EX-99.1 2 at3848ex991.txt EXHIBIT 99.1 Exhibit 99.1 ATMEL REPORTS IMPROVED RESULTS FOR THE THIRD QUARTER OF 2005 GROSS MARGIN IMPROVES BY OVER 5 PERCENTAGE POINTS SAN JOSE, Calif., Oct. 25 /PRNewswire-FirstCall/ -- Atmel Corporation (Nasdaq: ATML), a worldwide leader in the development, fabrication and sale of advanced semiconductors, today announced financial results for the third quarter ended September 30, 2005. Revenues for the third quarter of 2005 totaled $418.6 million, versus $412.2 million in the second quarter of 2005 and $413.2 million in the third quarter of 2004. Net loss for the third quarter of 2005 totaled $1.1 million or $0.00 per share. The third quarter results include a restructuring charge of $2.8 million related to headcount reductions. Also included in the third quarter results is $12.0 million of tax benefit resulting from the settlement of a tax audit related to one of our foreign entities. These results compare to a net loss of $42.6 million or $0.09 per share for the second quarter of 2005, as well as a net loss of $18.0 million or $0.04 per share for the third quarter of 2004. "In the third quarter, we significantly lowered our manufacturing costs, leading to over 5 percentage points of gross margin improvement," stated George Perlegos, Atmel's President and Chief Executive Officer. "We expect to continue steadily reducing manufacturing and research and development spending, which should lead to further improvements in our operating profits. "Our ASIC revenues grew about 7% sequentially in the third quarter. During the quarter, we increased the percentage of our smart card ICs produced on 0.18-micron line width to over 80%, which contributed to the improved operating results of the ASIC business. "During the third quarter of 2005, our Microcontroller operating segment sales were down 4% sequentially, due mainly to the seasonal impact of our European military and aerospace business. However, we again saw growth in our proprietary AVR microcontroller products, which also enjoyed strong design win activity. Additionally, we shipped our first AVR units into the US automotive sector during the quarter. "Sales in our RF and Automotive operating segment in the third quarter were down 5% sequentially. Although our RF BiCMOS business was down during the quarter, we expect to ramp up new designs for CDMA phones during the fourth quarter. "During the third quarter, our Non Volatile Memory business increased by 4% sequentially, mainly due to increased sales of our serial based products. Both our serial EEPROM and serial DataFlash(R) business enjoyed stronger demand late in the third quarter," concluded Mr. Perlegos. Outlook The Company anticipates that for the fourth quarter of 2005, revenues should increase about 1-3%, while gross margin should increase approximately 1 percentage point as compared to the third quarter of 2005. Additionally, R&D is expected to be approximately $67-$70 million, while SG&A is expected to be between $46-$50 million. Net interest expense for the quarter is expected to be approximately $6-$7 million, while income taxes are expected to be approximately $1-$3 million. We anticipate that depreciation and amortization will be approximately $67-$70 million. Teleconference Atmel will hold a teleconference for the financial community at 3:00 PM Pacific Time today to discuss the third quarter financial results. Atmel will provide a real-time audio broadcast of the teleconference from the Investor Relations page of its website at http://www.atmel.com. Investors may access the live teleconference by dialing 800-374-0405, and using the passcode 1436228. A webcast replay will be available for one year after the teleconference at http://www.atmel.com. Atmel will also provide a telephone recording of the teleconference, which will be available shortly after the completion of the call. Interested parties may listen to the playback of the teleconference by calling the following number: 800-642-1687, and using the passcode 1436228, within 48 hours of completion of the call. Information in this release regarding Atmel's forecasts, outlook, expectations and beliefs are forward-looking statements that involve risks and uncertainties. These statements include statements about Atmel's expected fourth quarter operating results, including revenues, gross margins, operating expenses, demand levels, new product shipments and market conditions. All forward-looking statements included in this release are based upon information available to Atmel as of the date of this release, which may change, and we assume no obligation to update any such forward-looking statement. These statements are not guarantees of future performance and actual results could differ materially from our current expectations. Factors that could cause or contribute to such differences include the impact of competitive products and pricing, timely design acceptance by our customers, timely introduction of new technologies, ability to ramp new products into volume, industry wide shifts in supply and demand for semiconductor products, industry and/or company overcapacity, effective and cost efficient utilization of manufacturing capacity, financial stability in foreign markets, and other risks detailed from time to time in Atmel's SEC reports and filings, including our Form 10-K, filed on March 25, 2005 and subsequent Form 10-Q reports. Contact: Steven Horwitz, Director, Investor Relations: 408-487-2677 Atmel Corporation Condensed Consolidated Statements of Operations (In thousands, except per share data) (Unaudited)
Three Months Ended Nine Months Ended September 30 September 30 ---------------------------- ---------------------------- 2005 2004 2005 2004 ------------ ------------ ------------ ------------ Net revenues $ 418,550 $ 413,237 $ 1,250,527 $ 1,241,435 Operating expenses Cost of revenues 301,759 298,103 953,954 885,952 Research and development 69,655 65,732 209,938 179,683 Selling, general and administrative 45,089 44,501 150,717 131,669 Restructuring charge 2,785 -- 2,785 -- Total operating expenses 419,288 408,336 1,317,394 1,197,304 Income (loss) from operations (738) 4,901 (66,867) 44,131 Interest and other expenses, net (7,012) (5,043) (19,984) (13,651) Income (loss) before income taxes (7,750) (142) (86,851) 30,480 Benefit from (provision for) income taxes 6,653 (17,867) 153 (25,829) Net income (loss) $ (1,097) $ (18,009) $ (86,698) $ 4,651 Basic net income (loss) per share $ (0.00) $ (0.04) $ (0.18) $ 0.01 Diluted net income (loss) per share $ (0.00) $ (0.04) $ (0.18) $ 0.01 Shares used in basic net income (loss) per share calculations 482,440 476,677 480,948 475,529 Shares used in diluted net income (loss) per share calculations 482,440 476,677 480,948 484,680
Atmel Corporation Condensed Consolidated Balance Sheets (In thousands) (Unaudited)
September 30, December 31, 2005 2004 ------------- ------------- Current assets Cash and cash equivalents $ 282,388 $ 346,350 Short-term investments 52,569 58,858 Accounts receivable, net 236,194 228,544 Inventories 313,087 346,589 Other current assets 98,117 91,588 Total current assets 982,355 1,071,929 Fixed assets, net 969,353 1,204,852 Intangible and other assets 39,638 46,742 Total assets $ 1,991,346 $ 2,323,523 Current liabilities Current portion of long-term debt $ 126,679 $ 141,383 Convertible notes 221,021 -- Trade accounts payable 127,930 245,240 Accrued and other liabilities 197,497 208,942 Deferred income on shipments to distributors 15,655 18,124 Total current liabilities 688,782 613,689 Long-term debt less current portion 151,186 110,302 Convertible notes less current portion 291 213,648 Other long-term liabilities 256,161 274,288 Total liabilities 1,096,420 1,211,927 Stockholders' equity 894,926 1,111,596 Total liabilities and stockholders' equity $ 1,991,346 $ 2,323,523
SOURCE Atmel Corporation -0- 10/25/2005 /CONTACT: Steven Horwitz, Director, Investor Relations, of Atmel Corporation, +1-408-487-2677/ /Web site: http://www.atmel.com / (ATML)