First Quarter 2015 Financial Highlights*:
- Lattice closed its acquisition of Silicon Image on March 10, 2015. Financial results reflect the inclusion of Silicon Image's results subsequent to the acquisition date, acquisition and restructuring related expenses, and debt related costs.
- Revenue of $88.6 million on a GAAP basis and $90.4 million on a non-GAAP basis.
- Net loss of $53.3 million or $0.46 per basic and diluted share on a GAAP basis, compared to net income of $3.9 million or $0.03 per basic and diluted share on a non-GAAP basis. GAAP results reflect $4.9 million in restructuring costs, $18.2 million in acquisition related charges, a $24.7 million tax provision, $2.9 million in amortization of acquired intangibles and $3.4 million in stock based compensation expense.
- Gross margin of 54% on a GAAP basis and 57.8% on a non-GAAP basis.
* For a reconciliation of GAAP to non-GAAP results, see accompanying tables "Reconciliation of U.S. GAAP to Non-GAAP Financial Measures."
PORTLAND, Ore. — (BUSINESS WIRE) — May 4, 2015 — Lattice Semiconductor Corporation (NASDAQ: LSCC), the global leader in smart connectivity solutions, announced financial results today for the fiscal first quarter ended April 4, 2015.
For the first quarter, revenue was $88.6 million on a GAAP basis and $90.4 million on a non-GAAP basis, as compared to $83.6 million and $96.6 million in the prior quarter and year ago period, respectively on both a GAAP and a non-GAAP basis.
Net loss for the first quarter on a GAAP basis was $53.3 million ($0.46 per basic and diluted share), with first quarter net income on a non-GAAP basis of $3.9 million ($0.03 per basic and diluted share). GAAP results for the first quarter of 2015 reflect $4.9 million in restructuring costs, $18.2 million in acquisition related charges, a $24.7 million tax provision, $2.9 million in amortization of acquired intangibles and $3.4 million in stock based compensation expense. This compares to net income on a GAAP basis in the prior quarter of $15.4 million ($0.13 per basic and diluted share), or $8.3 million ($0.07 per basic and diluted share) on a non-GAAP basis; and compares to net income on a GAAP basis in the year ago period of $12.0 million ($0.10 per basic and diluted share), or $17.2 million ($0.15 per basic and $0.14 per diluted share) on a non-GAAP basis.
Darin G. Billerbeck, President and Chief Executive Officer, said, "We are modeling mid-point revenue of approximately $485 million on a non-GAAP basis for the full year 2015, with our recent acquisition of Silicon Image, and will continue to work to achieve above industry average growth. This is after growing revenue from $279 million for the full year 2012 to $333 million in 2013 and to $366 million in 2014. In addition to delivering continued above market revenue growth, our focus is on achieving 20% operating income on a non-GAAP basis at any revenue level, and doubling our earnings per share on an annualized non-GAAP basis over the next two years. With the acquisition of Silicon Image, we have diversified our Consumer market growth opportunities, while reducing our reliance on any one customer. Our business outlook for the second half of the year remains optimistic based on continued growth in our new consumer initiatives and modest growth in the industrial market that should offset a sluggish communications market. We expect to end 2015 in an even stronger position as we achieve our synergy goals."
Joe Bedewi, Corporate Vice President and Chief Financial Officer, added, "We are moving aggressively to integrate and consolidate our transformational acquisition of Silicon Image, which closed in March. We expect to see the benefits of our synergy actions in the current second quarter, with the balance coming as we move through 2015. In connection with our acquisition, we issued $350 million in term debt, which is shown on our balance sheet net of related financing costs. Our targeted cost synergies are now approximately $42 million, as we have uncovered new opportunities for increased organizational efficiencies. The efficiencies can be achieved without adversely impacting our customers or our product roadmap. This target is 30% higher than our initial target of $32 million and is also above our revised target of approximately $36 million. We plan to drive free cash flow and actively reduce debt, as we continue building value for our shareholders through an effective growth and capital allocation strategy, and the use of our balance sheet."
Recent Business Highlights
- Lattice Closed its Acquisition of Silicon Image; Creates Global Leader in Wired and Wireless Connectivity Solutions: Full details of the acquisition, the tender offer and closing conditions are detailed in the press release issued on March 11, 2015 and in the Company’s filings with the U.S. Securities and Exchange Commission.
- Partners with NYU Wireless to Advance Wireless 5G Technologies: Lattice Semiconductor's SiBEAM joined NYU's research center as an industrial-affiliate sponsor of fundamental research that is creating the next generation of wireless technologies, also known as 5G.
- Develops Industry First Miracast HDCP Protocol Analyzer: Lattice Semiconductor's Simplay™ Labs, LLC, the leading provider of standards compliance and interoperability testing services for consumer electronics (CE) and mobile devices, announced that its SL-8810 Miracast HDCP 2.2 test tool is being evaluated by Digital Content Protection (DCP) LLC as the Authorized Test Tool for High-bandwidth Digital Content Protection (HDCP) 2.2 Interface Independent Adaptation (IIA) Compliance Testing. Upon successfully completing the evaluation process, the SL-8810 will be the industry’s first test tool for HDCP 2.2 IIA Compliance Testing for Miracast products.
- Introduces Industry's First USB TYPE-C Port Controllers with MHL ALT Mode: Lattice Semiconductor's Silicon Image launched the SiI7023 and SiI7033, the industry’s first single-chip USB Type-C port controllers that include MHL ® Alternate Mode for the USB Type-C specification, as well as port configuration switches. These ICs have a fully integrated USB Type-C communication transceiver, adhering to the Power Delivery and Configuration Channel requirements defined in the USB Type-C related specifications. Device manufacturers can utilize these new port controllers with integrated switches in order to deliver brilliant MHL 4K Ultra HD video, immersive audio, power, and data over the USB Type-C connector.