Net revenues in the first quarter of 2009 were $102.6 million, a decrease of 18% compared with the first quarter of 2008 and 15% lower than the $120.8 million in the fourth quarter of 2008.
Net loss in the first quarter of 2009 on a GAAP basis was $3.9 million (GAAP loss per share of $0.02) compared with a GAAP net loss in the first quarter of 2008 of $20.9 million (GAAP loss per share of $0.10). Non-GAAP net income in the first quarter of 2009 was $12.4 million (non-GAAP diluted earnings per share of $0.06) compared with non-GAAP net income of $23.6 million (non-GAAP diluted earnings per share of $0.11) in the first quarter of 2008.
“In the first quarter of 2009, we experienced strong demand for our wireless and wireline communications products in China,” said Greg Lang, president and chief executive officer of PMC-Sierra. “We lowered operating expenses during the first quarter and will maintain our focus on keeping our operating expenses in line with our business opportunities.”
Net income on a non-GAAP basis in the first quarter of 2009 excludes the following items: (i) $9.8 million amortization of purchased intangible assets; (ii) $5.5 million stock-based compensation expense; (iii) $3.6 million foreign exchange gain on a foreign tax liability; (iv) $1.9 million termination costs; (v) $0.7 million of non-cash interest expense for the accretion of the debt discount related to the senior convertible notes; (vi) $0.5 million loss on subleased facilities; (vii) $0.3 million restructuring costs; (viii) $1.0 million income tax provision, which includes $0.9 million deferred tax recovery relating to foreign exchange translation of a foreign subsidiary, and other items.
For a full reconciliation of GAAP net loss to non-GAAP net income, please refer to the schedule included with this release. The Company believes the additional non-GAAP measures are useful to investors for the purpose of financial analysis. Management uses the non-GAAP measures internally to evaluate its in-period operating performance before gains, losses and other charges that are considered by management to be outside of the Company’s core operating results. In addition, the measures are used to plan for the Company’s future periods. However, non-GAAP measures are neither stated in accordance with, nor are they a substitute for, GAAP measures.
The Company made the following announcements in Q1 2009:
First Quarter 2009 Conference Call
Management will review the first quarter 2009 results and provide guidance for the second quarter of 2009 during a conference call at 1:30 p.m. Pacific Time/4:30 p.m. Eastern Time on April 23, 2009. The conference call webcast will be accessible under the Financial Events and Calendar section at http://investor.pmc-sierra.com/. To listen to the conference call live by telephone, dial 416-642-5212 approximately ten minutes before the start time. A telephone playback will be available after the completion of the call and can be accessed at 647-436-0148 using the access code 6259245. A replay of the webcast will be available for five business days.
Second Quarter 2009 Conference Call
PMC-Sierra is planning on releasing its results for the second quarter of 2009 on July 23, 2009. A conference call will be held on the day of the release to review the quarter and provide an outlook for the third quarter of 2009.
Safe Harbor Statement
PMC-Sierra’s forward-looking statements are subject to risks and uncertainties. Actual results may differ from these projections. The Company’s SEC filings describe more fully the risks associated with the Company’s business including PMC-Sierra’s limited revenue visibility due to variable customer demands, market segment growth or decline, orders with short delivery lead times, customer concentration, and other items such as foreign exchange rates. The Company does not undertake any obligation to update the forward-looking statements.