|By Business Wire||
|November 8, 2012 04:15 PM EST||
TranSwitch Corporation (NASDAQ: TXCC), a leading provider of semiconductor solutions for multimedia connectivity and processing today announced financial results for the third quarter ended September 30, 2012.
Net revenues for the third quarter of 2012 were approximately $4.8 million, as compared to net revenues of $3.8 million for the second quarter of 2012 and $6.7 million for the third quarter of 2011. Net loss for the third quarter of 2012 was ($3.0) million, or ($0.09) per basic and diluted common share, as compared to a net loss of ($6.0) million, or ($0.19) per basic and diluted common share for the second quarter of 2012, and a net loss of ($4.8) million, or ($0.16) per basic and diluted common share for the third quarter of 2011.
The GAAP gross margin for the third quarter was 64%. This is compared to the Company's GAAP gross margin of 67% for the second quarter of 2012, and 65% for the third quarter of 2011.
Total non-GAAP operating expenses for the third quarter of 2012 were $5.7 million, as compared to $7.4 million in the second quarter of 2012 and $7.4 million in the third quarter of 2011. Non-GAAP operating expenses for the third quarter of 2012 exclude $0.1 million in amortization of purchase price intangibles and $0.5 million in stock-based compensation along with a benefit of $0.3 million from the reversal of accrued royalties. Total GAAP operating expenses for the third quarter of 2012 were $6.0 million, as compared to $8.5 million in the second quarter of 2012 and $8.8 million in the third quarter of 2011.
Non-GAAP operating loss for the third quarter of 2012 was ($2.7) million, compared to a non-GAAP operating loss of ($4.9) million for the second quarter of 2012 and a non-GAAP operating loss of ($3.1) million for the third quarter of 2011. On a GAAP basis, the operating loss for the third quarter of 2012 was ($2.9) million, compared to an operating loss of ($5.9) million for the second quarter of 2012 and an operating loss of ($4.5) million for the third quarter of 2011.
Non-GAAP net loss for the third quarter of 2012 was ($2.7) million, or ($0.08) per share, compared with a non-GAAP net loss of ($5.0) million, or ($0.16) per share, for the second quarter of 2012 and a non-GAAP net loss of ($3.3) million, or ($0.11) per share, for the third quarter of 2011.
Further information about non-GAAP measures is provided below and a reconciliation of the non-GAAP measures to the comparable GAAP results is provided after the financial statements attached to this release.
“We made meaningful progress in the third quarter toward our business objectives,” stated Dr. M. Ali Khatibzadeh, President and CEO of TranSwitch Corporation. “In addition to 24% quarterly sequential revenue growth driven by IP licensing opportunities and increased royalty revenue, we achieved significant on-going reductions in expenses due to the restructuring plan we initiated earlier in the quarter. On the new video connectivity business front, we passed an important milestone of initial production shipments of HDplay™ product for our first customer who also plans to incorporate HDplay™ in new products. In addition, we are making progress securing new customers from an expanding list of opportunities and anticipate additional customers reaching production ramp in the fourth quarter and as we move into 2013. Overall, through the combination of an increased backlog of telecom products, IP licensing opportunities, royalty revenue and ramp of HDplay™ product, we are targeting further sequential growth in the fourth quarter. With regard to improving our balance sheet, as we have previously announced, our primary plan is the sale of telecom patents. We are making tangible progress towards the sale of our patents and anticipate completing a transaction by the end of the year.”
Additional details on TranSwitch’s third quarter 2012 financial results will be discussed during a conference call regarding this announcement today at 5:30 pm Eastern time. To listen to the live call, investors can dial 719-325-2484 and reference confirmation code: 2054387. The call will be recorded and a replay will be available two hours after the conclusion of the live broadcast through November 18, 2012. To access the replay, dial 719-457-0820 and enter confirmation code: 2054387. Investors can also access an audio webcast which will be broadcast through Vcall’s Investor Calendar at www.investorcalendar.com or the Company’s website at www.transwitch.com. This audio webcast will also be available on a replay basis for 10 business days.
About TranSwitch Corporation
TranSwitch Corporation (Nasdaq:TXCC) provides innovative integrated circuit (IC) and intellectual property (IP) solutions that deliver core functionality for video, voice, and data communications equipment for the customer premises and network infrastructure markets. For the customer-premises market, we offer multi-standard, high-speed interconnect solutions enabling the distribution and presentation of high-definition (HD) video and data content for consumer electronics applications. We also provide a family of best-in-class communications processors. For the network infrastructure market we provide integrated multi-core network processor System-on-a-Chip (SoC) solutions for Fixed, 3G and 4G Mobile, VoIP and Multimedia applications. TranSwitch’s customers are leading consumer electronics and telecom equipment companies around the globe. For more information, please visit www.transwitch.com or follow us at Facebook or Twitter.
Forward-looking statements in this release, including statements regarding management's expectations for future financial results and the markets for TranSwitch's products, are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Investors are cautioned that these forward-looking statements regarding TranSwitch, its operations and its financial results, involve risks and uncertainties that could cause actual results to differ materially from those contained in the forward-looking statements, including without limitation the risks associated with downturns in economic conditions generally and in the telecommunications and data communications markets and the semiconductor industry specifically; risks in product development and market acceptance of and demand for TranSwitch’s products and products developed by TranSwitch’s customers; risks associated with foreign sales and high customer concentration; risks associated with competition and competitive pricing pressures; risks in technology development and commercialization; risks of failing to attract and retain key managerial and technical personnel; risks relating to TranSwitch’s available cash; risks associated with acquiring new businesses; risks of dependence on third-party VLSI fabrication facilities; risks related to intellectual property rights and litigation; and other risks detailed in TranSwitch's filings with the Securities and Exchange Commission.
TranSwitch expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any such statements to reflect any change in expectations or any change in events, conditions or circumstances on which any such statement is based.
TranSwitch is a registered trademark of TranSwitch Corporation.
Reconciliation of Non-GAAP Financial Measures to Comparable U.S. GAAP Measures (Unaudited)
Pursuant to the requirements of Regulation G, the Company has provided a reconciliation of each non-GAAP financial measure used in this earnings release and related conference call or webcast to the most directly comparable financial measure prepared in accordance with accounting principles generally accepted in the United States (“GAAP”). The reconciliation for historic non-GAAP measures is provided herein on a quantitative basis and for non-GAAP measures that are forward-looking is provided herein on a qualitative basis.
The non-GAAP measures used in this earnings release and related conference call differ from GAAP in that they exclude expenses related to stock-based compensation, amortization of intangible assets, the effects of special charges such as asset impairments, restructuring charges and benefits from the reversal of accrued royalties. The Company’s basis for these adjustments is described below. Management uses these non-GAAP measures for internal reporting and forecasting purposes. The Company has provided these non-GAAP financial measures in addition to GAAP financial results because it believes that these non-GAAP financial measures provide useful information to certain investors and financial analysts for comparison across accounting periods not influenced by certain non-cash items that are not used by management when evaluating the Company’s historical and prospective financial performance.
Management uses these non-GAAP financial measures when evaluating the Company’s operating performance and believes that such measures are useful to investors and financial analysts in assessing the Company’s operating performance as the Company believes that the presentation of non-GAAP measures that adjust for the impact of stock-based compensation expenses, amortization of intangible assets, the effects of special charges such as asset impairments and restructuring charges and benefits from the reversal of accrued royalties provides investors and financial analysts with a consistent basis for comparison across accounting periods and, therefore, are useful to investors and financial analysts in helping them to better understand the Company’s operating results and underlying operational trends.
We do not provide forward-looking GAAP measures or a reconciliation of the forward-looking non-GAAP measures to GAAP measures because of our inability to project special charges, asset impairments, employee separation costs and stock-based compensation related expenses.
The non-GAAP financial measures we provide have certain limitations because they do not reflect all of the costs associated with the operation of our business as determined in accordance with GAAP. The non-GAAP measures are in addition to, and not a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP and may be different from non-GAAP measures used by other companies. We endeavor to compensate for the limitations of these non-GAAP measures by providing GAAP financial statements, descriptions of the reconciling items and a reconciliation of the non-GAAP measures to the most directly comparable GAAP measures so that investors can appropriately incorporate the non-GAAP measures and their limitations into their analyses. Please see our financial statements and "Management's Discussion and Analysis of Results of Operations and Financial Condition" that will be included in the periodic report we expect to file with the SEC with respect to the financial periods discussed herein.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except for per share amounts)
|Three Months Ended||Nine Months Ended|
|Intellectual property and service revenues||3,121||1,451||1,810||5,091||7,263|
|Total net revenues||4,752||3,825||6,665||12,258||21,945|
|Cost of revenues:|
|Cost of product revenues||694||866||1,425||2,679||4,510|
|Provision for excess and obsolete inventories||154||220||26||605||186|
|Cost of service revenues||844||175||917||1,180||2,955|
|Total cost of revenues||1,692||1,261||2,368||4,464||7,651|
|Research and development||3,325||4,678||4,672||12,339||13,727|
|Marketing and sales||1,144||1,317||1,772||4,103||5,836|
|General and administrative||1,851||1,930||1,925||5,913||5,699|
|Reversal of accrued royalties||(332||)||(442||)||(455||)||(832||)||(2,030||)|
|Total operating expenses||5,988||8,484||8,838||22,524||24,623|
|Operating loss (Note 1)||(2,928||)||(5,920||)||(4,541||)||(14,730||)||(10,329||)|
|Other (expense) income:|
|Other income (expense)||41||57||23||(3||)||10|
|Interest income (expense):|
|Interest (expense) income, net||(5||)||(15||)||(36||)||(6||)||(137||)|
|Total other income (expense), net||36||42||(13||)||(9||)||(127||)|
|Loss before income taxes||(2,892||)||(5,878||)||(4,554||)||(14,739||)||(10,456||)|
|Income tax expense||108||119||233||341||479|
|Net loss per common share – basic and diluted||$||(0.09||)||$||(0.19||)||$||(0.16||)||$||(0.47||)||$||(0.40||)|
|Weighted average common shares outstanding – basic and diluted||34,269||31,617||30,475||32,198||27,019|
Note 1: Stock-based compensation expense included in cost of
|Cost of revenues||$||8||$||(14||)||$||11||$||—||$||48|
|Research and development||147||78||195||345||624|
|Marketing and sales||93||39||111||243||361|
|General and administrative||259||283||286||837||903|
CONDENSED CONSOLIDATED BALANCE SHEETS
|Cash, cash equivalents, restricted cash and short-term investments||$||1,607||$||7,554|
|Accounts receivable, net||4,295||6,375|
|Prepaid expenses and other current assets||1,808||1,876|
|Total current assets||9,093||17,793|
|Property and equipment, net||1,153||1,355|
|Other intangible assets, net||1,228||1,461|
|LIABILITIES AND STOCKHOLDERS’ EQUITY|
|Accounts payable, accrued expenses and other current liabilities||10,170||10,932|
|Current portion of restructuring liabilities||2,093||1,995|
|Total current liabilities||13,205||12,927|
|Total stockholders’ equity||3,692||12,206|
|Total liabilities and stockholders’ equity||$||18,673||$||27,618|
|Supplemental Reconciliation of GAAP Results to Non-GAAP|
|(In thousands, except per share data)|
|Three Months Ended||Nine Months Ended|
|Sep 30,||Jun 30,||Sep 30,||Sep 30,||Sep 30,|
|GAAP gross profit||$||3,060||$||2,564||$||4,297||$||7,794||$||14,294|
|Non-GAAP gross profit||$||3,068||$||2,550||$||4,308||$||7,794||$||14,342|
|GAAP gross margin||64.4%||67.0%||64.5%||63.6%||65.1%|
|Non-GAAP gross margin||64.6%||66.7%||64.6%||63.6%||65.4%|
|GAAP research and development expenses||$||3,325||$||4,678||$||4,672||$||12,339||$||13,727|
|Amortization of purchase accounting intangibles||38||42||114||115||340|
|Non-GAAP research and development expenses||$||3,140||$||4,558||$||4,363||$||11,879||$||12,763|
|GAAP selling, general, and administrative expenses||$||2,995||$||3,247||$||3,697||$||10,016||$||11,535|
|Amortization of purchase accounting intangibles||39||36||283||118||849|
|Non-GAAP selling, general, and administrative expenses||$||2,604||$||2,889||$||3,017||$||8,818||$||9,422|
|GAAP operating expenses||$||5,988||$||8,484||$||8,838||$||22,524||$||24,623|
|Amortization of purchase accounting intangibles||77||78||397||233||1,189|
|Reversal of accrued royalties and other||(332)||(442)||(455)||(832)||(2,030)|
|Non-GAAP operating expenses||$||5,744||$||7,447||$||7,380||$||20,697||$||22,185|
|Non-GAAP operating loss||$||(2,676)||$||(4,897)||$||(3,072)||$||(12,903)||$||(7,843)|
|GAAP net loss||$||(3,000)||$||(5,997)||$||(4,787)||$||(15,080)||$||(10,935)|
|Amortization of purchase accounting intangibles||77||78||397||233||1,189|
|Reversal of accrued royalties and other||(332)||(442)||(455)||(832)||(2,030)|
|Non-GAAP net loss||$||(2,748)||$||(4,974)||$||(3,318)||$||(13,253)||$||(8,449)|
|Non-GAAP basic net loss per share||$||(0.08)||$||(0.16)||$||(0.11)||$||(0.41)||$||(0.31)|
|Basic shares used to calculate non-GAAP net loss per share||34,269||31,617||30,475||32,198||27,019|
SYS-CON Events announced today that Interoute, owner-operator of one of Europe's largest networks and a global cloud services platform, has been named “Bronze Sponsor” of SYS-CON's 20th Cloud Expo, which will take place on June 6-8, 2017 at the Javits Center in New York, New York. Interoute is the owner-operator of one of Europe's largest networks and a global cloud services platform which encompasses 12 data centers, 14 virtual data centers and 31 colocation centers, with connections to 195 add...
Mar. 30, 2017 10:30 AM EDT Reads: 1,869
SYS-CON Events announced today that Cloudistics, an on-premises cloud computing company, has been named “Bronze Sponsor” of SYS-CON's 20th International Cloud Expo®, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY. Cloudistics delivers a complete public cloud experience with composable on-premises infrastructures to medium and large enterprises. Its software-defined technology natively converges network, storage, compute, virtualization, and management into a ...
Mar. 30, 2017 10:15 AM EDT Reads: 2,435
SYS-CON Events announced today that SD Times | BZ Media has been named “Media Sponsor” of SYS-CON's 20th International Cloud Expo, which will take place on June 6–8, 2017, at the Javits Center in New York City, NY. BZ Media LLC is a high-tech media company that produces technical conferences and expositions, and publishes a magazine, newsletters and websites in the software development, SharePoint, mobile development and commercial UAV markets.
Mar. 30, 2017 10:00 AM EDT Reads: 4,550
"I think that everyone recognizes that for IoT to really realize its full potential and value that it is about creating ecosystems and marketplaces and that no single vendor is able to support what is required," explained Esmeralda Swartz, VP, Marketing Enterprise and Cloud at Ericsson, in this SYS-CON.tv interview at @ThingsExpo, held June 7-9, 2016, at the Javits Center in New York City, NY.
Mar. 30, 2017 08:00 AM EDT Reads: 4,587
Why do your mobile transformations need to happen today? Mobile is the strategy that enterprise transformation centers on to drive customer engagement. In his general session at @ThingsExpo, Roger Woods, Director, Mobile Product & Strategy – Adobe Marketing Cloud, covered key IoT and mobile trends that are forcing mobile transformation, key components of a solid mobile strategy and explored how brands are effectively driving mobile change throughout the enterprise.
Mar. 30, 2017 06:00 AM EDT Reads: 3,172
My team embarked on building a data lake for our sales and marketing data to better understand customer journeys. This required building a hybrid data pipeline to connect our cloud CRM with the new Hadoop Data Lake. One challenge is that IT was not in a position to provide support until we proved value and marketing did not have the experience, so we embarked on the journey ourselves within the product marketing team for our line of business within Progress. In his session at @BigDataExpo, Sum...
Mar. 30, 2017 04:45 AM EDT Reads: 3,392
Keeping pace with advancements in software delivery processes and tooling is taxing even for the most proficient organizations. Point tools, platforms, open source and the increasing adoption of private and public cloud services requires strong engineering rigor - all in the face of developer demands to use the tools of choice. As Agile has settled in as a mainstream practice, now DevOps has emerged as the next wave to improve software delivery speed and output. To make DevOps work, organization...
Mar. 30, 2017 04:15 AM EDT Reads: 2,289
SYS-CON Events announced today that MobiDev, a client-oriented software development company, will exhibit at SYS-CON's 20th International Cloud Expo®, which will take place June 6-8, 2017, at the Javits Center in New York City, NY, and the 21st International Cloud Expo®, which will take place October 31-November 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. MobiDev is a software company that develops and delivers turn-key mobile apps, websites, web services, and complex softw...
Mar. 30, 2017 02:15 AM EDT Reads: 4,189
DevOps is often described as a combination of technology and culture. Without both, DevOps isn't complete. However, applying the culture to outdated technology is a recipe for disaster; as response times grow and connections between teams are delayed by technology, the culture will die. A Nutanix Enterprise Cloud has many benefits that provide the needed base for a true DevOps paradigm.
Mar. 30, 2017 01:30 AM EDT Reads: 2,676
What sort of WebRTC based applications can we expect to see over the next year and beyond? One way to predict development trends is to see what sorts of applications startups are building. In his session at @ThingsExpo, Arin Sime, founder of WebRTC.ventures, will discuss the current and likely future trends in WebRTC application development based on real requests for custom applications from real customers, as well as other public sources of information,
Mar. 30, 2017 01:15 AM EDT Reads: 1,300
China Unicom exhibit at the 19th International Cloud Expo, which took place at the Santa Clara Convention Center in Santa Clara, CA, in November 2016. China United Network Communications Group Co. Ltd ("China Unicom") was officially established in 2009 on the basis of the merger of former China Netcom and former China Unicom. China Unicom mainly operates a full range of telecommunications services including mobile broadband (GSM, WCDMA, LTE FDD, TD-LTE), fixed-line broadband, ICT, data communica...
Mar. 30, 2017 12:15 AM EDT Reads: 3,677
SYS-CON Events announced today that Ocean9will exhibit at SYS-CON's 20th International Cloud Expo®, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY. Ocean9 provides cloud services for Backup, Disaster Recovery (DRaaS) and instant Innovation, and redefines enterprise infrastructure with its cloud native subscription offerings for mission critical SAP workloads.
Mar. 29, 2017 09:30 PM EDT Reads: 2,512
Things are changing so quickly in IoT that it would take a wizard to predict which ecosystem will gain the most traction. In order for IoT to reach its potential, smart devices must be able to work together. Today, there are a slew of interoperability standards being promoted by big names to make this happen: HomeKit, Brillo and Alljoyn. In his session at @ThingsExpo, Adam Justice, vice president and general manager of Grid Connect, will review what happens when smart devices don’t work togethe...
Mar. 29, 2017 06:30 PM EDT Reads: 2,807
SYS-CON Events announced today that SoftLayer, an IBM Company, has been named “Gold Sponsor” of SYS-CON's 18th Cloud Expo, which will take place on June 7-9, 2016, at the Javits Center in New York, New York. SoftLayer, an IBM Company, provides cloud infrastructure as a service from a growing number of data centers and network points of presence around the world. SoftLayer’s customers range from Web startups to global enterprises.
Mar. 29, 2017 03:15 PM EDT Reads: 2,344
SYS-CON Events announced today that Auditwerx will exhibit at SYS-CON's 20th International Cloud Expo®, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY. Auditwerx specializes in SOC 1, SOC 2, and SOC 3 attestation services throughout the U.S. and Canada. As a division of Carr, Riggs & Ingram (CRI), one of the top 20 largest CPA firms nationally, you can expect the resources, skills, and experience of a much larger firm combined with the accessibility and attent...
Mar. 29, 2017 02:30 PM EDT Reads: 899
SYS-CON Events announced today that CA Technologies has been named “Platinum Sponsor” of SYS-CON's 20th International Cloud Expo®, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY, and the 21st International Cloud Expo®, which will take place October 31-November 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. CA Technologies helps customers succeed in a future where every business – from apparel to energy – is being rewritten by software. From ...
Mar. 29, 2017 02:30 PM EDT Reads: 2,386
SYS-CON Events announced today that Technologic Systems Inc., an embedded systems solutions company, will exhibit at SYS-CON's @ThingsExpo, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY. Technologic Systems is an embedded systems company with headquarters in Fountain Hills, Arizona. They have been in business for 32 years, helping more than 8,000 OEM customers and building over a hundred COTS products that have never been discontinued. Technologic Systems’ pr...
Mar. 29, 2017 02:30 PM EDT Reads: 3,946
SYS-CON Events announced today that HTBase will exhibit at SYS-CON's 20th International Cloud Expo®, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY. HTBase (Gartner 2016 Cool Vendor) delivers a Composable IT infrastructure solution architected for agility and increased efficiency. It turns compute, storage, and fabric into fluid pools of resources that are easily composed and re-composed to meet each application’s needs. With HTBase, companies can quickly prov...
Mar. 29, 2017 02:15 PM EDT Reads: 3,399
SYS-CON Events announced today that Loom Systems will exhibit at SYS-CON's 20th International Cloud Expo®, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY. Founded in 2015, Loom Systems delivers an advanced AI solution to predict and prevent problems in the digital business. Loom stands alone in the industry as an AI analysis platform requiring no prior math knowledge from operators, leveraging the existing staff to succeed in the digital era. With offices in S...
Mar. 29, 2017 01:30 PM EDT Reads: 1,852
Buzzword alert: Microservices and IoT at a DevOps conference? What could possibly go wrong? In this Power Panel at DevOps Summit, moderated by Jason Bloomberg, the leading expert on architecting agility for the enterprise and president of Intellyx, panelists peeled away the buzz and discuss the important architectural principles behind implementing IoT solutions for the enterprise. As remote IoT devices and sensors become increasingly intelligent, they become part of our distributed cloud enviro...
Mar. 29, 2017 12:15 PM EDT Reads: 8,041