EX-99.1 2 f37821exv99w1.htm EXHIBIT 99.1 exv99w1
 

Exhibit 99.1
News Release
     
Investor Relations Contact:
  Investor Relations Contact:
Steven Melman, VP, Investor Relations
  Sonia Segovia, IR Coordinator
PDF Solutions, Inc.
  PDF Solutions, Inc.
Tel: (408) 938-6445
  Tel: (408) 938-6491
Email: steve.melman@pdf.com
  Email: sonia.segovia@pdf.com
PDF Solutions ® Reports Fourth Quarter
2007 Results
Fourth Quarter Results Contribute to Record Revenue for Fiscal 2007
     SAN JOSE, Calif.—February 7, 2008—PDF Solutions, Inc. (NASDAQ: PDFS) the leading provider of yield improvement technologies and services for the integrated circuit (IC) manufacturing process lifecycle, today announced financial results for its fourth fiscal quarter ended December 31, 2007.
     Total revenue for the fourth fiscal quarter of 2007 totaled $24.6 million, an increase of 30%, compared with total revenue of $19.0 million for the fourth fiscal quarter of 2006. Gain share revenue for the fourth fiscal quarter of 2007 totaled $6.5 million, an increase of 33%, compared to $4.9 million for the fourth fiscal quarter of 2006. Total revenue for the full fiscal year ended December 31, 2007 totaled a record $94.5 million, compared with total revenue of $76.2 million for the full fiscal year ended December 31, 2006, an increase of 24%. Gain share revenue for the full fiscal year ended December 31, 2007 totaled a record $24.1 million compared with gain share revenue of $20.0 million for the full fiscal year ended December 31, 2006, an increase of 20%. Net income for the fourth fiscal quarter of 2007 totaled $1.1 million, or $0.04 per diluted share, compared with a net loss of $430,000, or $0.02 per basic and diluted share, for the fourth fiscal quarter of 2006.
     In addition to using GAAP results in evaluating PDF Solutions’ business, management also believes it is useful to measure results using a non-GAAP measure of net income, which excludes stock-based compensation expense, amortization of acquired intangible assets, write-off of in-process research and development, and their related income tax effects, as applicable. Using this non-

 

 

GAAP measure, net income for the fourth fiscal quarter of 2007 totaled $5.8 million, or $0.21 per diluted share, compared with non-GAAP net income of $2.3 million, or $0.08 per diluted share, for the fourth fiscal quarter of 2006.
     Additionally, during the fourth quarter ended December 31, 2007, PDF Solutions utilized a portion of the $10 million share repurchase plan previously authorized by its Board of Directors to repurchase 201,300 of its shares on the open market at a weighted average cost of $7.57, for a total repurchase value of $1.5 million.
     As previously announced, PDF will discuss these results on a live conference call beginning at 3:00 p.m. Pacific Time/6:00 p.m. Eastern Time today. The call will be simultaneously web cast on PDF Solutions’ website at http://ir.pdf.com/medialist.cfm. A replay of the web cast will be available at the same website address beginning approximately two hours after completion of the live call. Further, a copy of this press release, including the disclosure and reconciliation of certain non-GAAP financial measures to the comparable GAAP measure, which non-GAAP measures may be used periodically by PDF Solutions’ management when discussing financial results with investors and analysts, will be available on PDF Solutions’ website at http://www.pdf.com/news_archive.phtml following the date of this release.
Information Regarding Use of Non-GAAP Financial Measures
In addition to providing results that are determined in accordance with Generally Accepted Accounting Principles in the United States of America (GAAP), PDF Solutions also provides certain non-GAAP financial measures that exclude the effects of stock-based compensation expense, amortization of acquired intangible assets, write-off of in-process research and development, and their related income tax effects, as applicable. PDF Solutions’ management believes that the presentation of these measures provides useful supplemental information to investors regarding PDF’s operating results. These non-GAAP financial measures are used by management internally to measure the company’s profitability and performance. PDF’s management believes that excluding the effects of stock-based compensation expense, amortization of acquired intangible assets, write-off of in-process research and development, and their related income tax effects, as applicable, provides a useful supplemental measure of the company’s ongoing operations in light of the fact that neither category of expense has a current effect on the future uses of cash nor do they have use with regards to the generation of current or future revenues. These non-GAAP results should not be considered an alternative to, or a substitute for, GAAP financial information, and may be different from similarly titled non-GAAP measures used by other companies. In particular, these non-GAAP financial measures are not a substitute for GAAP measures of income as a measure of performance, or to cash flows from operating, investing and financing activities as a measure of liquidity. Since management uses these non-GAAP financial

 

 

measures internally to measure profitability and performance, PDF has included these non-GAAP measures to give investors an opportunity to see the company’s financial results as viewed by management. A reconciliation of the non-GAAP financial measures to the comparable GAAP financial measure is provided at the end of the company’s financial statements presented below.
About PDF Solutions
PDF Solutions, Inc. (NASDAQ: PDFS) is the leading provider of yield improvement technologies and services for the IC manufacturing process lifecycle. PDF Solutions offers solutions that are designed to enable clients to lower costs of IC design and manufacture, enhance time to market, and improve profitability by addressing design and manufacturing interactions from product design to initial process ramps to mature manufacturing operations. PDF Solutions’ Characterization Vehicle® (CV®) test chips provide the core modeling capabilities, and are used by more leading manufacturers than any other test chips in the industry. PDF Solutions’ industry leading yield management system software, dataPOWER®, and fault detection and classification software, maestria®, enhance yield improvement and production control activities at leading fabs around the world. Headquartered in San Jose, Calif., PDF Solutions operates worldwide with additional offices in China, Europe, Japan and Korea. For the company’s latest news and information, visit http://www.pdf.com/.
Characterization Vehicle, CV, dataPOWER, Maestria, PDF Solutions, and the PDF Solutions logo are registered trademarks of PDF Solutions, Inc.

 

 

PDF SOLUTIONS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)
(In thousands)
                 
    December 31,     December 31,  
    2007     2006  
ASSETS
                
Current assets:
                
Cash and cash equivalents
   $ 35,315     $ 36,451  
Short-term investments
     9,949       16,402  
Accounts receivable
     38,526       27,575  
Prepaid expenses and other current assets
     3,354       2,796  
Deferred tax assets
     1,676       2,581  
 
            
Total current assets
     88,820       85,805  
Property and equipment, net
     3,621       3,916  
Goodwill
     65,170       60,034  
Intangible assets, net
     12,818       13,605  
Long-term deferred tax assets
     8,458       4,994  
Other assets
     464       503  
 
            
Total assets
   $ 179,351     $ 168,857  
 
            
 
                
LIABILITIES AND STOCKHOLDERS’ EQUITY
                
Current liabilities:
                
Current portion of long-term debt
   $ 421     $ 302  
Accounts payable
     3,469       3,182  
Accrued compensation and related benefits
     5,950       3,325  
Other accrued liabilities
     2,604       3,843  
Taxes payable
     208       4,767  
Deferred revenue
     3,159       3,705  
Billings in excess of recognized revenue
     553       95  
 
            
Total current liabilities
     16,364       19,219  
Long-term debt
     907       1,198  
Long-term taxes payable
     5,581       —  
Long-term other liabilities
     29       221  
 
            
Total liabilities
     22,881       20,638  
 
            
Stockholders’ equity:
                
Common stock
     4       4  
Additional paid-in-capital
     181,566       167,323  
Treasury stock at cost
     (11,524 )     (5,549 )
Accumulated deficit
     (16,892 )     (13,890 )
Accumulated other comprehensive income
     3,316       331  
 
            
Total stockholders’ equity
     156,470       148,219  
 
            
Total liabilities and stockholders’ equity
   $ 179,351     $ 168,857  
 
            

 

 

PDF SOLUTIONS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
(In thousands, except per share amounts)
                                 
    Three Months Ended     Year Ended  
    December 31,     December 31,     December 31,     December 31,  
    2007     2006     2007     2006  
Revenue:
                                
Design-to-silicon-yield solutions
                                
Services
   $ 17,641     $ 11,523     $ 63,731     $ 45,382  
Software licenses
     417       2,557       6,645       10,774  
Gain share
     6,497       4,873       24,087       20,028  
 
                        
Total revenue
     24,555       18,953       94,463       76,184  
 
                        
 
                                
Cost of design-to-silicon-yield solutions:
                                
Direct costs of design-to-silicon-yield solutions
                                
Services
     9,437       7,610       32,279       27,418  
Software licenses
     57       111       191       209  
Amortization of acquired core technology
     632       1,472       5,148       5,270  
 
                        
Total cost of design-to silicon-yield solutions
     10,126       9,193       37,618       32,897  
 
                        
Gross margin
     14,429       9,760       56,845       43,287  
 
                                
Operating expenses:
                                
Research and development
     9,899       8,070       36,074       27,613  
Selling, general and administrative
     6,613       4,964       24,891       19,814  
Amortization of other acquired intangible assets
     393       754       3,422       1,459  
Write-off of in-process research and development
     —       800       —       800  
 
                        
Total operating expenses
     16,905       14,588       64,387       49,686  
 
                        
 
                                
Loss from operations
     (2,476 )     (4,828 )     (7,542 )     (6,399 )
Interest and other income, net
     544       489       1,891       2,827  
 
                        
Loss before taxes
     (1,932 )     (4,339 )     (5,651 )     (3,572 )
 
                                
Income tax benefit
     (3,000 )     (3,909 )     (2,724 )     (3,133 )
 
                        
Net income (loss)
   $ 1,068     $ (430 )   $ (2,927 )   $ (439 )
 
                        
 
                                
Net income (loss) per share:
                                
Basic
   $ 0.04     $ (0.02 )   $ (0.10 )   $ (0.02 )
 
                        
Diluted
   $ 0.04     $ (0.02 )   $ (0.10 )   $ (0.02 )
 
                        
 
                                
Weighted average common shares:
                                
Basic
     27,964       27,459       28,066       26,885  
 
                        
Diluted
     28,246       27,459       28,066       26,885  
 
                        

 

 

PDF SOLUTIONS, INC.
NON-GAAP RESULTS
(In thousands, except per share amounts)
                 
    Three Months Ended  
    December 31,     December 31,  
    2007     2006  
GAAP net income (loss)
   $ 1,068     $ (430 )
Stock-based compensation expense – cost of design-to-silicon-yield solutions
     765       596  
Stock-based compensation expense – research and development
     888       599  
Stock-based compensation expense – selling, general and administrative
     1,124       695  
Amortization of acquired core technology
     632       1,472  
Amortization of other acquired intangible assets
     393       754  
Write-off of in-process research and development
     —       800  
Tax impact on reversal of stock-based compensation expense and amortization of intangible assets
     976       (2,165 )
 
            
Non-GAAP net income
   $ 5,846     $ 2,321  
 
            
 
                
GAAP net income (loss) per diluted share
   $ 0.04     $ (0.02 )
Non-GAAP net income per diluted share
   $ 0.21     $ 0.08  
Shares used in computing diluted non-GAAP measure of net income per share
     28,246       28,484  
###