EX-99 3 a4500739_ex991.txt ALLIANCE SEMICONDUCTOR EXHIBIT 99.1 Exhibit 99.1 Alliance Semiconductor Reports Financial Results for the Second Quarter Ended September 30, 2003 SANTA CLARA, Calif.--(BUSINESS WIRE)--Oct. 23, 2003--Alliance Semiconductor Corporation (Nasdaq:ALSC) today reported financial results for the second fiscal quarter of 2004 ended September 30, 2003. Second Quarter Highlights -- Increased total revenue by 10% sequentially and 37% over the prior year's results -- Increased Analog and Mixed Signal revenues by 45% on a sequential basis and introduced 8 new products -- Maintained a leadership position in the high growth, low power/low voltage markets through design wins in the display markets with our 2.5-volt analog and mixed signal devices -- Secured 38 new customer qualifications for our Synchronous SRAM product family -- Achieved volume production with 9M and 18M Synchronous SRAM products, driving a 23% sequential increase in SRAM revenue -- Penetrated the rapidly growing VDSL modem market in Japan, Korea & Taiwan -- Engaged a Tier 1 customer with our Resilient Packet Ring (RPR) controller family -- Increased design wins for automotive, printing, telecommunications, networking and consumer audio applications The Company reported revenues of $5.6 million, compared to $5.1 million in the previous quarter and $4.1 million for the second quarter of 2003. Revenue from the non-memory business units represented approximately 35% of total revenue, compared to 32% in the previous quarter. The net loss for the second quarter was $4.5 million or ($0.13) per share, compared to a net loss of $13 million or ($0.37) per share for the previous quarter, and a net loss of $21.7 million or ($0.56) per share for the second quarter 2003. Operating expenses for the quarter were $11.0 million, compared to $10.6 million in the previous quarter and $11.1 million for the second quarter of fiscal 2003. "The growth in revenues this quarter was driven primarily from the Analog and Mixed Signal and the Memory business units, the most significant of which was derived from increased customer traction with major OEMs for our 9M and 18M Synchronous SRAM products," said N.D. Reddy, Alliance chairman, president and CEO. "During the quarter, Alliance further penetrated high growth markets such as the power management, notebook and automotive markets, with the introduction of several new products. These products are complementary to our existing product offerings and enable us to provide more comprehensive solutions to our customers." Mr. Reddy continued, "We anticipate the momentum in our Memory and Mixed Signal business units to continue into the next quarter with a more significant contribution from System Solutions in 2004. We are well positioned to increase our leadership in the market by being the premier provider of mixed signal, system solutions and high-value memory products." Business Outlook Alliance President and Chief Executive Officer, N.D. Reddy, and Chief Financial Officer, Ron Shelton will update the business outlook and give guidance for the second quarter of fiscal 2004 during the earnings conference call at 2:00 PT on October 23, 2003. Second Quarter 2004 Financial Results Web cast/Conference Call The Alliance management team will host a live web cast and conference call to discuss the second quarter financial results beginning at 2:00 P.M. (PT) on Thursday, October 23, 2003. Investors and other interested parties may participate in the call by dialing 888-343-7141 at least fifteen minutes prior to the call and enter pass code 21162801 or listen to the live web cast by visiting the investor relations section of the Alliance website at www.alsc.com. About Alliance: Alliance Semiconductor Corporation is a leading worldwide provider of memory, analog and mixed signal and systems solutions for networking, wireless, consumer and computing markets. Through these integrated business units, Alliance provides leading OEMs with synchronous and fast asynchronous SRAMs, high-speed chip-to-chip interconnects based on HyperTransport(TM) technology and analog and mixed signal products for Electromagnetic Interference (EMI) management. Alliance develops and manufactures its products through independent manufacturing foundries using advanced CMOS process technologies with line widths as narrow as 0.13-microns. Alliance, founded in 1985 and headquartered in Santa Clara, California, is traded on the NASDAQ Stock Market under the ALSC symbol and is included in the S&P 600 Index. Additional information is available on Alliance's Web site at: http://www.alsc.com. Forward-Looking Statements Except for historical information, the above statements of this press release are forward-looking statements that are subject to certain risks and uncertainties that could cause actual results to differ materially from those set forth in the forward looking statements. These risks and uncertainties include such factors, among others, as further significant price erosion of the Company's products; continued significantly decreased demand and increased competitive environment for the Company's products; the Company's potential status as an Investment Act of 1940 reporting company; obsolescence of the Company's products; further accumulation of excess inventory or price erosion or obsolescence of existing inventory, any of which may result in charges against the Company's earnings; inability to timely ramp up production of and deliver new or enhanced products; inability to successfully recruit and retain qualified technical and other personnel; adverse developments in current or future litigation or administrative proceedings; further diminution in value of investments made by Alliance or by Alliance Venture Management, LLC; continued cancellation of orders in the Company's backlog and the risk factors listed in the Company's Form 10-K for the fiscal year ended March 30, 2003, which has been filed with the Securities and Exchange Commission, and which is available through the Company's home page, www.alsc.com. These forward-looking statements speak only as of the date of this press release. The Company expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in the Company's expectations with regard thereto or to reflect any change in events, conditions or circumstances on which any such forward-looking statement is based. ALLIANCE SEMICONDUCTOR CORPORATION CONDENSED CONSOLIDATED BALANCE SHEETS (in thousands) (unaudited) September March 2003 2003 ----------- --------- ASSETS Current assets: Cash and cash equivalents $3,514 $8,642 Short term investments 199,247 148,711 Accounts receivable, net 2,749 2,058 Inventory 5,573 2,862 Other current assets 4,189 5,154 ------------ ---------- Total current assets 215,272 167,427 Property and equipment, net 7,411 8,205 Investment in Tower Semiconductor Corporation 17,298 15,822 (excluding short term portion) Alliance Ventures LP and other investments 39,401 38,319 Other non-current assets 13,054 15,408 ------------ ---------- Total assets $292,436 $245,181 ============ ========== Current liabilities: Accounts payable $5,070 $4,298 Accrued liabilities 5,275 5,053 Income taxes payable 15,750 4,520 Deferred income taxes 43,634 23,840 Short term borrowings and current portion of long term obligations 38,695 46,009 ------------ ---------- Total current liabilities 108,424 83,720 Long term liabilities: Long term obligations 708 1,326 Deferred income taxes 1,627 0 ------------ ---------- Total liabilities 110,759 85,046 ------------ ---------- Minority interest in consolidated subsidiaries 1,026 915 ------------ ---------- Stockholders' equity: Common stock 433 432 Additional paid-in capital 131,465 131,175 Retained earnings 7,939 25,510 Accumulated other comprehensive income 40,814 2,103 ------------ ---------- Total stockholders' equity 180,651 159,220 ------------ ---------- $292,436 $245,181 ============ ========== ALLIANCE SEMICONDUCTOR CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except per share data) (unaudited) (unaudited) Three Months Ended Six Months Ended September 30, September 30, ------------------ ------------------ 2003 2002 2003 2002 -------- --------- -------- --------- Net revenues $5,561 $4,096 $10,635 $8,394 Cost of revenues 4,218 15,061 7,463 30,075 -------- --------- -------- --------- Gross profit (loss) 1,343 (10,965) 3,172 (21,681) -------- --------- -------- --------- Operating expenses: Research and development 6,472 6,109 13,071 10,624 Selling, general and administrative 4,479 5,034 8,471 9,584 -------- --------- -------- --------- Total operating expenses 10,951 11,143 21,542 20,208 -------- --------- -------- --------- Loss from operations (9,608) (22,108) (18,370) (41,889) Gain on investments 4,725 3,237 3,973 15,292 Writedown of marketable securities and venture investments (555) (7,930) (958) (18,931) Other expense, net (2,028) (2,639) (2,939) (3,429) -------- --------- -------- --------- Loss before income taxes and equity in loss of investees (7,466) (29,440) (18,294) (48,957) Benefit for income taxes (5,784) (9,430) (5,962) (15,600) -------- --------- -------- --------- Loss before minority interest in consolidated subsidiaries and equity in loss of investees (1,682) (20,010) (12,332) (33,357) Minority interest in consolidated subsidiaries 93 1,330 571 1,858 Equity in loss of investees (2,951) (2,999) (5,810) (5,443) -------- --------- -------- --------- Net loss ($4,540) ($21,679) ($17,571) ($36,942) ======== ========= ======== ========= Net loss per share: Basic ($0.13) ($0.56) ($0.50) ($0.94) ======== ========= ======== ========= Diluted ($0.13) ($0.56) ($0.50) ($0.94) ======== ========= ======== ========= Weighted average number of common shares: Basic 35,033 38,657 35,011 39,269 ======== ========= ======== ========= Diluted 35,033 38,657 35,011 39,269 ======== ========= ======== ========= CONTACT: Alliance Semiconductor Corporation Ron Shelton, 408-855-4958 rshelton@alsc.com or Investor Contact: Shelton Investor Relations Stephanie Elwood, 972-239-5119, ext. 115 selwood@sheltongroup.com