[July 28, 2016] |
|
InvenSense Announces First Quarter Of Fiscal year 2017 Results
InvenSense
Inc. (NYSE:INVN), a leading provider of MEMS sensor platform
solutions, today announced results for its first quarter of fiscal year
2017, ended July 3, 2016.
Net revenue for the first quarter of fiscal 2017 was $60.6 million, down
24 percent from $79.5 million for the fourth quarter of fiscal 2016, and
down 43 percent from $106.3 million for the first quarter of fiscal 2016.
Gross margin determined in accordance with U.S. generally accepted
accounting principles (GAAP) was 41 percent for the first quarter of
fiscal 2017, consistent with the fourth quarter of fiscal 2016. GAAP
gross margin for the first quarter of fiscal 2017 included stock-based
compensation expense and related payroll taxes and amortization of
acquisition-related intangibles. Excluding these items, non-GAAP gross
margin was 46 percent for the first quarter of fiscal 2017, up from
non-GAAP gross margin of 45 percent for the fourth quarter of fiscal
2016.
GAAP net loss for the first quarter of fiscal 2017 was $20.2 million, or
$0.22 per share. By comparison, GAAP net loss was $22.9 million, or
$0.25 per share, for the fourth quarter of fiscal 2016. GAAP net loss
for the first quarter of fiscal 2017 included stock-based compensation
expense and related payroll taxes, accreting interest expense on
convertible notes, amortization of acquisition-related intangibles and
litigation-related expenses. Excluding these items and the income tax
effect of the excluded items as well as other discrete tax items,
non-GAAP net loss for the first quarter of fiscal 2017 was $4.9 million,
or $0.05 per share, compared with non-GAAP net income of $1.5 million,
or $0.02 per diluted share, for the fourth quarter of fiscal 2016.
The reconciliation between GAAP and non-GAAP financial results for all
referenced periods is provided in a table immediately following the
Unaudited Condensed Consolidated Statements of Operations below.
Management Qualitative Comments
"While worldwide consumer and mobile markets were somewhat soft in the
first fiscal quarter of 2017, the InvenSense team delivered on our
financial guidance, posting incrementally higher non-GAAP gross margins
in a competitive environment," said Behrooz Abdi, president and CEO.
"This was the result of improved manufacturing efficiency and product
mix, as well as our traction in both mobile and non-mobile markets. We
are successfully leveraging investments in our robust sensor platform to
integrate and enable high-value, consumer-driven use cases, such as
image stabilization, augmented and virtual reality, and inertial
navigation, for applications spanning a number of vertical markets.
These are creating exciting growth opportunities that we believe play
well into our focused strengths."
First Quarter of Fiscal Year 2017 Earnings Conference Call
A conference call will be held today at 1:30 p.m. Pacific Time to
discuss the quarter's results and management's current business outlook.
To listen to the conference call, please dial (877) 788-4691 ten minutes
prior to the start of the call, using the passcode 46679441.
International callers, please dial (530) 379-4724. A taped replay will
be made available approximately two hours after the conclusion of the
call and will remain available for seven days. To access the replay,
please dial (855) 859-2056 and enter passcode 46679441. International
callers please dial (404) 537-3406. The conference call will be
available via a live webcast on the investor relations section of
InvenSense's web site at www.invensense.com/ir.
An archived webcast replay will be available on the web site for two
months.
Note Regarding Use of Non-GAAP Financial Measures
As discussed above, in addition to the company's condensed consolidated
financial statements, which are presented according to GAAP, the company
provides certain non-GAAP financial information that excludes
stock-based compensation expense and related payroll taxes, accreting
interest expense on the company's 1.75% convertible senior notes,
amortization of acquisition-related intangible assets, contingent
consideration adjustments related to acquisition milestone payments,
patent-related settlement expense and litigation-related expenses,
including patent-related litigation expense in the three months ended
June 28, 2015. The company uses these non-GAAP measures in its own
financial and operational decision-making processes. Further, the
company believes that these non-GAAP measures offer an important
analytical tool to help investors understand the company's core
operating results and trends and facilitate comparability with the
operating results of other companies that provide similar non-GAAP
measures. These non-GAAP measures have certain limitations as analytical
tools and are not meant to be considered in isolation or as a substitute
for GAAP financial information. For example, stock-based compensation is
an important component of the company's compensation mix and will
continue to result in significant expenses in the company's GAAP results
for the foreseeable future, but it is not reflected in the company's
non-GAAP measures. Also, other companies, including other companies in
the company's industry, may calculate non-GAAP financial measures
differently, limiting their usefulness as comparative measures.
Forward-Looking Statements
Statements in this press release that are not historical are
"forward-looking statements" as the term is defined in the Private
Securities Litigation Reform Act of 1995. Forward-looking statements are
generally written in the future tense and/or preceded by words such as
"will," "expects," "anticipates," or other words that imply or predict a
future state. Forward-looking statements include any projection of
revenue, gross margin, expense, earnings, stockholder return or other
financial items discussed in this press release, as well as the expected
benefits of leveraging our investments in our sensor platform and our
beliefs regarding potential growth opportunities. Investors are
cautioned that all forward-looking statements in this press release
involve risks and uncertainty that can cause actual results to differ
materially from those currently anticipated due to a number of factors,
including without limitation, intense competition in our industry; our
dependence on a limited number of customers for a substantial portion of
our revenues; the receipt, reduction, cancellation or delay of
significant orders by our customers; advances and trends in new
technologies and industry standards; the continued adoption of motion
tracking and motion sensing as an interface in consumer electronics
products; decreases in average selling prices for our products; market
acceptance and changes in end-user demand for our customers' products;
our ability to continue to develop and introduce new and enhanced
products on a timely basis; and new product announcements and
introductions by our competitors, as well as the other risk factors
discussed in InvenSense's Annual Report on Form 10-K for the year ended
April 3, 2016 and other documents filed by us with the Securities and
Exchange Commission (SEC (News - Alert)) from time to time. Copies of InvenSense's SEC
filings are posted on the company's website and are available from the
company without charge. Forward-looking statements are made as of the
date of this release, and, except as required by law, the company does
not undertake an obligation to update its forward-looking statements to
reflect future events or circumstances.
About InvenSense
InvenSense, Inc. (NYSE: INVN) is the world's leading provider of MEMS
sensor platforms. InvenSense's vision of Sensing Everything™
targets the consumer electronics and industrial markets with integrated
Motion and Sound solutions. Our solutions combine MEMS (micro electrical
mechanical systems) sensors, such as accelerometers, gyroscopes,
compasses, and microphones with proprietary algorithms and firmware that
intelligently process, synthesize, and calibrate the output of sensors,
maximizing performance and accuracy. InvenSense's motion tracking, audio
and location platforms, and services can be found in Mobile, Wearables,
Smart Home, Industrial, Automotive, and IoT products. InvenSense is
headquartered in San Jose, California and has offices worldwide. For
more information, go to www.invensense.com
and http://www.coursaretail.com.
©2016 InvenSense, Inc. All rights reserved. InvenSense, Sensing
Everything, FireFly, SensorStudio, TrustedSensor, Coursa, UltraPrint,
MotionTracking, MotionProcessing, MotionProcessor, MotionFusion,
MotionApps, InvenSenseTV, DMP, AAR, and the InvenSense logo are
trademarks of InvenSense, Inc. Other company and product names may be
trademarks of the respective companies with which they are associated.
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INVENSENSE, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share amounts)
(Unaudited)
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
July 3, 2016
|
|
April 3, 2016
|
|
June 28, 2015
|
Net revenue
|
|
$
|
60,636
|
|
|
$
|
79,525
|
|
|
$
|
106,296
|
|
Costs of revenue
|
|
|
35,891
|
|
|
|
46,590
|
|
|
|
61,465
|
|
Gross profit
|
|
|
24,745
|
|
|
|
32,935
|
|
|
|
44,831
|
|
Operating expenses:
|
|
|
|
|
|
|
Research and development
|
|
|
26,541
|
|
|
|
26,432
|
|
|
|
20,255
|
|
Selling, general and administrative
|
|
|
13,862
|
|
|
|
16,860
|
|
|
|
15,824
|
|
Legal settlement
|
|
|
-
|
|
|
|
-
|
|
|
|
11,708
|
|
Total operating expenses
|
|
|
40,403
|
|
|
|
43,292
|
|
|
|
47,787
|
|
Loss from operations
|
|
|
(15,658
|
)
|
|
|
(10,357
|
)
|
|
|
(2,956
|
)
|
Interest (expense)
|
|
|
(2,881
|
)
|
|
|
(3,071
|
)
|
|
|
(2,724
|
)
|
Other income (expense), net
|
|
|
226
|
|
|
|
262
|
|
|
|
61
|
|
Loss before income taxes
|
|
|
(18,313
|
)
|
|
|
(13,166
|
)
|
|
|
(5,619
|
)
|
Income tax provision
|
|
|
1,872
|
|
|
|
9,780
|
|
|
|
228
|
|
Net loss
|
|
$
|
(20,185
|
)
|
|
$
|
(22,946
|
)
|
|
$
|
(5,847
|
)
|
|
|
|
|
|
|
|
Net loss per share:
|
|
|
|
|
|
|
Basic
|
|
$
|
(0.22
|
)
|
|
$
|
(0.25
|
)
|
|
$
|
(0.06
|
)
|
Diluted
|
|
$
|
(0.22
|
)
|
|
$
|
(0.25
|
)
|
|
$
|
(0.06
|
)
|
|
|
|
|
|
|
|
Weighted average shares outstanding used in computing net loss per
share:
|
|
|
|
|
|
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Basic
|
|
|
93,236
|
|
|
|
92,487
|
|
|
|
91,076
|
|
Diluted
|
|
|
93,236
|
|
|
|
92,487
|
|
|
|
91,076
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|
|
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INVENSENSE, INC.
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL RESULTS
(In thousands, except per share amounts)
(Unaudited)
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Three Months Ended
|
|
|
July 3, 2016
|
|
April 3, 2016
|
|
June 28, 2015
|
GAAP net loss
|
|
$
|
(20,185
|
)
|
|
$
|
(22,946
|
)
|
|
$
|
(5,847
|
)
|
Adjustments:
|
|
|
|
|
|
|
Stock based compensation expense and related payroll taxes
|
|
|
8,273
|
|
|
|
9,517
|
|
|
|
8,849
|
|
Convertible note accretion interest expense
|
|
|
2,113
|
|
|
|
2,237
|
|
|
|
1,958
|
|
Amortization of acquisition-related intangible assets
|
|
|
2,284
|
|
|
|
2,199
|
|
|
|
2,034
|
|
Legal settlement
|
|
|
-
|
|
|
|
-
|
|
|
|
11,708
|
|
Litigation-related expenses
|
|
|
60
|
|
|
|
120
|
|
|
|
1,110
|
|
Contingent consideration adjustment
|
|
|
-
|
|
|
|
-
|
|
|
|
(5,307
|
)
|
Income tax effect of pretax non-GAAP adjustments and other
discrete tax items
|
|
|
2,597
|
|
|
|
10,358
|
|
|
|
(1,923
|
)
|
Non-GAAP net income (loss)
|
|
$
|
(4,858
|
)
|
|
$
|
1,485
|
|
|
$
|
12,582
|
|
|
|
|
|
|
|
|
GAAP net loss per share of common stock
|
|
$
|
(0.22
|
)
|
|
$
|
(0.25
|
)
|
|
$
|
(0.06
|
)
|
Non-GAAP net income (loss) per share of common stock, diluted
|
|
$
|
(0.05
|
)
|
|
$
|
0.02
|
|
|
$
|
0.14
|
|
|
|
|
|
|
|
|
GAAP Gross profit
|
|
$
|
24,745
|
|
|
$
|
32,935
|
|
|
$
|
44,831
|
|
Adjustments:
|
|
|
|
|
|
|
Stock based compensation expense and related payroll taxes
|
|
|
619
|
|
|
|
669
|
|
|
|
609
|
|
Amortization of acquisition-related intangible assets
|
|
|
2,228
|
|
|
|
2,143
|
|
|
|
1,978
|
|
Non-GAAP Gross profit
|
|
$
|
27,592
|
|
|
$
|
35,747
|
|
|
$
|
47,418
|
|
|
|
|
|
|
|
|
GAAP Operating Expenses
|
|
$
|
40,403
|
|
|
$
|
43,292
|
|
|
$
|
47,787
|
|
Adjustments:
|
|
|
|
|
|
|
Stock based compensation expense and related payroll taxes
|
|
|
7,654
|
|
|
|
8,848
|
|
|
|
8,240
|
|
Amortization of acquisition-related intangible assets
|
|
|
56
|
|
|
|
56
|
|
|
|
56
|
|
Legal settlement accrual
|
|
|
-
|
|
|
|
-
|
|
|
|
11,708
|
|
Patent litigation legal expense, net
|
|
|
60
|
|
|
|
120
|
|
|
|
1,110
|
|
Contingent consideration adjustment
|
|
|
-
|
|
|
|
-
|
|
|
|
(5,307
|
)
|
Non-GAAP Operating Expenses
|
|
$
|
32,633
|
|
|
$
|
34,268
|
|
|
$
|
31,980
|
|
|
|
|
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INVENSENSE, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except par value)
(Unaudited)
|
|
|
|
|
|
July 3, 2016
|
|
April 3, 2016
|
Assets
|
|
|
|
Current assets:
|
|
|
|
Cash and cash equivalents
|
$
|
23,054
|
|
|
$
|
41,105
|
|
Short-term investments
|
|
247,274
|
|
|
|
243,755
|
|
Accounts receivable
|
|
37,945
|
|
|
|
41,447
|
|
Inventories
|
|
51,626
|
|
|
|
62,297
|
|
Prepaid expenses and other current assets
|
|
8,012
|
|
|
|
9,250
|
|
Total current assets
|
|
367,911
|
|
|
|
397,854
|
|
Property and equipment, net
|
|
35,134
|
|
|
|
36,271
|
|
Intangible assets, net
|
|
40,795
|
|
|
|
43,169
|
|
Goodwill
|
|
139,175
|
|
|
|
139,175
|
|
Other assets
|
|
5,750
|
|
|
|
5,992
|
|
Total assets
|
$
|
588,765
|
|
|
$
|
622,461
|
|
|
|
|
|
Liabilities and Stockholders' Equity
|
|
|
|
Current liabilities:
|
|
|
|
Accounts payable
|
$
|
13,282
|
|
|
$
|
35,200
|
|
Accrued liabilities
|
|
27,261
|
|
|
|
30,248
|
|
Total current liabilities
|
|
40,543
|
|
|
|
65,448
|
|
Long-term debt
|
|
153,151
|
|
|
|
151,038
|
|
Other long-term liabilities
|
|
26,755
|
|
|
|
27,230
|
|
Total liabilities
|
|
220,449
|
|
|
|
243,716
|
|
|
|
|
|
Stockholders' equity:
|
|
|
|
Preferred stock:
|
|
|
|
Preferred stock, $0.001 par value - 20,000 shares authorized, no
shares issued and outstanding at July 3, 2016 and April 3, 2016
|
|
-
|
|
|
|
-
|
|
Common stock:
|
|
|
|
Common stock, $0.001 par value - 750,000 shares authorized, 93,641
shares issued and outstanding at July 3, 2016, 93,010 shares
issued and outstanding at April 3, 2016
|
|
312,912
|
|
|
|
303,153
|
|
Accumulated other comprehensive (loss)
|
|
(29
|
)
|
|
|
(26
|
)
|
Retained earnings
|
|
55,433
|
|
|
|
75,618
|
|
Total stockholders' equity
|
|
368,316
|
|
|
|
378,745
|
|
Total liabilities and stockholders' equity
|
$
|
588,765
|
|
|
$
|
622,461
|
|
|
|
|
INVENSENSE, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
|
|
|
|
|
|
Three Months Ended
|
|
|
July 3, 2016
|
|
April 3, 2016
|
|
June 28, 2015
|
Cash flows from operating activities:
|
|
|
|
|
|
|
Net loss
|
|
$
|
(20,185
|
)
|
|
$
|
(22,946
|
)
|
|
$
|
(5,847
|
)
|
Adjustments to reconcile net income to net cash provided by (used
in) operating activities:
|
|
|
|
|
|
|
Depreciation
|
|
|
3,310
|
|
|
|
3,221
|
|
|
|
3,050
|
|
Amortization of intangible assets
|
|
|
2,375
|
|
|
|
2,290
|
|
|
|
2,142
|
|
Non cash interest expense
|
|
|
2,113
|
|
|
|
2,237
|
|
|
|
1,958
|
|
Loss on other investments
|
|
|
325
|
|
|
|
525
|
|
|
|
-
|
|
Stock-based compensation expense
|
|
|
8,176
|
|
|
|
9,003
|
|
|
|
8,635
|
|
Contingent consideration adjustment
|
|
|
-
|
|
|
|
-
|
|
|
|
(5,307
|
)
|
Deferred income tax assets
|
|
|
80
|
|
|
|
8,809
|
|
|
|
(1,824
|
)
|
Tax effect of employee benefit plans
|
|
|
-
|
|
|
|
876
|
|
|
|
(301
|
)
|
Excess tax benefit from stock-based compensation
|
|
|
-
|
|
|
|
(876
|
)
|
|
|
Changes in operating assets and liabilities:
|
|
|
|
|
|
|
Accounts receivable
|
|
|
3,502
|
|
|
|
1,082
|
|
|
|
(5,865
|
)
|
Inventories
|
|
|
10,670
|
|
|
|
(631
|
)
|
|
|
10,614
|
|
Prepaid expenses and other current assets
|
|
|
833
|
|
|
|
(610
|
)
|
|
|
959
|
|
Other assets
|
|
|
207
|
|
|
|
(498
|
)
|
|
|
(118
|
)
|
Accounts payable
|
|
|
(22,282
|
)
|
|
|
(9,118
|
)
|
|
|
4,191
|
|
Accrued liabilities
|
|
|
(3,379
|
)
|
|
|
2,776
|
|
|
|
12,975
|
|
Net cash provided by (used in) operating activities
|
|
|
(14,255
|
)
|
|
|
(3,860
|
)
|
|
|
25,262
|
|
|
|
|
|
|
|
|
Cash flows from investing activities:
|
|
|
|
|
|
|
Purchase of property and equipment
|
|
|
(1,892
|
)
|
|
|
(1,538
|
)
|
|
|
(2,342
|
)
|
Sale and maturities of available-for-sale investments
|
|
|
56,448
|
|
|
|
55,064
|
|
|
|
15,365
|
|
Purchase of available-for-sale investments
|
|
|
(60,055
|
)
|
|
|
(45,249
|
)
|
|
|
(54,427
|
)
|
Other non-marketable investments
|
|
|
-
|
|
|
|
(850
|
)
|
|
|
-
|
|
Acquisitions, net of cash acquired
|
|
|
-
|
|
|
|
(6,700
|
)
|
|
|
-
|
|
Net cash provided by (used in) investing activities
|
|
|
(5,499
|
)
|
|
|
727
|
|
|
|
(41,404
|
)
|
|
|
|
|
|
|
|
Cash flows from financing activities:
|
|
|
|
|
|
|
Proceeds from exercise of common stock
|
|
|
1,703
|
|
|
|
865
|
|
|
|
3,364
|
|
Payments of acquisition holdback
|
|
|
-
|
|
|
|
(1,380
|
)
|
|
|
-
|
|
Excess tax benefit from stock-based compensation
|
|
|
-
|
|
|
|
876
|
|
|
|
-
|
|
Net cash provided by financing activities
|
|
|
1,703
|
|
|
|
361
|
|
|
|
3,364
|
|
|
|
|
|
|
|
|
Net decrease in cash and cash equivalents
|
|
|
(18,051
|
)
|
|
|
(2,772
|
)
|
|
|
(12,778
|
)
|
Cash and cash equivalents:
|
|
|
|
|
|
|
Beginning of period
|
|
|
41,105
|
|
|
|
43,877
|
|
|
|
85,637
|
|
End of period
|
|
$
|
23,054
|
|
|
$
|
41,105
|
|
|
$
|
72,859
|
|
View source version on businesswire.com: http://www.businesswire.com/news/home/20160728006575/en/
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