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Applied Micro Circuits Corporation Reports First Quarter Fiscal 2015 Financial Results

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SUNNYVALE, Calif., July 29, 2014 (GLOBE NEWSWIRE) -- Applied Micro Circuits Corporation (Nasdaq:AMCC) ("AppliedMicro") today reported its financial results for the first quarter of fiscal 2015, ended June 30, 2014.

  • Consolidated net revenue of $50.3 million
  • GAAP net loss of $13.1 million or $0.17 per share
  • Non-GAAP net income of $0.2 million or $0.00 earnings per share

Commenting on AppliedMicro's first quarter operations, Dr. Paramesh Gopi, President and Chief Executive Officer, said, "We are very pleased to report that we have shipped initial production X-Gene™ units. Purchase orders continue to grow and backlog is building. The creation of the ARM 64-bit based server category is underway." Dr. Gopi continued, "We experienced strong demand for our connectivity products while we saw a sharp decline in legacy PowerPC embedded products. The contributions of the base business continue to support our growth initiatives."

AppliedMicro provides non-GAAP results as additional information relating to its financial condition and business trends. This information should be considered in conjunction with corresponding GAAP measures. A reconciliation between GAAP and non-GAAP financial results is provided in the financial tables section of this press release.

Conference Call and Webcast

Management will host a conference call and simultaneous webcast to discuss first quarter results and business and financial outlook today, July 29, 2014, at 2:00 p.m. Pacific Time / 5:00 p.m. Eastern Time.

DIAL-IN: (877) 280-4960
(857) 244-7317
PASSCODE: 83482949
WEBCAST: Investor Relations section of the Company's website at www.apm.com

A replay of the call will be available starting around 6:00 p.m. Pacific Time / 9:00 p.m. Eastern Time and can be accessed by dialing 888-286-8010 or 617-801-6888 and using the access code 99777506. The replay will be available through August 5, 2014.

About AppliedMicro

Applied Micro Circuits Corporation is a global leader in computing and connectivity solutions for next-generation cloud infrastructure and data centers. AppliedMicro delivers silicon solutions that dramatically lower total cost of ownership. Corporate headquarters are located in Sunnyvale, California. www.apm.com.

(C) Copyright 2014, Applied Micro Circuits Corporation. AppliedMicro, X-Gene, X-Weave, Server on a Chip, and Cloud Server are trademarks or registered trademarks of Applied Micro Circuits Corporation. All other product or service names are the property of their respective owners.

Forward-Looking Statements

This press release contains forward-looking statements that reflect the Company's current views and expectations with respect to future events and financial performance, including statements regarding the Company's strategic focus; product cycles; new product development, commercialization and customer acceptance; the development of the X-Gene™ ecosystem; the anticipated performance of the Company's base business; and future revenues, expenses and liquidity. These forward-looking statements are only predictions based on current information and expectations and are subject to certain risks and uncertainties, including, but not limited to, customer demand for the Company's products, successful and timely development of products, an evolving competitive landscape, rapid technological change, increased supplier lead times and other supply chain constraints, the businesses and budgeting decisions of the Company's major customers, reductions, rescheduling or cancellation of orders by the Company's customers, successful management of key service providers and recently acquired businesses, market acceptance of new products, legal and regulatory developments, and general economic conditions. More information about potential factors that could affect the Company's business and financial results is included in the "Risk Factors" set forth in the Company's Annual Report on Form 10-K for the year ended March 31, 2014, and the Company's other filings with the Securities and Exchange Commission. Actual results could differ materially, as a result of such factors, from those set forth in the forward-looking statements. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release. All forward-looking statements are qualified in their entirety by this cautionary statement, and the Company undertakes no obligation to revise or update any forward-looking statements to reflect events or circumstances after the issuance of this press release.

APPLIED MICRO CIRCUITS CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
(unaudited)
June 30, March 31,
ASSETS 2014 2014
Current assets:
Cash, cash equivalents and short-term investments $ 98,610 $ 106,583
Accounts receivable, net 22,932 25,178
Inventories 20,673 18,946
Other current assets 12,272 16,799
Total current assets 154,487 167,506
Property and equipment, net 20,303 20,746
Goodwill 11,425 11,425
Purchased intangibles, net 42 105
Other assets 6,935 7,754
Total assets $ 193,192 $ 207,536
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 17,233 $ 26,194
Other current liabilities 29,131 28,961
Total current liabilities 46,364 55,155
Non-current liabilities:
Veloce accrued liability 4,399 3,145
Stockholders' equity 142,429 149,236
Total liabilities and stockholders' equity $ 193,192 $ 207,536
APPLIED MICRO CIRCUITS CORPORATION
GAAP CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
(unaudited)
Three Months Ended
June 30, March 31, June 30,
2014 2014 2013
Net revenues $ 50,272 $ 51,771 $ 54,148
Cost of revenues 20,257 19,806 22,342
Gross profit 30,015 31,965 31,806
Operating expenses:
Research and development 33,205 25,653 34,506
Selling, general and administrative 9,058 9,325 9,526
Amortization of purchased intangible assets 62 62 130
Restructuring charges 1,211 4 93
Gain on sale of building -- (25,815) --
Gain on sale of TPack -- -- (19,699)
Total operating expenses 43,536 9,229 24,556
Operating (loss) income (13,521) 22,736 7,250
Interest and other income, net 315 418 3,795
(Loss) income before income taxes (13,206) 23,154 11,045
Income tax (benefit) expense (141) 38 188
Net (loss) income $ (13,065) $ 23,116 $ 10,857
Basic net (loss) income per share: $ (0.17) $ 0.31 $ 0.16
Shares used in calculating basic net (loss) income per share 77,916 75,629 69,360
Diluted net (loss) income per share: $ (0.17) $ 0.30 $ 0.15
Shares used in calculating diluted net (loss) income per share 77,916 77,193 70,234
APPLIED MICRO CIRCUITS CORPORATION
RECONCILIATION OF GAAP NET (LOSS) INCOME TO NON-GAAP NET INCOME
(in thousands, except per share data)
(unaudited)
Three Months Ended
June 30, March 31, June 30,
2014 2014 2013
GAAP net (loss) income $ (13,065) $ 23,116 $ 10,857
Adjustments:
Stock-based compensation charges 5,216 3,591 3,714
Amortization of purchased intangibles 62 62 296
Veloce acquisition consideration 7,140 -- 9,255
Restructuring charges 1,211 4 93
Gain on sale of building -- (25,815) --
Gain on sale of TPack -- -- (19,699)
Impairment of marketable securities (18) (16) (3,019)
Other and income tax adjustments (391) (212) (62)
Total GAAP to non-GAAP adjustments 13,220 (22,386) (9,422)
Non-GAAP net income $ 155 $ 730 $ 1,435
Diluted non-GAAP income per share $ 0.00 $ 0.01 $ 0.02
Shares used in calculating diluted non-GAAP income per share 79,082 77,193 70,234
Net (loss) income per share:
GAAP (loss) income per share $ (0.17) $ 0.30 $ 0.15
GAAP to non-GAAP adjustments 0.17 (0.29) (0.13)
Non-GAAP net income per share $ 0.00 $ 0.01 $ 0.02
Reconciliation of shares used in calculating non-GAAP income per share:
Shares used in calculating the basic (loss) income per share 77,916 75,629 69,360
Adjustment for dilutive securities 1,166 1,564 874
Non-GAAP shares used in calculating diluted income per share 79,082 77,193 70,234
APPLIED MICRO CIRCUITS CORPORATION
SCHEDULE OF SELECTED GAAP TO NON-GAAP ADJUSTMENTS
(in thousands)
(unaudited)
The following schedule reconciles selected line items from the GAAP basis statements of operations to the non-GAAP statements of operations:
Three Months Ended
June 30, March 31, June 30,
2014 2014 2013
GROSS PROFIT:
GAAP gross profit $ 30,015 $ 31,965 $ 31,806
Amortization of purchased intangibles -- -- 166
Stock-based compensation expense 47 102 98
Non-GAAP gross profit $ 30,062 $ 32,067 $ 32,070
OPERATING EXPENSES:
GAAP operating expenses $ 43,536 $ 9,229 $ 24,556
Stock-based compensation expense (5,169) (3,489) (3,616)
Amortization of purchased intangibles (62) (62) (130)
Veloce acquisition consideration (7,140) -- (9,255)
Gain on sale of building -- 25,815 --
Gain on sale of TPack -- -- 19,699
Restructuring charges (1,211) (4) (93)
Non-GAAP operating expenses $ 29,954 $ 31,489 $ 31,161
INTEREST AND OTHER INCOME, NET AND OTHER-THAN-TEMPORARY IMPAIRMENT:
GAAP interest and other income, net $ 315 $ 418 $ 3,795
Other-than-temporary investment impairment (18) (16) (3,019)
Non-GAAP interest and other income, net $ 297 $ 402 $ 776
INCOME TAX EXPENSE:
GAAP income tax (benefit) expense $ (141) $ 38 $ 188
Income tax adjustments 391 212 62
Non-GAAP income tax expense $ 250 $ 250 $ 250
RESEARCH AND DEVELOPMENT :
GAAP research and development $ 33,205 $ 25,653 $ 34,506
Stock-based compensation expense (3,271) (1,503) (1,817)
Veloce acquisition consideration (7,140) -- (9,255)
Non-GAAP research and development $ 22,794 $ 24,150 $ 23,434
SELLING, GENERAL AND ADMINISTRATIVE :
GAAP selling, general and administrative $ 9,058 $ 9,325 $ 9,526
Stock-based compensation expense (1,898) (1,986) (1,799)
Non-GAAP selling, general and administrative $ 7,160 $ 7,339 $ 7,727
APPLIED MICRO CIRCUITS CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
(unaudited)
Three Months Ended June 30,
2014 2013
Operating activities:
Net (loss) income $ (13,065) $ 10,857
Adjustments to reconcile net (loss) income to net cash used for operating activities:
Depreciation 2,174 2,624
Amortization of purchased intangibles 62 296
Stock-based compensation expense:
Stock options 417 602
Restricted stock units 4,799 3,112
Warrants -- --
Veloce acquisition consideration 7,140 9,255
Tax effect on other comprehensive income (194) --
Noncash restructuring charges -- 26
Net gain on sale of TPack -- (19,699)
Net loss (gain) on disposals of property, equipment and other assets 16 (3)
Changes in operating assets and liabilities:
Accounts receivable 2,246 (4,474)
Inventories (1,745) 185
Other assets 1,994 1,598
Accounts payable (6,163) (687)
Accrued payroll and other accrued liabilities 1,663 4,149
Veloce accrued liability (6,383) (24,982)
Deferred revenue 502 (671)
Net cash used for operating activities (6,537) (17,812)
Investing activities:
Proceeds from sales and maturities of short-term investments 682 14,185
Purchases of short-term investments (1,320) (2,361)
Proceeds from sale of TPack 3,353 29,498
Purchase of property, equipment and other assets (4,544) (279)
Net cash (used for) provided by investing activities (1,829) 41,043
Financing activities:
Proceeds from issuances of common stock 106 171
Funding of restricted stock units withheld for taxes (924) (2,382)
Other (88) (412)
Net cash used for financing activities (906) (2,623)
Net (decrease) increase in cash and cash equivalents (9,272) 20,608
Cash and cash equivalents at the beginning of the period 71,539 19,065
Cash and cash equivalents at the end of the period $ 62,267 $ 39,673

CONTACT: Investor Relations Contact: Traci Tsuchiguchi Phone: (408) 542-8353 E-Mail: ttsuchiguchi@apm.com Media Contact: Mike Major Phone: (408) 542-8831 E-mail: mmajor@apm.com

Source:Applied Micro Circuits Corporation