EX-99.1 2 a4690603ex99.txt EXHIBIT 99.1 PRESS RELEASE Exhibit 99.1 Alliance Semiconductor Reports Financial Results for the First Fiscal Quarter Ended June 30, 2004 SANTA CLARA, Calif.--(BUSINESS WIRE)--July 28, 2004--Alliance Semiconductor Corporation (Nasdaq:ALSC) today reported financial results for the first fiscal quarter of 2005 ended June 30, 2004. First Quarter Highlights -- Increased overall revenue by 41% year-over-year -- Increased Analog and Mixed Signal revenues sequentially by 40% and introduced 36 new products -- EE Times selected the HyperTransport-to-PCI-X Bridge product as one of the top 10 Logic and Programmable Logic products introduced during the first quarter of 2004. -- Announced the availability of an extensive family of IEEE 1149.1 compliant JTAG devices -- Achieved initial design win and qualification for its 36Mb Synchronous SRAM -- Generated 19 new design wins across all of its business units -- Announced plans to continue expansion of its India Design Center with an investment of up to $50 million over the next five years The Company reported revenues of $7.1 million, compared to $8.9 million in the previous quarter and $5.1 million for the first quarter of fiscal 2004. Revenue from the non-memory business units represented approximately 39% of total revenue in the first quarter, compared to 35% in the previous quarter. "We are pleased with the number of new product introductions and design wins achieved during the quarter, particularly within our Analog and Mixed Signal Business Unit. This business unit achieved significant revenue growth during the quarter, introduced more than 30 new products, broadened its customer base and continued to address an increasing number of end market applications. We expect the momentum created by this business unit to continue and be a strong contributor to growth in the coming quarters," said N.D. Reddy, Alliance chairman, president and CEO. "While our memory business experienced a sequential decrease in revenue during the quarter, due in part to our inability to meet demand, we are encouraged by the activity across the product line, including initial qualification opportunities and design win activity with our industry leading 36Mb synchronous SRAM offering." Net loss for the first quarter was $6.6 million or ($0.19) per share, compared to a net income of $4.8 million or $0.13 per share for the previous quarter, and a net loss of $13.0 million or ($0.37) per share for the first quarter of fiscal 2004. During the quarter the Company took a charge of $2.9 million against its 18Mb synchronous SRAM products. The charge is based on the Company's current forecast for these products and is reflected in cost of revenues for the current quarter. Operating expenses for the quarter were $8.0 million, compared to $9.1 million in the previous quarter and $10.6 million for the first quarter of fiscal 2004. Business Summary During the quarter, Alliance announced the availability of its first 13 CPU supervisor product families. Each of the 13 product families come with multiple package and reset voltage combinations that spawn 125 distinct products. These products are a low-power and cost effective alternative to industry standard CPU supervisors, addressing the 5V, 3.3V and 3V applications in wire-line and wireless telecom, computer, consumer, industrial and medical markets. The Company also introduced its extensive family of IEEE 1149.1 compliant JTAG devices. These products provide very efficient solutions to implement design-for-test (DFT) on the PCB for the networking, communications, storage, compute and embedded systems. Alliance's JTAG products allow leading OEM partners to develop highly integrated IEEE 1149.1 test strategies at the board, system and sub module levels. The integration of Alliance's JTAG products enable system engineers to reduce Flash memory and CPLD/FPGA programming time, while providing higher fault coverage and system diagnostics in the factory and in the field. Also in the quarter, Alliance announced that it is planning to invest up to $50 million in its India Design Center over the next five years to expand its engineering and deployment services and further its market expansion. The Company plans to undertake a significant amount of recruitment in India this year at the Bangalore and Hyderabad design centers enabling Alliance to double its engineering staff, from 150 to 300, over the next three years. 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 2005 during the earnings conference call at 2:00 p.m. PT on July 28, 2004. First Quarter 2005 Financial Results Webcast/Conference Call The Alliance management team will host a live web cast and conference call to discuss the first quarter financial results beginning at 2:00 p.m. PT on Wednesday, July 28, 2004. Investors and other interested parties may participate in the call by dialing 800-299-8538 at least fifteen minutes prior to the call and enter pass code 59149180 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 (Nasdaq:ALSC) is powering every application with high performance solutions for the communications, computing and consumer electronics markets. Utilizing advanced process technologies and design expertise, Alliance provides leading OEMs with a broad portfolio of complementary technologies including analog and mixed-signal products, chip-to-chip connectivity products, networking controllers and high-performance memories. Alliance addresses the complete needs of system developers by leveraging its proprietary advances in Electromagnetic Interference (EMI) reduction, power management and timing technology, HyperTransport(TM) I/O connectivity and specialized memory solutions for next-generation applications. Founded in 1985, Alliance is headquartered in Santa Clara, Calif. with design centers in Bangalore and Hyderabad, India. The company is publicly traded and included in the S&P 600 Index. Additional information is available on the Alliance 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, 2004, 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 STATEMENTS OF OPERATIONS (in thousands, except per share data) (unaudited) Three Months Ended June 30, ----------------------------- 2004 2003 --------------- ------------- Net revenues $7,136 $5,074 Cost of revenues 7,559 3,245 --------------- ------------- Gross profit (loss) (423) 1,829 --------------- ------------- Operating expenses: Research and development 4,740 6,599 Selling, general and administrative 3,263 3,992 --------------- ------------- Total operating expenses 8,003 10,591 --------------- ------------- Loss from operations (8,426) (8,762) Gain on investments 3,470 346 Writedown of marketable securities and venture investments 0 (403) Loss in investees accounted for under the equity method (3,641) (5,497) Other expense, net (339) (911) --------------- ------------- Loss before income taxes and minority interest in consolidated subsidiaries (8,936) (15,227) Benefit for income taxes (2,261) (1,718) --------------- ------------- Loss before minority interest in consolidated subsidiaries (6,675) (13,509) Minority interest in consolidated subsidiaries 44 478 --------------- ------------- Net loss ($6,631) ($13,031) =============== ============= Net loss per share: Basic and diluted ($0.19) ($0.37) =============== ============= Weighted average number of common shares: Basic and diluted 35,262 34,988 =============== ============= CONDENSED CONSOLIDATED BALANCE SHEETS (in thousands) (unaudited) June March 2004 2004 --------------- -------------- ASSETS Current assets: Cash and cash equivalents $2,177 $6,107 Short term investments 127,077 159,778 Accounts receivable, net 3,112 4,081 Inventory 11,705 11,609 Other current assets 1,510 3,111 --------------- -------------- Total current assets 145,581 184,686 Property and equipment, net 5,610 6,161 Investment in Tower Semiconductor Corporation 21,208 21,208 (excluding short term portion) Alliance Ventures and other investments 36,495 36,082 Other non-current assets 11,649 12,665 --------------- -------------- Total assets $220,543 $260,802 =============== ============== LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable $6,721 $9,406 Accrued liabilities 2,088 2,881 Income taxes payable 32,916 33,766 Deferred income taxes 26,237 38,921 Short term borrowings and current portion of long term obligations 26 33 --------------- -------------- Total current liabilities 67,988 85,007 Long term liabilities: Long term obligations 226 241 --------------- -------------- Total liabilities 68,214 85,248 --------------- -------------- Minority interest in consolidated subsidiaries 774 832 --------------- -------------- Stockholders' equity: Common stock 435 435 Additional paid-in capital 132,386 132,146 Retained earnings (532) 6,099 Accumulated other comprehensive income 19,266 36,042 --------------- -------------- Total stockholders' equity 151,555 174,722 --------------- -------------- Total liabilities and stockholders' equity $220,543 $260,802 =============== ============== CONTACT: Alliance Semiconductor Corporation, Santa Clara Ron Shelton, 408-855-4958 rshelton@alsc.com or Investor Contact: Shelton Investor Relations Barry Sievert, 972-239-5119 Ext. 134 bsievert@sheltongroup.com