional companies with respect
to licensing NeoMagic patents. Over the next several months, NeoMagic
expects to contact several more companies.
o NeoMagic is working with leading Digital Mobile Broadcast (TV on
mobile device) component providers such as Frontier Silicon and Alps
to offer customers a complete Mobile TV solution.
o The Digital Mobile Broadcast TV market provides significant revenue
opportunities for NeoMagic.
o NeoMagic expects that NeoNode, a Swedish Mobile Phone Manufacturer,
will increase its orders of MiMagic 5 product during the fourth
quarter of calendar year 2005.
o The ODM program for a Top Five Mobile Phone OEM that was discussed
last quarter continues to move forward.
o The MiMagic 6-based feature phone manufactured by Compal
Communications is being shown to large OEMs.
o One of NeoMagic's OEM customers in Japan has finished a prototype TV
phone with the MiMagic 6 and is using it in field trials.
o The Company continues to work with a major Japanese phone carrier that
is considering the MiMagic 6 for several phone platforms.
DIAL-IN INFORMATION
NeoMagic will hold its second quarter fiscal 2006 conference call to discuss the
information contained in this press release today at 2:00 p.m. PDT (5:00 p.m.
EDT). The call can be accessed via the Internet at www.neomagic.com, "Investor
Resources." The call can also be accessed by dialing (866) 835-8903 in the US
and (703) 639-1410 internationally. There is no passcode. There will be an audio
replay through September 15, 2005, which can be accessed by dialing (888)
266-2081 in the US and (703) 925-2533 internationally. The passcode for the
replay is 748149.
The webcast is also being distributed over CCBN's Investor Distribution Network
to both institutional and individual investors. Individual investors can listen
to the call through CCBN's individual investor center at www.fulldisclosure.com
or by visiting any of the investor sites in CCBN's Individual Investor Network.
Institutional investors can access the call via CCBN's password-protected event
management site, StreetEvents (www.streetevents.com).
ABOUT NEOMAGIC
NeoMagic Corporation, based in Santa Clara, California, enables new generations
of handheld systems with its Multimedia Processors that are designed to offer
the lowest power, smallest form-factor and best multimedia features and
performance. The company is a pioneer in the integration of complex logic,
memory and analog circuits into single-chip solutions. Information on the
company may be found on the World Wide Web at www.neomagic.com.
This press release contains forward-looking statements within the meaning of the
Securities Act of 1933 and the Securities Exchange Act of 1934, including the
Company's revenue opportunities and the Company's ongoing patent licensing
efforts. Our patent licensing activities involve various risks and
uncertainties, including, without limitation, uncertainties as to the
willingness of other companies to pay material fees to license our intellectual
property, the length and uncertain outcome of licensing negotiations, the
possibility that litigation may be required to enforce patents, and the risks
and costs inherent in any patent litigation. These forward-looking statements
reflect current expectations. However, actual events and results could vary
significantly based on a variety of factors including but not limited to
customer acceptance of NeoMagic products, the market acceptance of mobile phones
developed and marketed by customers that use the Company's products, customer's
plans to develop smart phones and feature phones, the acceptance of advanced
multimedia services such as H.264 television on mobile phones, and the Company's
ability to execute product and technology development plans on schedule.
NeoMagic makes no representation that current or future design wins will result
in revenue for NeoMagic. Additional risks that could affect the Company's future
operating results are more fully described in the Company's most recent annual
report, its most recent quarterly report and other filings with the United
States Securities and Exchange Commission (SEC), and are available online at
http://www.sec.gov. NeoMagic may, from time to time, make additional written or
oral forward-looking statements, including statements contained in filings with
the SEC and reports to shareholders. NeoMagic does not undertake the obligation
to update any forward-looking statements that may be made by or on behalf of the
company.
NeoMagic, and the NeoMagic circle logo are registered trademarks, and MiMagic is
a trademark, of NeoMagic Corporation. All other trademarks are the property of
their respective owners. NeoMagic disclaims any proprietary interest in the
marks and names of others.
- tables to follow-
NEOMAGIC CORPORATION
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
(Unaudited)
Three Months Ended Six Months Ended
--------------------- ---------------------
July 31, April 30, July 31, July 31, July 31,
2005 2005 2004 2005 2004
--------- --------- --------- --------- ---------
Net sales $ 301 $ 299 $ 1,041 $ 600 $ 1,692
Cost of sales 304 332 1,044 636 1,759
Gross loss (3) (33) (3) (36) (67)
Operating expenses:
Research and development 3,147 3,083 4,819 6,230 9,687
Sales, general and
administrative 1,310 1,790 1,880 3,100 4,020
Gain on sale of patents 0 (3,481) 0 (3,481) 0
Total operating expenses 4,457 1,392 6,699 5,849 13,707
Loss from operations (4,460) (1,425) (6,702) (5,885) (13,774)
Interest income and other 177 117 92 294 195
Interest expense (132) (288) (53) (420) (77)
Loss before income taxes (4,415) (1,596) (6,663) (6,011) (13,656)
Income tax provision 50 49 7 99 14
Net loss $ (4,465) $ (1,645) $ (6,670) $ (6,110) $ (13,670)
Basic and diluted net loss
per share $ (0.67) $ (0.25) $ (1.02) $ (0.92) $ (2.12)
Weighted common shares
outstanding 6,694 6,647 6,510 6,670 6,461
NEOMAGIC CORPORATION
CONSOLIDATED CONDENSED BALANCE SHEETS
(In thousands)
(Unaudited)
July 31, 2005 April 30, 2005 January 31, 2005
-------------- -------------- ----------------
ASSETS
Current assets:
Cash and cash equivalents $ 14,749 $ 15,677 $ 8,944
Short-term investments 5,272 8,381 16,082
Accounts receivable, net 46 55 12
Inventory 108 228 376
Other current assets 835 874 792
Total current assets 21,010 25,215 26,206
Property, plant and equipment, net 3,005 3,425 3,835
Other assets 501 587 673
Total assets $ 24,516 $ 29,227 $ 30,714
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 1,137 $ 1,004 $ 1,084
Compensation and related benefits 894 1,299 1,017
Income taxes payable 3,941 3,895 3,851
Other accruals 159 212 225
Current portion of capital lease
obligations 1,480 1,167 1,602
Total current liabilities 7,611 7,577 7,779
Capital lease obligations 1,453 2,044 2,004
Mandatorily redeemable preferred stock 3,212 3,168 2,971
Other long-term liabilities 12 12 0
Stockholders' equity:
Common stock 34 33 33
Additional paid-in-capital 95,494 95,386 95,606
Deferred compensation (800) (959) (1,280)
Accumulated other comprehensive loss (5) (4) (14)
Accumulated deficit (82,495) (78,030) (76,385)
Total stockholders' equity 12,228 16,426 17,960
Total liabilities and stockholders'
equity $ 24,516 $ 29,227 $ 30,714