EX-99.1 2 exhibit_99-1.htm EXHIBIT 99-1 PRESS RELEASE Q3FY10 exhibit_99-1.htm




PRESS RELEASE
 
FOR INFORMATION, CONTACT:
Greg Klaben
Vice President of Investor Relations
(831) 458-7533
 
 
FOR RELEASE at 1 P.M. PST
January 26, 2010
 
Plantronics Announces Third Quarter Fiscal 2010 Results
 
Results Exceed Guidance; Company Achieves Targeted Gross & Operating Margins

 
SANTA CRUZ, CA – January 26, 2010 - Plantronics, Inc. (NYSE: PLT) today announced third quarter fiscal 2010 net revenues of $165.9 million compared with $152.6 million in the third quarter of fiscal 2009.  Net revenues were above the previously provided guidance of $155 million to $160 million.  Plantronics' GAAP diluted earnings per share from continuing operations were $0.47 in the third quarter of fiscal 2010, compared with diluted earnings per share from continuing operations of $0.13 in the same quarter of the prior year.  Non-GAAP diluted earnings per share from continuing operations for the third quarter of fiscal 2010 were $0.50 compared with $0.14 in the third quarter of fiscal 2009 and were greater than the previously provided non-GAAP guidance of $0.38 to $0.42.  The difference between GAAP and non-GAAP earnings per share from continuing operations for the third quarter of fiscal 2010 includes stock-based compensation charges, purchase accounting amortization and restructuring and other related charges, all net of associated tax benefits along with the release of $1.2 million in tax reserves.
 
The Company completed the sale of Altec Lansing, its Audio Entertainment Group (“AEG”) segment, effective as of December 1, 2009.  All results of operations related to AEG including the loss on the sale are classified as discontinued operations for all periods presented.
 
Plantronics also announced that its Board of Directors declared a quarterly dividend of $0.05 per share. The dividend is payable on March 10, 2010 to stockholders of record at the close of business on February 19, 2010.
 
“Revenues were above expectations as we experienced better than expected demand in our Office & Contact Center product group, including Unified Communications solutions,” stated Ken Kannappan, President & CEO.  “Our margins improved as the result of prior cost reduction efforts combined with higher revenues.” 
 
 
Business Results (Non-GAAP from Continuing Operations)
 
Comparisons are to the Same Quarter in the Prior Year

Third quarter fiscal 2010 net revenues of $165.9 million increased 9% compared with $152.6 million in the prior year quarter.  Improved economic conditions led to increases in net revenues both year over year and sequentially in Office and Contact Center, Mobile, and Gaming & Computer Audio, while revenues from the Clarity group declined compared with the same quarter of the prior year.  Geographically, all regions grew year over year and sequentially, except for EMEA which declined year over year but grew by 34% from the previous quarter.

Office and Contact Center net revenues were $103.1 million, an increase of 1% from $101.7 million in the third quarter of fiscal 2009 and a sequential increase of 10% from $93.5 million in the second quarter of fiscal 2010.  Mobile headset net revenues were $47.0 million, an increase of 30% from the year ago quarter of $36.0 million, and a sequential increase of 35% from $34.7 million.

Gross margin in the third quarter of fiscal 2010 was 48.9% compared with 40.1% in the third quarter of the prior year and 48.7% in the second quarter of fiscal 2010.  The increase in the current quarter as compared to the same period in the prior year is primarily driven by the improved Bluetooth profitability as a result of outsourcing our manufacturing in fiscal 2010.  The sequential improvement was primarily driven by an improved product mix.
 
Operating expenses declined by 6% from $52.2 million in the prior year quarter to $49.2 million in the current quarter.  Operating income in the current quarter was $31.8 million compared with guidance of $26 million to $29 million, resulting in an operating margin of 19.2% as compared to operating income of $9.0 million and an operating margin of 5.9% in the prior year quarter.

 
Business Outlook
 
The following statements are based on our current expectations and many of these statements are forward-looking.  Actual results are subject to a variety of risks and uncertainties and may differ materially from our expectations.
 
Plantronics has a “book and ship” business model whereby it ships most orders to customers within 48 hours of its receipt of those orders and, therefore, the level of backlog does not provide reliable visibility into potential future revenues.  The Company’s business is inherently difficult to forecast, and there can be no assurance that the incoming orders it expects to receive over the balance of the quarter will materialize.  With continuing uncertainty resulting from the global economic conditions, the Company’s business remains difficult to forecast.  In addition, our incoming order rate tends to be low during the last two weeks of December and the first half of January and then rises significantly into February and March.  This pattern may be affected due to uncertainty of the strength of the economic recovery.  We have experienced a slow start to this quarter and we therefore must realize an increased incoming order flow for the balance of the quarter in order to achieve the revenue range we are projecting.
 
Net revenues in the fourth quarter of fiscal 2010 are expected to be lower than the third quarter of fiscal 2010 and higher than the fourth quarter of fiscal 2009.
 
Subject to the foregoing, we are currently expecting the following range of financial results for continuing operations for the fourth quarter of fiscal 2010:
 
·  
Net revenues of $150 million - $155 million; 
 
·  
Non-GAAP operating income of $27 million to $30 million;
 
·  
Non-GAAP earnings per share of $0.40 - $0.44;
 
·  
Non-GAAP tax rate to be approximately 26%;
 
·  
GAAP earnings per share of $0.35 to $0.39. 
 
If these results are achieved, the performance compared with fourth quarter of fiscal 2009 would be revenue growth of approximately 17% to 21%.
 
Plantronics does not intend to update these targets during the quarter or to report on its progress toward these targets.  Plantronics will not comment on these targets to analysts or investors except by its next press release announcing its fourth quarter fiscal 2010 results or by other public disclosure.  Any statements by persons outside Plantronics speculating on the progress of the fourth quarter fiscal 2010 will not be based on internal Company information and should be assessed accordingly by investors.
 
- 4 -
 
 
Conference Call Scheduled to Discuss Actual Financial Results
 
Plantronics has scheduled a conference call to discuss third quarter fiscal 2010 results.  The conference call will take place Tuesday, January 26th at 2:00 PM (PST).  All interested investors and potential investors in Plantronics stock are invited to participate.  To listen to the call, please dial in five to ten minutes prior to the scheduled starting time and refer to the "Plantronics Conference Call."  Participants from North America should call (888) 301-8736 and other participants should call (706) 634-7260.
 
A replay of the call with the conference ID #40971882 will be available for 72 hours at (800) 642-1687 for callers from North America and at (706) 645-9291 for all other callers.  The conference call will also be simultaneously web cast at www.plantronics.com under Investor Relations, and the web cast of the conference call will remain available at the Plantronics website for thirty days.
 
 
Use of Non-GAAP Financial Information
 
Plantronics excludes non-recurring transactions and non-cash expenses and charges such as restructuring and other related charges, the release of certain tax reserves, stock-based compensation expenses related to stock options, awards and employee stock purchases, purchase accounting amortization and impairment of goodwill and long-lived assets from non-GAAP income from continuing operations, non-GAAP earnings per diluted share from continuing operations, non-GAAP operating income, non-GAAP gross margin, non-GAAP operating margin and non-GAAP effective tax rate on continuing operations.  Plantronics excludes these expenses from its non-GAAP measures primarily because Plantronics does not believe they are reflective of ongoing operating results and are not considered as part of its target operating model.  Plantronics believes that the use of non-GAAP financial measures provides meaningful supplemental information regarding its performance and liquidity, and helps investors compare actual results to its long-term target operating model goals.  Plantronics believes that both management and investors benefit from referring to these non-GAAP financial measures in assessing its performance and when planning, forecasting and analyzing future periods.
 
 
Safe Harbor
 
This release contains forward-looking statements within the meaning of Section 27A of the Securities Exchange Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including statements relating to (i) our estimates of GAAP and non-GAAP financial results for the fourth quarter of fiscal 2010, including revenue and earnings per share; (ii) our estimated tax rate for the fourth quarter of fiscal 2010; (iii) our estimated stock-based compensation expense for the fourth quarter of fiscal 2010, as well as other matters discussed in this press release that are not purely historical data.  Plantronics does not assume any obligation to update or revise any such forward-looking statements, whether as the result of new developments or otherwise.
 
Forward-looking statements involve risks and uncertainties that may cause actual results to differ materially from those contemplated by such statements.  Among the factors that could cause actual results to differ materially from those contemplated are:
 
·  
economic conditions in both the domestic and international markets;
 
·  
fluctuations in foreign exchange rates;
 
·  
the bankruptcy or financial weakness of distributors or key customers, or the bankruptcy of or reduction in capacity of our key suppliers;
 
·  
the effect of restructuring actions on GAAP results;
 
·  
our ability to realize our Unified Communications (“UC”) plans and to achieve the financial results projected to arise from UC adoption could be adversely affected by the following factors: (i) as UC becomes more widely adopted, the risk that competitors will offer solutions that will effectively commoditize our headsets which, in turn, will reduce the sales prices for our headsets; (ii) our plans are dependent upon adoption of our UC solution by major platform providers such as Microsoft, Avaya, IBM and Cisco, and we have a limited ability to influence such providers with respect to the functionality of their platforms, their rate of deployment, and their willingness to integrate their platforms with our solutions; (iii) the development of UC solutions is technically complex and this may delay or obstruct our ability to introduce solutions to the market on a timely basis and that are cost effective, feature rich, stable and attractive to our customers; (iv) as UC becomes more widely adopted we anticipate that competition for market share will increase, and some competitors may have superior technical and economic resources; (v) UC solutions may not be adopted with the breadth and speed in the marketplace that we currently anticipate, and (vi) our support expenditures may substantially increase over time due to the complex nature of the platforms developed by the major UC providers as these platforms continue to evolve and become more commonly adopted;
 
·  
failure to match production to demand given long lead times and the difficulty of forecasting unit volumes and acquiring the component parts to meet demand without having excess inventory or incurring cancellation charges;
 
·  
further impairment losses on the carrying value of our intangible assets and goodwill could be recognized if it is determined the value is not recoverable which would adversely affect our financial results;
 
·  
volatility in prices from our suppliers, including our manufacturers located in China, have and could negatively affect our profitability and/or market share;
 
·  
the effects of the sale of AEG, including the level of cash flow and the timing of the receipt of any cash flow resulting from such sale are uncertain; and
 
·  
additional risk factors including: interruption in the supply of sole-sourced critical components, continuity of component supply at costs consistent with our plans, the inherent risks of our substantial foreign operations, and problems which might affect our manufacturing facilities in Mexico, and unexpected delays and uncertainties affecting our ability to realize targeted expense reductions and annualized savings by outsourcing the manufacturing of our Bluetooth products in China to GoerTek, Inc.
 
For more information concerning these and other possible risks, please refer to the Company’s Annual Report on Form 10-K filed May 26, 2009, quarterly reports filed on Form 10-Q and other filings with the Securities and Exchange Commission as well as recent press releases. These filings can be accessed over the Internet at http://www.sec.gov/edgar/searchedgar/companysearch.html.
 
 
Financial Summaries
 
The following related charts are provided:
 
 

About Plantronics
 
Plantronics is a world leader in personal audio communications for professionals and consumers. From unified communication solutions to Bluetooth headsets, Plantronics delivers unparalleled audio experiences and quality that reflect our nearly 50 years of innovation and customer commitment. Plantronics is used by every company in the Fortune 100 and is the headset of choice for air traffic control, 911 dispatch and the New York Stock Exchange. For more information, please visit www.plantronics.com or call (800) 544-4660.
 
Plantronics, the logo design, Clarity and Savi are trademarks or registered trademarks of Plantronics, Inc.  The Bluetooth name and the Bluetooth trademarks are owned by Bluetooth SIG, Inc. and are used by Plantronics, Inc. under license.  All other trademarks are the property of their respective owners.
 
 
###
 

PLANTRONICS, INC. / 345 Encinal Street / P.O. Box 1802 / Santa Cruz, California 95061-1802
831-426-6060 / Fax 831-426-6098
 
  - 5 -
 


                         
 
SUMMARY CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
  
(in thousands, except per share data and percentages)
  
                         
 
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
  
 
 
                
                         
   
Three Months Ended
    
Nine Months Ended
   
December 31,
    
December 31,
   
2008
    
2009
    
2008
    
2009
  
                         
Net revenues
$
           152,616
  
$
           165,935
  
$
           546,492
  
$
           451,555
  
Cost of revenues
  
             92,199
    
             85,566
    
           304,159
    
           238,251
  
Gross profit
  
             60,417
    
             80,369
    
           242,333
    
           213,304
  
    Gross profit %
  
39.6
 %   
48.4%
    
44.3
 %   
47.2
 % 
                         
Research, development and engineering
  
             16,645
    
             14,780
    
             50,721
    
             41,991
  
Selling, general and administrative
  
             38,579
    
             37,502
    
           123,887
    
           103,599
  
Restructuring and other related charges
  
                  288
    
                  332
    
                  288
    
               1,767
  
    Total operating expenses
  
             55,512
    
             52,614
    
           174,896
    
           147,357
  
        Operating income
  
               4,905
    
             27,755
    
             67,437
    
             65,947
  
        Operating income %
  
3.2
 %   
16.7
 %  
12.3
 %   
14.6
 % 
                         
Interest and other income (expense), net
  
              (1,499
 )   
               1,422
    
              (3,129
 )   
               3,653
  
Income from continuing operations before income taxes
               3,406
    
             29,177
    
             64,308
    
             69,600
  
Income tax expense (benefit) from continuing operations
 
              (2,748
 )   
               5,974
    
             11,464
    
             17,562
  
    Income from continuing operations, net of tax
  
               6,154
    
             23,203
    
             52,844
    
             52,038
  
Discontinued operations:
                        
    Loss from operations of discontinued AEG segment (including loss on sale of AEG)
          (124,418
 )   
                 (515
 )   
          (137,221
 )   
            (30,292
 ) 
    Income tax benefit on discontinued operations
  
            (26,255
 )   
                 (562
 )   
            (30,510
 )  
            (11,408
 ) 
         Income (loss) on discontinued operations
  
            (98,163
 )   
                    47
    
          (106,711
 )   
            (18,884
 ) 
       Net income (loss)
$
            (92,009
 ) 
$
             23,250
  
$
            (53,867
 ) 
$
             33,154
  
                         
      % of net revenues
  
(60.3)
 %   
14.0
 %   
(9.9)
 %   
7.3
 % 
                         
Earnings (loss) per common share:
                        
    Basic
                        
     Continuing operations
$
                 0.13
  
$
                 0.48
  
$
                 1.09
  
$
                 1.07
  
     Discontinued operations
$
                (2.03
 ) 
$
                 0.00
  
$
                (2.19
 ) 
$
                (0.39
 ) 
       Net income (loss)
$
                (1.90
 ) 
$
                 0.48
  
$
                (1.11
 ) 
$
                 0.68
  
                         
    Diluted
                        
        Continuing operations
$
                 0.13
  
$
                 0.47
  
$
                 1.08
  
$
                 1.06
  
        Discontinued operations
$
                (2.02
 ) 
$
                 0.00
  
$
                (2.17
 ) 
$
                (0.38
 ) 
      Net income (loss)
$
                (1.90
 ) 
$
                 0.47
  
$
                (1.10
 ) 
$
                 0.67
  
                         
Shares used in computing earnings (loss) per share:
                      
    Basic
  
             48,449
    
             48,632
    
             48,641
    
             48,632
  
    Diluted
  
             48,522
    
             49,625
    
             49,113
    
             49,304
  
                         
Tax rate from continuing operations
  
(80.7)
 %   
20.5
 %   
17.8
 %   
25.2
 % 
                         

 
- 6 -

 
             
PLANTRONICS, INC.
  
SUMMARY CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
  
(in thousands, except per share data and percentages)
  
             
             
UNAUDITED CONSOLIDATED BALANCE SHEETS
            
             
   
March 31,
    
December 31,
  
   
2009
    
2009
  
ASSETS
            
Cash and cash equivalents
   $ 158,193     $ 283,503  
Short-term investments
     59,987       33,222  
Total cash, cash equivalents, and short-term investments
     218,180       316,725  
Accounts receivable, net
     83,657       113,291  
Inventory, net
     119,296       70,914  
Deferred income taxes
     12,486       10,097  
Other current assets
     29,936       33,219  
Assets held for sale
     -       8,926  
Total current assets
     463,555       553,172  
Long-term investments
     23,718       -  
Property, plant and equipment, net
     95,719       67,866  
Intangibles, net
     26,575       3,758  
Goodwill
     14,005       14,005  
Other assets
     9,548       3,168  
Total assets
   $ 633,120     $ 641,969  
                 
LIABILITIES AND STOCKHOLDERS' EQUITY
                
Accounts payable
   $ 32,827     $ 31,397  
Accrued liabilities
     53,143       56,993  
Total current liabilities
     85,970       88,390  
Deferred tax liability
     8,085       58  
Long-term income taxes payable
     12,677       13,506  
Other long-term liabilities
     1,021       958  
Total liabilities
     107,753       102,912  
Stockholders' equity
     525,367       539,057  
Total liabilities and stockholders' equity
   $ 633,120     $ 641,969  
                 

  - 7 -
 
 

 
                                   
 
UNAUDITED GAAP TO NON-GAAP RECONCILIATION
  
(in thousands, except per share data and percentages)
  
                                   
 
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
  
 
  
 
 
                    
 
Three Months Ended
  
Nine Months Ended
 
December 31, 2009
  
December 31, 2009
 
GAAP
  
Excluded
  
Non-GAAP
  
GAAP
  
Excluded
  
Non-GAAP
                                   
Net revenues
 $ 165,935     $   -     $ 165,935     $ 451,555     $   -     $ 451,555  
Cost of revenues
   85,566       (698 ) (1)   84,868       238,251       (7,202 )  (2)   231,049  
Gross profit
   80,369       698       81,067       213,304       7,202       220,506  
Gross profit %
   48.4 %             48.9 %     47.2 %             48.8 %
                                               
Research, development and engineering
   14,780       (825 )  (1)   13,955       41,991       (2,453 )  (1)   39,538  
Selling, general and administrative
   37,502       (2,219 )  (1)   35,283       103,599       (6,435 )  (1)   97,164  
Restructuring and other related charges
   332       (332 )  (3)   -       1,767       (1,767 )  (3)   -  
Total operating expenses
   52,614       (3,376 )     49,238       147,357       (10,655 )     136,702  
Operating income
   27,755       4,074       31,829       65,947       17,857       83,804  
Operating income %
   16.7 %             19.2 %     14.6 %             18.6 %
                                               
Interest and other income (expense), net
   1,422       -       1,422       3,653       -       3,653  
Income from continuing operations before income taxes
   29,177       4,074       33,251       69,600       17,857       87,457  
Income tax expense from continuing operations
   5,974       2,303    (4)   8,277       17,562       4,826    (4)   22,388  
Income from continuing operations, net of tax
 $ 23,203     $ 1,771     $ 24,974     $ 52,038     $ 13,031     $ 65,069  
                                               
% of net revenues
   14.0 %             15.1 %     11.5 %             14.4 %
                                               
Diluted earnings per common share from continuing operations
 $ 0.47             $ 0.50     $ 1.06             $ 1.32  
Shares used in diluted per share calculations
   49,625               49,625       49,304               49,304  
                                               
 
(1) Excluded amount represents stock-based compensation and purchase accounting amortization.
        
(2) Excluded amount represents stock-based compensation, purchase accounting amortization and $5,205 of accelerated depreciation on assets related to restructuring activity.
(3) Excluded amount represents restructuring and other related charges.
                          
(4) Excluded amount represents tax benefit from stock-based compensation, purchase accounting amortization and restructuring and other related charges and $1,156 related to a tax benefit from expiration
    of certain statutes of limitations.
                  
                                                 
Use of Non-GAAP Financial Information
                                                
To supplement our consolidated financial statements presented on a GAAP basis, Plantronics uses non-GAAP measures of operating results from continuing operations, which are adjusted to exclude non-recurring and non-cash expenses and charges, such as restructuring and other related charges, certain tax credits and the release of certain tax reserves, stock-based compensation expenses related to stock options, awards and employee stock purchases, purchase accounting amortization and impairment of goodwill and long-lived assets. Plantronics does not believe these expenses and charges are reflective of ongoing operating results and are not part of our target operating model.  We have presented non-GAAP statements that only show our results to the income from continuing operations after tax line. The non-GAAP financial measures should not be considered a substitute for, or superior to, financial measures calculated in accordance with GAAP, and the financial results calculated in accordance with GAAP and the reconciliations to those financial statements should be carefully evaluated.  The non-GAAP financial measures used by Plantronics may be calculated differently from, and therefore may not be comparable to, similarly titled measures used by other companies.

  - 8 -
 
 


                                     
PLANTRONICS, INC.
  
UNAUDITED GAAP TO NON-GAAP RECONCILIATION
  
(in thousands, except per share data and percentages)
  
                                     
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
                              
   
Three Months Ended
    
Nine Months Ended
  
   
December 31, 2008
    
December 31, 2008
  
   
GAAP
  
Excluded
  
Non-GAAP
  
GAAP
  
Excluded
  
Non-GAAP
                                     
Net revenues
   $ 152,616     $ -     $ 152,616     $ 546,492     $ -     $ 546,492  
Cost of revenues
     92,199       (758 )  (1)   91,441       304,159       (2,549 )  (1)   301,610  
Gross profit
     60,417       758       61,175       242,333       2,549       244,882  
Gross profit %
     39.6 %             40.1 %     44.3 %             44.8 %
                                                 
Research, development and engineering
     16,645       (821 )  (1)   15,824       50,721       (2,815 )  (1)   47,906  
Selling, general and administrative
     38,579       (2,224 )  (1)   36,355       123,887       (7,389 )  (1)   116,498  
Restructuring and other related charges
     288       (288 )  (2)   -       288       (288 )  (2)   -  
Total operating expenses
     55,512       (3,333 )     52,179       174,896       (10,492 )     164,404  
Operating income
     4,905       4,091       8,996       67,437       13,041       80,478  
Operating income %
     3.2 %             5.9 %     12.3 %             14.7 %
                                                 
Interest and other income (expense), net
     (1,499 )     -       (1,499 )     (3,129 )     -       (3,129 )
Income from continuing operations before income taxes
     3,406       4,091       7,497       64,308       13,041       77,349  
Income tax expense (benefit) from continuing operations
     (2,748 )     3,241    (3)   493       11,464       7,910    (4)   19,374  
Income from continuing operations, net of tax
   $ 6,154     $ 850     $ 7,004     $ 52,844     $ 5,131     $ 57,975  
                                                 
% of net revenues
     4.0 %             4.6 %     9.7 %             10.6 %
                                                 
Diluted earnings per common share from continuing operations
   $ 0.13             $ 0.14     $ 1.08             $ 1.18  
Shares used in diluted per share calculations
     48,522               48,522       49,113               49,113  
                                                 
 
(1) Excluded amount represents stock-based compensation and purchase accounting amortization.
                          
(2) Excluded amount represents restructuring and other related charges.
                                        
(3) Excluded amount represents tax benefit from stock-based compensation, purchase accounting amortization and restructuring and other related charges and $2,078 related to a tax benefit from expiration
    of certain statutes of limitations.
                                
(4) Excluded amount represents tax benefit from stock-based compensation, purchase accounting amortization and restructuring and other related charges and $3,813 related to a tax benefit from expiration
    of certain statutes of limitations.
                                
                                                 
Use of Non-GAAP Financial Information
                                                
To supplement our consolidated financial statements presented on a GAAP basis, Plantronics uses non-GAAP measures of operating results from continuing operations, which are adjusted to exclude non-recurring and non-cash expenses and charges, such as restructuring and other related charges, certain tax credits and the release of certain tax reserves, stock-based compensation expenses related to stock options, awards and employee stock purchases, purchase accounting amortization and impairment of goodwill and long-lived assets. Plantronics does not believe these expenses and charges are reflective of ongoing operating results and are not part of our target operating model.  We have presented non-GAAP statements that only show our results to the income from continuing operations after tax line.  The non-GAAP financial measures should not be considered a substitute for, or superior to, financial measures calculated in accordance with GAAP, and the financial results calculated in accordance with GAAP and the reconciliations to those financial statements should be carefully evaluated.  The non-GAAP financial measures used by Plantronics may be calculated differently from, and therefore may not be comparable to, similarly titled measures used by other companies.

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(in thousands, except per share data, percentages, DSO, and Inventory turns)
          
                                 
    Q109     Q209     Q309     Q409  
FY09
     Q110     Q210     Q310  
Net revenues
 $ 198,527   $ 195,349   $ 152,616   $ 128,098   $ 674,590   $ 141,162   $ 144,458   $ 165,935  
Cost of revenues
   108,449     101,720     91,441     77,834     379,444     72,036     74,145     84,868  
Gross profit
   90,078     93,629     61,175     50,264     295,146     69,126     70,313     81,067  
Gross profit %
   45.4  %   47.9  %   40.1  %   39.2  %   43.8  %   49.0  %   48.7  %   48.9 %
                                                 
Research, development and engineering
   16,204     15,878     15,824     12,247     60,153     12,850     12,733     13,955  
Selling, general and administrative
   40,369     39,774     36,355     29,629     146,127     31,058     30,823     35,283  
Operating expenses
   56,573     55,652     52,179     41,876     206,280     43,908     43,556     49,238  
                                                 
Operating income
   33,505     37,977     8,996     8,388     88,866     25,218     26,757     31,829  
Operating income %
   16.9  %   19.4  %   5.9  %   6.5  %   13.2  %   17.9  %   18.5  %   19.2 %
                                                 
Income from continuing operations before income taxes
   35,045     34,807     7,497     7,973     85,322     26,565     27,641     33,251  
Income tax expense from continuing operations
   8,763     10,118     493     4,396     23,770     7,172     6,939     8,277  
Income tax expense as a percent
                                                
  of income from continuing operations before taxes
   25.0  %   29.1  %   6.6  %   55.1  %   27.9 %   27.0  %   25.1  %   24.9 %
                                                 
Income from continuing operations, net of tax
 $ 26,282   $ 24,689   $ 7,004   $ 3,577   $ 61,552   $ 19,393   $ 20,702   $ 24,974  
                                                 
Diluted EPS - Continuing operations
 $  0.53   $  0.50   $ 0.14   $ 0.07   $ 1.26   $ 0.40   $ 0.42   $ 0.50  
Diluted shares outstanding
   49,245     49,489     48,522     48,431     48,947     48,665     49,567     49,625  
                                                 
Net revenues from unaffiliated customers:
                                                
  Office and Contact Center
 $ 122,803   $ 119,530   $ 101,694   $ 85,642   $ 429,669   $ 95,923   $ 93,503   $ 103,096  
  Mobile
   59,882     60,911     36,011     30,615     187,419     32,310     34,665     46,951  
  Gaming and Computer Audio
   9,621     8,977     8,531     6,923     34,052     8,810     9,015     11,072  
  Clarity
   6,221     5,931     6,380     4,918     23,450     4,119     7,275     4,816  
                                                 
Net revenues by geographic area
                                                
 from unaffiliated customers:
                                                
   Domestic
 $ 123,603   $ 129,789   $ 91,594   $ 79,304   $ 424,290   $ 88,789   $ 93,370   $ 99,157  
   International
   74,924     65,560     61,022     48,794     250,300     52,373     51,088     66,778  
                                                 
Balance Sheet accounts and metrics:
                                                
Accounts receivable, net 1
 $ 130,530   $ 115,032   $ 106,463   $ 83,657   $ 83,657   $ 88,350   $ 103,003   $ 113,291  
Days sales outstanding (DSO) 1
   59     54     63     59           56     64     61  
Inventory, net (2)
 $ 116,379   $ 135,736   $ 114,423   $ 100,171   $ 100,171   $ 90,258   $ 78,026   $ 70,914  
Inventory turns (2)
   3.7     3.0     3.2     3.1           3.2     3.8     4.8  
                                                 
1  Accounts receivable, net is presented on a consolidated basis including discontinued operations as Plantronics does not maintain balance by segment; DSO is calculated on revenues from continuing operations and consolidated Accounts receivable.
  
2 Inventory, net and inventory turns reflect amounts in continuing operations only.
  
 
                                                


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