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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
DATE OF REPORT: JULY 26, 2006
(Date of earliest event reported)
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GSI COMMERCE, INC.
(Exact name of registrant as specified in its charter)
Delaware 0-16611 04-2958132
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File No.) Identification No.)
935 First Avenue, King of Prussia, PA 19406
(Address of principal executive offices and zip code)
(610) 265-3229
(Registrant's telephone number, including area code)
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions:
[ ] Written communications pursuant to Rule 425 under the Securities
Act (17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange
Act (17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
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ITEM 2.02 RESULTS OF OPERATIONS AND FINANCIAL CONDITION.
On July 26, 2006, GSI Commerce, Inc. ("GSI Commerce" or the "Registrant")
issued a press release announcing its results for the second fiscal quarter
ended July 1, 2006 and certain other information. A copy of the press release is
furnished as part of this report and incorporated herein by reference.
The press release (included as Exhibit 99.1) contains the non-GAAP measures
merchandise sales, adjusted EBITDA and certain ratios that use those measures.
Merchandise sales represent the retail value of all sales transactions,
inclusive of freight charges and net of allowances for returns and discounts,
which flow through the GSI Commerce platform, whether or not the company is the
seller of the merchandise or records the full amount of such sales on its
financial statements. GSI Commerce uses merchandise sales as a metric for
operating its business. Variable costs such as fulfillment and customer service
labor expense, order processing costs such as credit card and bank processing
fees and organizational costs such as business management are related to the
amount of sales made through GSI Commerce's platform, whether or not GSI
Commerce records the revenue from such sales. GSI Commerce believes that
investors will have a more thorough understanding of its historical expenses and
expense trends if they have visibility to GAAP net revenue as well as the
non-GAAP financial measure merchandise sales and the percentages that such
expenses bear to net revenues and merchandise sales.
GSI Commerce also uses adjusted EBITDA, which represents earnings (or
losses) before interest income/expense, impairment on investment, income taxes,
depreciation and amortization, cumulative effect of change in accounting
principle related to the adoption of SFAS 123(R) and stock-based compensation.
GSI Commerce uses adjusted EBITDA as a means to evaluate its performance period
to period without taking into account certain expenses, particularly stock-based
compensation expense, which historically has been materially impacted by
fluctuations in the price of GSI Commerce's common stock both on a quarterly and
annual basis, and is now materially impacted by the adoption of SFAS 123(R), and
does not consistently reflect GSI Commerce's results from its core business
activities.
These financial measures should be considered in addition to, and not as a
substitute for, or superior to, other measures of financial performance prepared
in accordance with GAAP. The non-GAAP financial measures included in the press
release and to be included the conference call have been reconciled to the
nearest GAAP measure as is required under Securities and Exchange Commission
rules.
As used herein, "GAAP" refers to accounting principles generally accepted
in the United States.
ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS.
99.1 Press Release, dated July 26, 2006
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
GSI COMMERCE, INC.
By: /s/ Michael G. Rubin
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Michael G. Rubin
Chairman and Chief Executive Officer
Dated: July 26, 2006
Exhibit Index
Exhibit No. Description
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99.1 Press Release, dated July 26, 2006