CAVIUM INC SAN JOSE, Calif., Oct. 28, 2015 /PRNewswire/ -- Cavium, Inc. (NASDAQ: CAVM), a leading provider of semiconductor products that enable secure and intelligent processing for enterprise, data center, wired and wireless networking, today announced financial results for the third quarter ended September 30, 2015.
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Net revenue in the third quarter of 2015 was $105.1 million, a 0.1% sequential increase from the $105.0 million reported in the second quarter of 2015 and a 7.4% year-over-year increase from the $97.8 million reported in the third quarter of 2014.
Generally Accepted Accounting Principles (GAAP) Results
Net income in the third quarter of 2015 was $4.2 million, or $0.07 per diluted share, compared to net loss of $6.4 million, or $(0.11) per diluted share in the second quarter of 2015. Gross margins were 65.5% in the third quarter of 2015 compared to 64.1% in the second quarter of 2015. Total cash and cash equivalents were $131.0 million at September 30, 2015.
Non-GAAP Results
Cavium believes that the presentation of non-GAAP financial measures provides important supplemental information to management and investors regarding financial and business trends relating to Cavium's financial condition and results of operations. These measures should only be used to evaluate Cavium's results of operations in conjunction with the corresponding GAAP measures. The reconciliation between GAAP and non-GAAP financial results is provided in the financial statements portion of this release.
In the third quarter of 2015, Non-GAAP net income was $22.5 million, or $0.38 per diluted share. Non-GAAP gross margin was 65.9% and Non-GAAP operating margin (non-GAAP income from operations as a percentage of revenue) was 21.8%.
Recent News Highlights
-- October 26, 2015 - Cavium to Demonstrate Solutions for Cloud
Infrastructure and Scale-Out Applications at OpenStack Summit Tokyo
-- October 10, 2015 - Accton Technology Contributes Design of 100 Gigabit
Ethernet Switch to Open Compute Project - the First OCP Design Based on
Cavium XPliant Switch ASIC
-- September 24, 2015 - Cavium Demonstrated Cloud Workload Instances at OVH
Summit 2015
-- September 9, 2015 - Cavium and Quantenna to Delivers Industry-Leading
10G Wave 3 Wi-Fi Solutions for Campus and Home WLAN Networks
-- August 19, 2015 - Cavium XPliant Switches and Microsoft Azure Networking
Achieved SAI Routing Interoperability
Cavium, Inc. will broadcast its third quarter of 2015 financial results conference call today, October 28, 2015, at 2 p.m. Pacific time (5 p.m. Eastern time). The conference call will be available via a live web cast on the investor relations section of the Cavium website at http://www.cavium.com. Please access the website at least a few minutes prior to the start of the call in order to download and install any necessary audio software. An archived web cast replay of the call will be available on the web site for a limited period of time.
About Cavium
Cavium is a leading provider of highly integrated semiconductor products that enable intelligent processing in enterprise, data center, cloud and wired and wireless service provider applications. Cavium offers a broad portfolio of integrated, software-compatible processors ranging in performance from 100 Mbps to 100 Gbps that enable secure, intelligent functionality in enterprise, data-center, broadband/consumer and access and service provider equipment. Cavium's processors are supported by ecosystem partners that provide operating systems, tool support, reference designs and other services. Cavium's principal office is in San Jose, CA with design team locations in California, Massachusetts, India and China. For more information, please visit: http://www.cavium.com.
CAVIUM, INC.
Unaudited GAAP Condensed Consolidated Statements of Operations
(in thousands, except per share amounts)
Three Months Ended
------------------
September 30,
2015 June 30, 2015
-------------- -------------
Net revenue $105,063 $104,961
Cost of
revenue 36,203 37,673
------ ------
Gross
profit 68,860 67,288
------ ------
Operating
expenses:
Research
and
development 45,367 52,225
Sales,
general
and
administrative 18,522 20,336
------ ------
Total
operating
expenses 63,889 72,561
------ ------
Income
(loss)
from
operations 4,971 (5,273)
----- ------
Other
expense,
net:
Interest
expense (216) (388)
Other, net (173) (33)
---- ---
Total
other
expense,
net (389) (421)
---- ----
Income
(loss)
before
income
taxes 4,582 (5,694)
Provision
for
income
taxes 366 661
--- ---
Net income (loss) $4,216 $(6,355)
====== =======
Net income (loss) per common share, basic $0.08 $(0.11)
Shares
used in
computing
basic net
income
(loss)
per
common
share 55,819 55,507
Net income (loss) per common share, diluted $0.07 $(0.11)
Shares
used in
computing
diluted
net
income
(loss)
per
common
share 57,457 55,507
CAVIUM, INC.
Unaudited Reconciliation of Non-GAAP Adjustments
(in thousands)
Three Months Ended
------------------
September 30, 2015 June 30, 2015
------------------ -------------
Reconciliation of GAAP operating expenses
to non-GAAP:
GAAP research and
development expenses $45,367 $52,225
Stock-based compensation and related
payroll taxes (7,766) (7,896)
Amortization of acquisition related assets (3,471) (2,932)
Net restructuring related expenses (140) -
Xpliant transition related expenses (971) -
Research and development expenses
associated with Xpliant - (8,845)
--- ------
Non-GAAP research and
development expenses $33,019 $32,552
------- -------
GAAP sales, general and
administrative expenses $18,522 $20,336
Stock-based compensation and related
payroll taxes (4,946) (4,429)
Amortization of acquisition related assets (4) (11)
Net restructuring related expenses (255) -
Sales, general and administrative expenses
associated with Xpliant - (2,554)
--- ------
Non-GAAP sales, general
and administrative
expenses $13,317 $13,342
------- -------
Total Non-GAAP operating
expenses $46,336 $45,894
======= =======
Reconciliation of GAAP non-operating
expenses to non-GAAP non-operating
income (expense):
GAAP non-operating expenses $(389) $(421)
Non-operating expenses associated with
Xpliant 354 1,144
--- -----
Total Non-GAAP non-
operating income (expense) $(35) $723
==== ====
CAVIUM, INC.
Unaudited Reconciliation of Non-GAAP Adjustments
(in thousands, except per share data and percentages)
Three Months Ended
------------------
September 30, 2015 June 30, 2015
------------------ -------------
Reconciliation of GAAP gross profit & margin
to non-GAAP:
Net revenue $105,063 $104,961
GAAP gross profit 68,860 67,288
GAAP gross margin 65.5% 64.1%
Stock-based compensation and related payroll
taxes 211 212
Amortization of acquisition related assets 157 157
Discontinued mask - 2,420
Non-GAAP gross profit $69,228 $70,077
======= =======
Non-GAAP gross margin 65.9% 66.8%
==== ====
Reconciliation of GAAP income (loss) from
operations to non-GAAP income from
operations:
GAAP income (loss) from
operations $4,971 $(5,273)
Stock-based compensation and related payroll
taxes 12,923 12,537
Amortization of acquisition related assets 3,632 3,100
Discontinued mask - 2,420
Net restructuring related expenses 395 -
Xpliant transition related expenses 971 -
Operating expenses associated with Xpliant - 11,399
--- ------
Non-GAAP income from
operations $22,892 $24,183
======= =======
Non-GAAP income from operations as a
percentage of revenue 21.8% 23.0%
==== ====
Reconciliation of GAAP income (loss) to non-
GAAP net income:
GAAP net income (loss) $4,216 $(6,355)
Non-GAAP adjustments:
Stock-based compensation and related payroll
taxes 12,923 12,537
Amortization of acquisition related assets 3,632 3,100
Discontinued mask - 2,420
Net restructuring related expenses 395 -
Xpliant transition related expenses 971 -
Operating expenses associated with Xpliant - 11,399
Non-operating expenses associated with Xpliant 354 1,144
--- -----
Total of non-GAAP adjustments 18,275 30,600
------ ------
Non-GAAP net income $22,491 $24,245
======= =======
GAAP net income (loss) per
share, diluted $0.07 $(0.11)
===== ======
Non-GAAP adjustments detailed above 0.31 0.52
Non-GAAP net income per
share, diluted $0.38 $0.41
===== =====
GAAP weighted average shares, diluted 57,457 55,507
Non-GAAP share adjustment 2,201 4,114
----- -----
Non-GAAP weighted average shares, diluted 59,658 59,621
CAVIUM, INC.
Unaudited GAAP Condensed Consolidated Balance Sheets
(in thousands)
As of As of
September 30, 2015 June 30, 2015
------------------ -------------
Assets
Current assets
Cash and cash equivalents $130,985 $121,984
Accounts receivable, net 61,696 67,165
Inventories 47,645 50,403
Prepaid expenses and other current assets 9,512 9,312
----- -----
Total current assets 249,838 248,864
Property and equipment, net 64,414 60,235
Intangible assets, net 36,954 37,023
Goodwill 71,478 71,478
Other assets 2,019 1,952
----- -----
Total assets $424,703 $419,552
======== ========
Liabilities and Stockholders' Equity
Current liabilities
Accounts payable $25,338 $32,702
Other accrued expenses and other current
liabilities 12,095 14,950
Deferred revenue 6,519 7,273
Capital lease and technology license
obligations 17,004 18,383
------ ------
Total current liabilities 60,956 73,308
Capital lease and technology license
obligations, net of current 16,092 15,981
Deferred tax liability 3,320 3,159
Other non-current liabilities 2,849 2,970
----- -----
Total liabilities 83,217 95,418
------ ------
Stockholders' equity
Common stock 56 56
Additional paid-in capital 529,812 516,676
Accumulated deficit (188,382) (192,598)
-------- --------
Total stockholders' equity 341,486 324,134
------- -------
Total liabilities and
stockholders' equity $424,703 $419,552
======== ========
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SOURCE Cavium, Inc.
