EX-99.1 3 dex991.htm SELECTED FINANCIAL DATA Selected Financial Data

Exhibit 99.1

ITEM 6. SELECTED FINANCIAL DATA.

The following selected financial data as of and for the fiscal years ended January 31, 2006, 2005, 2004, 2003, and 2002, respectively, have been derived from our consolidated financial statements audited by KPMG LLP, independent registered public accounting firm. These historical results are not necessarily indicative of the results of operations to be expected for any future period.

The data set forth below (in thousands, except per share data) should be read in conjunction with Item 7. “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and the consolidated financial statements included in Item 8. “Financial Statements and Supplementary Data.”

The following tables reflect the impact of the accounting policy change on the January 31, 2006 fiscal year end consolidated financial statement. (See Note 2A in the Notes to the Consolidated Financial Statements.)

 

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     Fiscal Year Ended January 31,  
     2006     2005     2004     2003     2002  
     (As Adjusted - Note 2A)                          
     (in thousands, except per share data)  

Consolidated Statement of Operations Data:

          

Revenues

          

Service revenues

   $ 167,194     $ 107,166     $ 61,560     $ 39,261     $ 19,297  

Technology revenues

     3,665       8,310       15,797       20,909       100  

Hardware revenues

     72,093       111,275       72,882       45,620       —    

Rebates, revenue share, and other payment to the channel

     (47,027 )     (54,696 )     (9,159 )     (9,780 )     —    
                                        

Net Revenues

     195,925       172,055       141,080       96,010       19,397  
                                        

Cost and Expenses

          

Cost of service revenues

     34,179       29,360       17,705       17,119       19,852  

Cost of technology revenues

     782       6,575       13,609       8,033       62  

Cost of hardware revenues

     86,817       120,323       74,836       44,647       —    

Research and development

     41,087       37,634       22,167       20,714       27,205  

Sales and marketing

     35,047       37,367       18,947       48,117       104,897  

General and administrative

     38,018       16,593       16,296       14,465       18,875  
                                        

Loss from operations

     (40,005 )     (75,797 )     (22,480 )     (57,085 )     (151,494 )
                                        

Interest income

     3,084       1,548       498       4,483       2,163  

Interest expense and other

     (14 )     (5,459 )     (9,587 )     (27,569 )     (7,374 )
                                        

Loss before income taxes

     (36,935 )     (79,708 )     (31,569 )     (80,171 )     (156,705 )

Provision for income taxes

     (64 )     (134 )     (449 )     (425 )     (1,000 )
                                        

Net Loss

     (36,999 )     (79,842 )     (32,018 )     (80,596 )     (157,705 )

Less: Series A redeemable convertible preferred stock dividend

     —         —         —         (220 )     (3,018 )

Less: Accretion to redemption value of Series A redeemable convertible preferred stock

     —         —         —         (1,445 )     —    
                                        

Net loss attributable to common shareholder

   $ (36,999 )   $ (79,842 )   $ (32,018 )   $ (82,261 )   $ (160,723 )
                                        

Net loss per share

          

Basic and diluted

   $ (0.44 )   $ (0.99 )   $ (0.48 )   $ (1.61 )   $ (3.74 )

Weighted average shares used to calculate basic and diluted net loss per share

     83,683       80,264       66,784       51,219       42,956  
     As of January 31,  
     2006     2005     2004     2003     2002  
     (As Adjusted - Note 2A)                          
     (in thousands)  

Consolidated Balance Sheet Data:

          

Cash and cash equivalents

   $ 85,298     $ 87,245     $ 138,210     $ 40,401     $ 46,527  

Short-term investments

     18,915       19,100       5,025       3,800       5,800  

Total assets

     159,008       160,052       183,891       82,320       149,934  

Current redeemable convertible preferred stock

     —         —         —         —         2  

Long-term portion of convertible notes payable

     —         —         6,005       4,265       18,315  

Long-term portion of convertible notes payable-related parties

     —         —         —         3,920       9,426  

Long-term portion of deferred revenues

     67,575       63,131       46,035       32,373       23,552  

Long-term portion of obligations under capital lease

     —         —         —         —         2  

Total paid-in capital for current redeemable convertible preferred stock and redeemable common stock

     —         —         —         —         46,553  

Total stockholders’ equity (deficit)

     (29,372 )     (2,692 )     65,632       (24,697 )     (29,944 )

Quarterly Results of Operations

The following table represents certain unaudited statement of operations data for our eight most recent quarters ended January 31, 2006. In management’s opinion, this unaudited information has been prepared on the same basis as the audited annual financial statements and includes all adjustments, consisting only of normal recurring adjustments, necessary for a fair representation of the unaudited information for the quarters presented. This information should be read in conjunction with our audited consolidated financial statements, including the notes thereto, included elsewhere in this Current Report. The results of operations for any quarter are not necessarily indicative of results that may be expected for any future period. Certain amounts in prior periods have been reclassified to conform to the current year presentation.

 

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The following table reflects the impact of the accounting policy change on the January 31, 2006 fiscal year end consolidated financial statement. (See Note 2A in the Notes to the Consolidated Financial Statements.)

 

     Three Months Ended  
     Jan 31,
2006
    Oct 31,
2005
    Jul 31,
2005
    Apr 30,
2005
    Jan 31,
2005
    Oct 31,
2004
    Jul 31,
2004
    Apr 30,
2004
 
     (As Adjusted - Note 2A)                                
     (unaudited, in thousands except per share data)  

Revenues

                

Service revenues

   $ 46,305     $ 42,296     $ 40,249     $ 38,344     $ 32,996     $ 27,678     $ 24,333     $ 22,159  

Technology revenues

     663       901       425       1,676       1,169       699       3,427       3,015  

Hardware revenues

     32,266       24,652       4,649       10,526       50,452       27,894       18,592       14,337  

Rebates, revenue share, and other payments to channel

     (19,167 )     (18,234 )     (5,988 )     (3,638 )     (25,188 )     (17,944 )     (6,576 )     (4,988 )
                                                                

Net revenues

     60,067       49,615       39,335       46,908       59,429       38,327       39,776       34,523  

Cost of revenues

                

Cost of service revenues

     10,250       8,431       6,859       8,639       10,426       6,505       6,836       5,593  

Cost of technology revenues

     (121 )     77       599       227       440       1,465       2,708       1,962  

Cost of hardware revenues

     38,811       24,667       7,697       15,642       52,267       28,486       22,720       16,850  
                                                                

Total cost of revenues

     48,940       33,175       15,155       24,508       63,133       36,456       32,264       24,405  
                                                                

Gross margin

     11,127       16,440       24,180       22,400       (3,704 )     1,871       7,512       10,118  

Operating Expenses

                

Research and development

     10,693       9,712       9,778       10,904       11,206       9,291       8,138       8,999  

Sales and marketing

     10,637       10,006       7,574       6,830       11,529       14,212       6,026       5,600  

General and administrative

     11,769       11,702       8,409       6,138       4,194       4,366       3,794       4,239  
                                                                

Loss from operations

     (21,972 )     (14,980 )     (1,581 )     (1,472 )     (30,633 )     (25,998 )     (10,446 )     (8,720 )

Interest income

     900       826       734       624       458       397       366       327  

Interest expense and other

     (1 )     (10 )     (2 )     (1 )     (3,464 )     (671 )     (668 )     (656 )
                                                                

Income (loss) before income taxes

     (21,073 )     (14,164 )     (849 )     (849 )     (33,639 )     (26,272 )     (10,748 )     (9,049 )

Provision for income taxes

     (13 )     —         (43 )     (8 )     (26 )     (78 )     (12 )     (18 )
                                                                

Net income (loss)

   $ (21,086 )   $ (14,164 )   $ (892 )   $ (857 )   $ (33,665 )   $ (26,350 )   $ (10,760 )   $ (9,067 )
                                                                

Net Income (loss) per common share basic and diluted

   $ (0.25 )   $ (0.17 )   $ (0.01 )   $ (0.01 )   $ (0.42 )   $ (0.33 )   $ (0.13 )   $ (0.11 )
                                                                

Weighted average common shares used to calculate basic net income (loss) per share

     84,643       84,201       83,506       82,381       80,793       80,267       80,197       79,800  
                                                                

Weighted average common shares used to calculate diluted net income (loss) per share

     84,643       84,201       86,479       82,381       80,793       80,267       80,197       79,800  
                                                                

 

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