Net revenues for the first quarter of fiscal 2006 were $64.7 million compared to the $64.2 million reported in the fourth quarter of fiscal 2005 and $67.4 million reported in the first quarter of fiscal 2005.
The net loss on a GAAP basis for the first quarter of fiscal 2006 was $4.2 million or $(0.01) per share, compared with a net loss of $5.3 million or $(0.02) per share for the fourth quarter of fiscal 2005 and a net loss of $21.8 million or $(0.07) per share for the first quarter of fiscal 2005.
The pro forma net income for the first quarter of fiscal 2006 was $3.1 million or $0.01 per share, compared to the pro forma net income of $3.6 million or $0.01 per share in the fourth quarter of fiscal 2005 and the pro forma net income of $2.1 million or $0.01 per share in the first quarter of fiscal 2005.
"I'm pleased with our results for this quarter in that we delivered our third consecutive quarter of revenue growth and our second consecutive quarter of pro forma operating profitability," said Kambiz Hooshmand, President and Chief Executive Officer. "This represents my first full quarter at AMCC and I am very excited about the opportunities that lie ahead. AMCC's legacy of technical innovation remains strong. In each of our businesses, we have unique and relevant differentiators that set us apart from our competition. We are keenly focused on leveraging these strengths in the growing segments of our served markets."
AMCC reports its financial results in accordance with GAAP and additionally on a non-GAAP basis referred to as pro forma. These pro forma measures are not in accordance with, nor are they a substitute for, GAAP measures and they may not be consistent with the presentation used by other companies. AMCC uses the pro forma financial measures to evaluate and manage the Company's operations. AMCC is providing this information to investors to allow for the performance of additional financial analysis and because it is consistent with the financial models and estimates published by analysts who follow the Company.
The pro forma results exclude certain items which are required by GAAP such as restructuring costs, amortization of purchased intangibles, acquired in-process research and development charges, stock-based compensation charges related to acquired companies, litigation settlement costs and payroll tax effects of stock option exercises. Income taxes are adjusted to an estimated pro forma effective tax rate. See the attached reconciliation of the GAAP net loss to the pro forma net income, which quantifies the amounts excluded from pro forma basis results.
In addition, AMCC announced plans to restructure and reorganize its operations. The plan includes reducing approximately 5% of the current headcount by eliminating job redundancies. The company expects to incur a charge of approximately $2 million to $3 million in the second quarter of fiscal 2006 and anticipates that the restructuring plan will reduce ongoing operating expenses by approximately $1 million per quarter commencing in the third quarter of fiscal 2006.
AMCC will file a current report on Form 8-K regarding this press release with the U.S. Securities and Exchange Commission today. A copy of the filed current report will be accessible at www.sec.gov or through the company's website provided below.
For More Information
AMCC management will be holding a conference call today, July 27, 2005, at 2:00 p.m. Pacific Time/5:00 p.m. Eastern Time to discuss additional details regarding the Company's performance for the first quarter of fiscal 2006 and to provide guidance for the second quarter of fiscal 2006. You may access the conference call via any of the following:
Teleconference: 913-981-4902 Conference ID: 7924460 Web Broadcast: http://www.amcc.com Replay: 719-457-0820 (available for 7 days following the call) AMCC Overview
AMCC provides the essential building blocks for the processing, moving and storing of information worldwide. The company blends systems and software expertise with high-performance, high-bandwidth silicon integration to deliver silicon, hardware and software solutions for global wide area networks (WAN), embedded applications such as PowerPC and programmable SOC architectures, storage area networks (SAN), and high-growth storage markets such as Serial ATA (SATA) RAID. AMCC's corporate headquarters are located in San Diego, California. Sales and engineering offices are located throughout the world. For further information regarding AMCC, please visit our web site at http://www.amcc.com.
This news release contains forward-looking statements, including, but not limited to, statements regarding the company's restructuring plan, including the planned reduction of ongoing operating expenses, the anticipated amounts of restructuring costs, the impact of the reduction in force on the company's headcount, and the timetable for completion of the restructuring plan. These forward looking statements are only predictions based on current information and expectations and are subject to certain risks and uncertainties, including, but not limited to, the company's ability to implement the restructuring plan according to the timetable and to the extent currently anticipated, possible changes in the size and components of the operating expense reductions, the impact of personnel reductions on product development efforts, the company's ability to project accurately cost savings from the plan and general economic conditions. More information about potential factors that could affect the company's business and financial results is included in the "Risk Factors" set forth in the company's Annual Report on Form 10-K for the year ended March 31, 2005, and the company's subsequent filings with the Securities and Exchange Commission. Actual results could differ materially from those set forth in the forward-looking statements as a result of such risk factors as well as other risks and uncertainties.
APPLIED MICRO CIRCUITS CORPORATION CONDENSED CONSOLIDATED BALANCE SHEETS ($ in thousands) June 30, March 31, ASSETS 2005 2005 (unaudited) Current assets: Cash, cash equivalents and short- term investments $379,371 $423,392 Accounts receivable, net 23,694 28,601 Inventories 16,399 18,014 Other current assets 15,585 51,448 Total current assets 435,049 521,455 Property and equipment, net 44,668 44,461 Other assets 2,071 1,965 Goodwill and purchased intangibles 528,051 534,514 Total assets $1,009,839 $1,102,395 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable $19,747 $24,016 Other current liabilities 33,691 101,147 Current portion of long-term debt & capital leases 7 34 Total current liabilities 53,445 125,197 Stockholders' equity 956,394 977,198 Total liabilities and stockholders' equity $1,009,839 $1,102,395 APPLIED MICRO CIRCUITS CORPORATION GAAP CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited) (in thousands, except per share data) Three months ended June 30, March 31, June 30, 2005 2005 2004 Net revenues $64,673 $64,204 $67,402 Cost of revenues 30,833 30,073 31,492 Gross profit 33,840 34,131 35,910 Operating expenses: Research and development 22,974 24,562 30,990 Selling, general and administrative 15,550 14,353 14,378 Stock-based compensation: Research and development 696 708 1,032 Selling, general and administrative 785 763 1,323 Amortization of purchased intangibles 1,267 1,608 1,557 Acquired in-process research and development -- -- 13,400 Restructuring charges -- 1,233 -- Litigation settlement, net -- 350 -- Total operating expenses 41,272 43,577 62,680 Operating loss (7,432) (9,446) (26,770) Interest and other income, net 3,404 4,108 5,281 Loss before income taxes (4,028) (5,338) (21,489) Income tax expense 176 -- 335 Net loss $(4,204) $(5,338) $(21,824) Basic and diluted loss per share: Loss per share $(0.01) $(0.02) $(0.07) Shares used in calculating basic and diluted loss per share 306,327 308,448 311,519 APPLIED MICRO CIRCUITS CORPORATION PRO FORMA CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited) (in thousands, except per share data) Three months ended June 30, March 31, June 30, 2005 2005 2004 Net revenues $64,673 $64,204 $67,402 Cost of revenues 25,611 24,833 24,635 Gross profit 39,062 39,371 42,767 Operating expenses: Research and development 22,974 24,555 30,990 Selling, general and administrative 15,550 14,350 14,376 Total operating expenses 38,524 38,905 45,366 Operating income (loss) 538 466 (2,599) Interest and other income, net 3,404 4,108 5,281 Income before income taxes 3,942 4,574 2,682 Income tax expense 867 1,006 590 Net income $3,075 $3,568 $2,092 Diluted income per share: Income per share $0.01 $0.01 $0.01 Shares used in calculating diluted income per share 307,357 310,420 318,327