-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, A9TBpIbyJVjYcmmKMtg5AuE9O/sWqD0mFCVVzu/eSuXErNqMGLbEYQ5Tp2yF+Tnj ErAmogxH9wM/q3HxoKqUdQ== 0001157523-06-010790.txt : 20061102 0001157523-06-010790.hdr.sgml : 20061102 20061102165530 ACCESSION NUMBER: 0001157523-06-010790 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20061102 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20061102 DATE AS OF CHANGE: 20061102 FILER: COMPANY DATA: COMPANY CONFORMED NAME: IMMERSION CORP CENTRAL INDEX KEY: 0001058811 STANDARD INDUSTRIAL CLASSIFICATION: COMPUTER PERIPHERAL EQUIPMENT, NEC [3577] IRS NUMBER: 943180138 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-27969 FILM NUMBER: 061183408 BUSINESS ADDRESS: STREET 1: 801 FOX LANE CITY: SAN JOSE STATE: CA ZIP: 95131 BUSINESS PHONE: 4084671900 MAIL ADDRESS: STREET 1: 801 FOX LANE CITY: SAN JOSE STATE: CA ZIP: 95131 FORMER COMPANY: FORMER CONFORMED NAME: IMMERSION HUMAN INTERFACE CORP DATE OF NAME CHANGE: 19980602 8-K 1 a5265196.txt IMMERSION CORPORATION 8-K UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ---------------------- FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report (Date of earliest event reported): November 2, 2006 IMMERSION CORPORATION (Exact name of registrant as specified in its charter) ---------------------- Delaware 000-27969 94-3180138 (State or other jurisdiction (Commission File Number) (IRS Employer of incorporation) Identification No.) ---------------------- 801 Fox Lane San Jose, California 95131 (Address of principal executive offices) (Zip Code) ---------------------- Registrant's telephone number, including area code: (408) 467-1900 Not Applicable (Former name or former address, if changed since last report) Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions: [ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) [ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) [ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) [ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) Item 2.02 Results of Operations and Financial Condition. The information in this Current Report on Form 8-K and the Exhibit attached hereto shall not be deemed to be "filed" for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section or Sections 11 or 12(a)(2) of the Securities Act of 1933, as amended. The information contained herein and in the accompanying Exhibit shall not be deemed to be incorporated by reference into any filing with the Securities and Exchange Commission (the "SEC") made by Immersion Corporation ("Immersion") whether before or after the date hereof, regardless of any general incorporation language in such filing, unless expressly incorporated by specific reference in such filing. On November 2, 2006, Immersion issued a press release (the "Press Release") announcing Immersion's financial results for the quarter ended September 30, 2006. A copy of the Press Release is attached as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated herein by reference. Item 9.01 Financial Statements and Exhibits. (d) Exhibits. Exhibit No. Description ----------- ----------- 99.1 Press Release dated November 2, 2006 regarding financial information for Immersion for the quarter ended September 30, 2006. Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. IMMERSION CORPORATION Date: November 2, 2006 By: /s/ Stephen M. Ambler ---------------------------------- Stephen M. Ambler Chief Financial Officer and Vice President, Finance EXHIBIT INDEX ------------- Exhibit No. Description - ----------- ----------- 99.1 Press Release dated November 2, 2006 regarding financial information for Immersion for the quarter ended September 30, 2006. EX-99.1 2 a5265196ex99_1.txt EXHIBIT 99.1 Exhibit 99.1 Immersion Corporation Reports Third Quarter 2006 Financial Results SAN JOSE, Calif.--(BUSINESS WIRE)--Nov. 2, 2006--Immersion Corporation, (Nasdaq:IMMR), a leading developer and licensor of touch feedback technology, today announced its third quarter 2006 financial results. Revenues were $6.6 million for the quarter ended September 30, 2006 compared to revenues of $5.4 million for the third quarter of 2005. Net loss on a Generally Accepted Accounting Principles (GAAP) basis for the third quarter of 2006 was $3.2 million, or $0.13 per share, down 24 percent compared to a net loss on a GAAP basis of $4.2 million, or $0.17 per share, for the third quarter of 2005. Net loss for the three months ended September 30, 2006 included stock-based compensation expense of $724,000, equal to $0.03 loss per share. Net loss for the three months ended September 30, 2005 did not include any stock-based compensation expense. As of September 30, 2006, Immersion had cash and cash equivalents totaling $29.0 million as compared to $30.9 million as of June 30, 2006. Revenues were $19.2 million for the nine months ended September 30, 2006 compared to revenues of $17.4 million for the first nine months of 2005. Net loss on a GAAP basis for the first nine months of 2006 was $8.4 million, or $0.34 per share, down 17 percent compared to a net loss on a GAAP basis of $10.1 million, or $0.42 per share, for the first nine months of 2005. "The third quarter revenue increase was led by 35 percent growth in non-gaming revenues, notably from medical and touch interface products," said Victor Viegas, Immersion CEO and president. "Gaming revenues from our third-party peripheral licensees declined 28 percent, as expected. Our overall 22 percent revenue growth over revenues in the third quarter last year demonstrates increasing demand for our haptics technology for many diverse applications. "Medical simulation continues to gain wider acceptance as an effective training tool, which is driving interest in the acquisition of our simulation systems by teaching institutions and medical device manufacturers. In response, Immersion Medical has broadened its sales coverage, increased its distribution reach, and maintained its strong relationship with Medtronic, Inc. In addition, the new strategic relationship with Laerdal Medical A/S, announced in August, has expanded the distribution channel for vascular access products worldwide and is already contributing to our revenue growth. Medical revenue increased 64 percent compared to the year ago quarter and 41 percent year-to-date compared to the same period in 2005. "We continue to gain support for our VibeTonz(R) technology in Korea, an early adoption proving ground for mobile technologies. We now have relationships with the top three handset makers and the top two operators or their content aggregators in Korea. Recently we established an important new affiliation with Korea Telecom Freetel (KTF), the second largest operator in Korea with 13 million subscribers. Through an Immersion agreement with content aggregator GeoTel, KTF subscribers will now have access to VibeTonz-enabled games, music, video, messaging, and other content and services. Earlier in the third quarter, we announced that our licensee SK Telecom, Korea's number one mobile operator with 20 million subscribers, launched an exclusive VibeTonz category for downloadable ringtones. These companies along with leading content providers are using our VibeTonz technology and tools to create compelling content that we believe can generate a new source of revenue for their business." Immersion will host a conference call with company management on Thursday, November 2, 2006, at 5:00 p.m. Eastern time to discuss operating results for the third quarter ended September 30, 2006. A question and answer session will follow. To listen to the call, dial +1 800.374.2366 approximately five minutes prior to the start of the call and enter confirmation number 2398254. The call will be archived and available for replay until November 9, 2006, by dialing +1 800.642.1687 and entering confirmation number 2398254. The call will also be simulcast on the Internet through Immersion Corporation's Web site, http://www.immersion.com. An audio replay of the call will be archived and available at www.immersion.com for replay until November 2, 2007. About Immersion (www.immersion.com) Founded in 1993, Immersion Corporation is a recognized leader in developing, licensing, and marketing digital touch technology and products. Using Immersion's advanced touch feedback technology, electronic user interfaces can be made more productive, compelling, entertaining, or safer. Immersion technologies are deployed across automotive, entertainment, industrial controls, medical training, mobility, and three-dimensional simulation markets. Immersion's patent portfolio includes over 600 issued or pending patents in the U.S. and other countries. Forward-Looking Statements This press release contains "forward-looking statements" that involve risks and uncertainties, as well as assumptions that, if they never materialize or prove incorrect, could cause the results of Immersion Corporation and its consolidated subsidiaries to differ materially from those expressed or implied by such forward-looking statements. All statements, other than the statements of historical fact, are statements that may be deemed forward-looking statements, including any projections of earnings, revenues, or other financial matters; any statements of the plans, strategies, and objectives of management for future operations; any statements concerning consumer or market acceptance of simulator products for medical training, continuing education or evaluation; adoption and market acceptance of touch-enabled mobile phones or consumer and market acceptance of force feedback products in general; future development of force feedback products; proposed products or services; any statements regarding future economic conditions or performance; and statements of belief or assumptions underlying any of the foregoing. Immersion's actual results might differ materially from those stated or implied by such forward-looking statements due to risks and uncertainties associated with Immersion's business which include, but are not limited to, delay in or failure to achieve commercial demand for Immersion's expanded technology offerings; a delay in or failure to achieve the acceptance of force feedback as a critical user experience in new and existing markets for our business segments; and risks and uncertainties associated with ongoing litigation. For a more detailed discussion of these factors, and other factors that could cause Immersion's actual results to vary materially, interested parties should review the risk factors listed in Immersion's most current Form 10-Q, which is on file with the U.S. Securities and Exchange Commission. The forward-looking statements in this press release reflect Immersion's beliefs and predictions as of the date of this release. Immersion disclaims any obligation to update these forward-looking statements as a result of financial, business, or any other developments occurring after the date of this release. Immersion, the Immersion logo, and VibeTonz are trademarks of Immersion Corporation in the U.S. and other countries. All other trademarks are the property of their respective owners. Immersion Corporation Condensed Consolidated Balance Sheets (In thousands) September 30, December 31, 2006 2005 (Unaudited) (1) ------------- ------------ ASSETS Cash and cash equivalents $ 29,037 $ 28,171 Accounts receivable, net 5,458 4,650 Inventories, net 2,419 2,655 Prepaid expenses and other current assets 857 1,131 ------------- ------------ Total current assets 37,771 36,607 Property and equipment, net 1,724 1,366 Intangibles and other assets, net 7,243 6,787 ------------- ------------ TOTAL ASSETS $ 46,738 $ 44,760 ============= ============ LIABILITIES Accounts payable $ 1,234 $ 2,179 Accrued compensation 1,272 1,193 Other accrued liabilities 1,988 1,604 Deferred revenue and customer advances 2,179 2,741 Current portion of long-term debt - 5 ------------- ------------ Total current liabilities 6,673 7,722 Long-term debt 17,964 17,490 Long-term liabilities and deferred revenue 29,389 21,343 Long-term customer advance from Microsoft 15,000 15,000 ------------- ------------ Total liabilities 69,026 61,555 STOCKHOLDERS' DEFICIT (22,288) (16,795) ------------- ------------ TOTAL LIABILITIES & STOCKHOLDERS' DEFICIT $ 46,738 $ 44,760 ============= ============ (1) Derived from Immersion's annual audited consolidated financial statements. Immersion Corporation Condensed Consolidated Statements of Operations (In thousands, except per share amounts) (Unaudited) Three Months Nine Months Ended September Ended September 30, 30, 2006 2005 2006 2005 --------- -------- -------- --------- Revenues: Royalty and license $ 1,336 $ 1,473 $ 4,948 $ 6,273 Product sales 4,261 3,376 11,544 9,328 Development contracts and other 962 538 2,752 1,804 --------- -------- -------- --------- Total revenues 6,559 5,387 19,244 17,405 --------- -------- -------- --------- Costs and expenses: Cost of product sales (exclusive of amortization of intangibles shown separately below) 1,980 1,756 5,137 4,808 Sales and marketing 3,068 2,679 9,154 8,576 Research and development 1,894 1,446 5,425 4,483 General and administrative 2,463 3,073 7,570 7,557 Amortization of intangibles 227 314 656 1,050 Litigation settlement (300) - (1,350) - Restructuring - - - 185 ------------------ -------- --------- Total costs and expenses 9,332 9,268 26,592 26,659 --------- -------- -------- --------- Operating loss (2,773) (3,881) (7,348) (9,254) Interest and other income (expense), net (340) (265) (963) (756) --------- -------- -------- --------- Loss before provision for income taxes (3,113) (4,146) (8,311) (10,010) Provision for income taxes (44) (12) (131) (110) --------- -------- -------- --------- Net loss $ (3,157) $(4,158) $(8,442) $(10,120) ========= ======== ======== ========= Basic and diluted net loss per share $ (0.13) $ (0.17) $ (0.34) $ (0.42) --------- -------- -------- --------- Shares used in calculating basic and diluted net loss per share 24,590 24,132 24,519 23,950 --------- -------- -------- --------- Immersion Corporation Additional Financial Information Effect of Non Cash Stock-Based Compensation included within Condensed Consolidated Statement of Operations (In thousands) (Unaudited) Three Months Three ended Three Months Non Cash September Months ended Stock-Based 30, 2006, ended September Compensation exclusive of September 30, 2006, included Non Cash 30, 2005, as within Stock-Based as reported expense Compensation reported ----------- -------------- ------------- ----------- Costs and expenses Cost of product sales $ 1,980 $ 17 $ 1,963 $ 1,756 Sales and marketing 3,068 305 2,763 2,679 Research and development 1,894 122 1,772 1,446 General and administration 2,463 280 2,183 3,073 Other, net (73) - (73) 314 ----------- -------------- ------------- ----------- Total costs and expenses $ 9,332 $ 724 $ 8,608 $ 9,268 =========== ============== ============= =========== Nine Months ended Nine Months Non Cash September Nine Months ended Stock-Based 30, 2006, ended September Compensation exclusive of September 30, 2006, included Non Cash 30, 2005, as within Stock-Based as reported expense Compensation reported ----------- -------------- ------------- ----------- Costs and expenses Cost of product sales $ 5,137 $ 54 $ 5,083 $ 4,808 Sales and marketing 9,154 887 8,267 8,576 Research and development 5,425 372 5,053 4,483 General and administration 7,570 828 6,742 7,557 Other, net (694) - (694) 1,235 ----------- -------------- ------------- ----------- Total costs and expenses $ 26,592 $ 2,141 $ 24,451 $ 26,659 =========== ============== ============= =========== We adopted Statement of Financial Accounting Standards No. 123R "Share-Based Payment" effective January 1, 2006 and are required to recognize expense on our share-based payments from January 1, 2006. Our Consolidated Statement of Operations prior to January 1, 2006 does not include expense associated with share-based payments. We have included the above information to assist in comparing our operating expenses to prior periods. CONTACT: Immersion Corporation Stephen Ambler, +1 408-467-1900 invest@immersion.com -----END PRIVACY-ENHANCED MESSAGE-----