EX-99.1 2 cavm-ex991_6.htm EX-99.1 cavm-ex991_6.htm

Exhibit 99.1

 

Cavium

Announces Financial Results for Q2 2016

SAN JOSE, Calif., July 26, 2016 – Cavium, Inc. (NASDAQ: CAVM), a leading provider of semiconductor products that enable secure and intelligent processing for enterprise, data center, cloud, wired and wireless networking, today announced financial results for the second quarter ended June 30, 2016.

Net revenue in the second quarter was $107.2 million, a 5.2% sequential increase from the $101.9 million reported in the first quarter of 2016 and 2.1% from the $105.0 million reported in the second quarter of 2015.

Generally Accepted Accounting Principles (GAAP) Results

Net loss for the second quarter of 2016 was $7.4 million, or $(0.13) per diluted share, compared to $3.8 million, or $(0.07) per diluted share in the first quarter of 2016. Gross margins were 66.9% in the second quarter of 2016 compared to 66.8% in the first quarter of 2016. GAAP operating loss (GAAP loss from operations as a percentage of revenue) was 6.3% in the second quarter of 2016 compared to 3.3% in the first quarter of 2016. Total cash and cash equivalents were $140.4 million at June 30, 2016.

Non-GAAP Results

Cavium believes that the presentation of non-GAAP financial measures provides important supplemental information to management and investors regarding financial and business trends relating to Cavium’s financial condition and results of operations. These measures should only be used to evaluate Cavium’s results of operations in conjunction with the corresponding GAAP measures. The reconciliation between GAAP and non-GAAP financial results is provided in the financial statements portion of this release.

In the second quarter of 2016, Non-GAAP net income was $17.2 million, or $0.29 per diluted share. Non-GAAP gross margin was 67.3% and Non-GAAP operating margin (non-GAAP income from operations as a percentage of revenue) was 16.6%.

Recent News Highlights

 

·

July 13, 2016 - Cavium Commences Exchange Offer to Acquire QLogic

 

·

June 21, 2016 - Cavium Adds Microsemi’s Storage Solutions to ThunderX® Processor Family

 

·

June 20, 2016 - IDT Collaborates with Cavium to Support Hyperscale Data Centers

 

·

June 20, 2016 - Cavium and Partners Demonstrated ThunderX Servers at ISC 2016

 

·

June 15, 2016 - Cavium Announced to Acquire QLogic

 

·

May 20, 2016 - Cavium Announced ThunderX2™

 

·

May 30, 2016 - Cavium Showcased The CloudScale Rack™

 

·

May 23, 2016 - Cavium Unveiled OCTEON TX™: Industry’s widest range of 64-bit ARM®-based SOCs for a broad spectrum of open, services-centric applications in enterprise and service provider infrastructure

 

Cavium, Inc. will broadcast its second quarter of 2016 financial results conference call today, July 26, 2016, at 2 p.m. Pacific time (5 p.m. Eastern time).  The conference call will be available via a live web cast on the investor relations section of the Cavium website at http://www.cavium.com. Please access the website at least a few minutes prior to the start of the call in order to download and install any necessary audio software. An archived web cast replay of the call will be available on the web site for a limited period of time.

About Cavium

Cavium is a leading provider of highly integrated semiconductor products that enable intelligent processing in enterprise, data center, cloud and wired and wireless service provider applications. Cavium offers a broad portfolio of integrated, software-compatible processors ranging in performance from 100 Mbps to 100 Gbps that enable secure, intelligent functionality in enterprise, data-center, broadband/consumer and access and service provider equipment. Cavium’s processors are supported by ecosystem partners that provide operating systems, tool support, reference designs and other services. Cavium’s principal office is in San Jose, CA with design team locations in California, Massachusetts, India and China. For more information, please visit: http://www.cavium.com.

 


 

 

CAVIUM, INC.

Unaudited GAAP Condensed Consolidated Statements of Operations

(in thousands, except per share amounts)

Three Months Ended

 

 

June 30, 2016

 

 

March 31, 2016

 

Net revenue

$

107,158

 

 

$

101,882

 

Cost of revenue

 

35,499

 

 

 

33,866

 

Gross profit

 

71,659

 

 

 

68,016

 

Operating expenses:

 

 

 

 

 

 

 

     Research and development

 

52,578

 

 

 

50,455

 

     Sales, general and administrative

 

25,882

 

 

 

20,925

 

        Total operating expenses

 

78,460

 

 

 

71,380

 

Loss from operations

 

(6,801

)

 

 

(3,364

)

Other income (expense), net:

 

 

 

 

 

 

 

    Interest expense

 

(185

)

 

 

(208

)

    Other, net

 

(151

)

 

 

14

 

Total other expense, net

 

(336

)

 

 

(194

)

     Loss before income taxes

 

(7,137

)

 

 

(3,558

)

     Provision for income taxes

 

273

 

 

 

275

 

Net loss

$

(7,410

)

 

$

(3,833

)

Net loss per common share, basic and diluted

$

(0.13

)

 

$

(0.07

)

Shares used in computing basic and diluted net loss per common share

 

57,527

 

 

 

56,932

 


CAVIUM, INC.

Unaudited Reconciliation of Non-GAAP Adjustments

(in thousands)

 

Three Months Ended

 

 

June 30, 2016

 

 

March 31, 2016

 

Reconciliation of GAAP operating expenses to non-GAAP:

 

 

 

 

 

 

 

GAAP research and development expenses

$

52,578

 

 

$

50,455

 

Stock-based compensation and related payroll taxes

 

(9,017

)

 

 

(8,773

)

Amortization of acquisition related assets and other

 

(3,523

)

 

 

(3,532

)

Non-GAAP research and development expenses

$

40,038

 

 

$

38,150

 

 

 

 

 

 

 

 

 

GAAP sales, general and administrative expenses

$

25,882

 

 

$

20,925

 

Stock-based compensation and related payroll taxes

 

(5,263

)

 

 

(5,984

)

Acquisition related expenses

 

(6,339

)

 

 

-

 

Non-GAAP sales, general and administrative expenses

$

14,280

 

 

$

14,941

 

Total Non-GAAP operating expenses

$

54,318

 

 

$

53,091

 

 

 

 

 

 

 

 

 

 


CAVIUM, INC.

Unaudited Reconciliation of Non-GAAP Adjustments

(in thousands, except per share data and percentages)

 

Three Months Ended

 

 

June 30, 2016

 

 

March 31, 2016

 

Reconciliation of GAAP gross profit and margin to non-GAAP:

 

 

 

 

 

 

 

Net revenue

$

107,158

 

 

$

101,882

 

GAAP gross profit

 

71,659

 

 

 

68,016

 

GAAP gross margin

 

66.9

%

 

 

66.8

%

 

 

 

 

 

 

 

 

Stock-based compensation and related payroll taxes

 

261

 

 

 

191

 

Amortization of acquisition related assets

 

157

 

 

 

157

 

Non-GAAP gross profit

$

72,077

 

 

$

68,364

 

Non-GAAP gross margin

 

67.3

%

 

 

67.1

%

 

 

 

 

 

 

 

 

Reconciliation of GAAP loss from operations to non-GAAP income from operations:

 

 

 

 

 

 

 

GAAP loss from operations

$

(6,801

)

 

$

(3,364

)

Stock-based compensation and related payroll taxes

 

14,541

 

 

 

14,948

 

Amortization of acquisition related assets and other

 

3,680

 

 

 

3,689

 

Acquisition related expenses

 

6,339

 

 

 

-

 

Non-GAAP income from operations

$

17,759

 

 

$

15,273

 

Non-GAAP income from operations as a percentage of revenue

 

16.6

%

 

 

15.0

%

 

 

 

 

 

 

 

 

Reconciliation of GAAP net loss to non-GAAP net income:

 

 

 

 

 

 

 

GAAP net loss

$

(7,410

)

 

$

(3,833

)

Non-GAAP adjustments:

 

 

 

 

 

 

 

Stock-based compensation and related payroll taxes

 

14,541

 

 

 

14,948

 

Amortization of acquisition related assets and other

 

3,680

 

 

 

3,689

 

Acquisition related expenses

 

6,339

 

 

 

-

 

Total of non-GAAP adjustments

 

24,560

 

 

 

18,637

 

Non-GAAP net income

$

17,150

 

 

$

14,804

 

 

 

 

 

 

 

 

 

GAAP net loss per share, diluted

$

(0.13

)

 

$

(0.07

)

Non-GAAP adjustments detailed above

 

0.42

 

 

 

0.32

 

Non-GAAP net income per share, diluted

$

0.29

 

 

$

0.25

 

 

 

 

 

 

 

 

 

GAAP weighted average shares, diluted

 

57,527

 

 

 

56,932

 

Non-GAAP share adjustment

 

2,471

 

 

 

3,233

 

Non-GAAP weighted average shares, diluted

 

59,998

 

 

 

60,165

 

 


CAVIUM, INC.

Unaudited GAAP Condensed Consolidated Balance Sheets

(in thousands)

As of

 

 

June 30, 2016

 

 

March 31, 2016

 

Assets

 

 

 

 

 

 

 

Current assets

 

 

 

 

 

 

 

Cash and cash equivalents

$

140,419

 

 

$

129,629

 

Accounts receivable, net

 

82,137

 

 

 

79,594

 

Inventories

 

52,702

 

 

 

48,092

 

Prepaid expenses and other current assets

 

10,109

 

 

 

8,233

 

Total current assets

 

285,367

 

 

 

265,548

 

Property and equipment, net

 

64,917

 

 

 

63,303

 

Intangible assets, net

 

36,698

 

 

 

37,907

 

Goodwill

 

71,478

 

 

 

71,478

 

Other assets

 

1,822

 

 

 

1,738

 

Total assets

$

460,282

 

 

$

439,974

 

 

 

 

 

 

 

 

 

Liabilities and Stockholders' Equity

 

 

 

 

 

 

 

Current liabilities

 

 

 

 

 

 

 

Accounts payable

$

30,024

 

 

$

25,668

 

Other accrued expenses and other current liabilities

 

16,447

 

 

 

8,326

 

Deferred revenue

 

7,856

 

 

 

6,425

 

Capital lease and technology license obligations

 

17,380

 

 

 

17,286

 

Total current liabilities

 

71,707

 

 

 

57,705

 

Capital lease and technology license obligations, net of current

 

4,182

 

 

 

6,932

 

Deferred tax liability

 

3,923

 

 

 

3,785

 

Other non-current liabilities

 

4,140

 

 

 

2,907

 

Total liabilities

 

83,952

 

 

 

71,329

 

 

 

 

 

 

 

 

 

Stockholders' equity

 

 

 

 

 

 

 

Common stock

 

58

 

 

 

57

 

Additional paid-in capital

 

576,927

 

 

 

561,833

 

Accumulated deficit

 

(200,655

)

 

 

(193,245

)

Total stockholders' equity

 

376,330

 

 

 

368,645

 

Total liabilities and stockholders' equity

$

460,282

 

 

$

439,974

 

 

 

 

Cavium Contact:

 

Art Chadwick

 

Angel Atondo

Vice President of Finance and Administration and Chief Financial Officer              

 

Senior Marketing Communications Manager

Tel: (408) 943-7104

 

Tel: (408) 943-7417    

Email: art.chadwick@cavium.com

 

Email: angel.atondo@cavium.com