[November 03, 2015] |
|
Ixia Announces Financial Results for 2015 Third Quarter
Ixia (Nasdaq: XXIA) today reported its financial results for the
third quarter ended September 30, 2015.
Total revenue for the 2015 third quarter was $125.9 million, compared
with $114.0 million reported for the 2014 third quarter and $131.6
million reported for the 2015 second quarter.
"We delivered another solid quarter of year-over-year revenue and
earnings growth. Our revenue growth was driven by strong market momentum
across our product portfolio, particularly in the U.S. where revenue
grew 25% year-over-year to reach a new record. In addition to growing
our year-over-year bottom line results, we generated approximately $22
million in cash from operations as we continue to strive for operational
excellence and financial discipline," said Bethany Mayer, Ixia's
president and chief executive officer.
On a GAAP basis, the company recorded net income for the 2015 third
quarter of $4.0 million, or $0.05 per diluted share, compared with a net
loss of $7.3 million, or $0.09 per diluted share, for the 2014 third
quarter. Non-GAAP net income for the 2015 third quarter was $12.3
million, or $0.15 per diluted share, compared with non-GAAP net income
of $6.9 million, or $0.09 per diluted share, for the 2014 third quarter.
Additional non-GAAP information and a reconciliation of our non-GAAP
financial measures to the most directly comparable GAAP financial
measures for the 2015 and 2014 third quarters and year-to-date periods
may be found in the attached financial tables.
Ixia ended the 2015 third quarter with approximately $175 million in
cash, cash equivalents and investments, compared with $219 million at
June 30, 2015. Ixia's cash, cash equivalents and investments balance at
the end of the third quarter reflects approximately $22 million
generated in cash flow from operations during the third quarter offset
by approximately $65 million paid for the repurchase of a portion of the
company's outstanding convertible notes due December 15, 2015.
Conference Call and Webcast Information
Ixia will host a conference call today at 4:30 p.m. Eastern time for
analysts and investors to discuss the company's 2015 third quarter
results and its business outlook and guidance for the 2015 fourth
quarter. The call will be open to the public, and interested parties may
listen to the call by dialing (804) 681-3728. A live audio webcast of
the conference call will be accessible from the "Investors" section of
the company's website (www.ixiacom.com/investors).
Following the live webcast, an archived version will be available in the
"Investors" section of the Ixia website for at least 90 days. Certain
supplemental financial information will be posted promptly to the
website following the issuance of this press release and additional
supplemental financial information will be posted just prior to the
start of the conference call.
Non-GAAP Financial Measures
To supplement our consolidated financial results prepared in accordance
with Generally Accepted Accounting Principles ("GAAP"), we have included
certain non-GAAP financial measures in this press release and in the
attachments hereto. Specifically, we have provided non-GAAP financial
measures (i.e., non-GAAP net income and non-GAAP diluted earnings per
share) that exclude certain non-cash and/or non-recurring income and
expense items such as expenses relating to internal investigations and
any related remediation efforts, the restatement of our financial
statements for the first and second quarters of 2013 and for the six
months ended June 30, 2013, the pending securities class action and
shareholder derivative action against the company and certain of its
current and former officers and directors as well as an ongoing SEC
investigation, stock-based compensation expenses, acquisition and other
related costs, restructuring expenses, the amortization of
acquisition-related intangible assets, and the related income tax
effects of these items, as well as certain other non-cash income tax
impacts such as changes in the valuation allowance recorded against
certain deferred tax assets. The aforementioned items represent income
and expense items that may be difficult to estimate from period to
period and/or that we believe are not directly attributable to and/or
reflective of the underlying performance of our business operations. We
believe that, by excluding these items, our non-GAAP measures provide
supplemental information to both management and investors that is useful
in assessing our core operating performance, evaluating our ongoing
business operations, identifying and assessing financial and business
trends and comparing our results of operations on a consistent basis
from period to period. These non-GAAP financial measures are provided to
enhance the user's overall understanding of our financial performance.
These non-GAAP financial measures are also used by management to plan
and forecast future periods and to assist management in making operating
and strategic decisions. The presentation of this additional information
is not prepared in accordance with GAAP. The information may not
necessarily be comparable to that of other companies that may calculate
their non-GAAP financial measures differently and should be considered
as a supplement to, and not a substitute for or superior to, the
corresponding measures calculated in accordance with GAAP. Investors are
encouraged to review the reconciliations of GAAP to non-GAAP financial
measures, which are included below in the attached financial tables and
also posted on our website.
Safe Harbor under the Private Securities Litigation Reform Act of 1995
Certain statements made in this press release may be deemed to be
forward-looking statements including, without limitation, statements
regarding the company's strategy. In some cases, such forward-looking
statements can be identified by words such as "may," "will," "should,"
"could," "would," "expect," "plan," "anticipate," "believe," "estimate,"
"project," "predict," "potential" or the like. These statements reflect
our current views with respect to future events and are based on
assumptions and are subject to risks and uncertainties. These risks and
uncertainties, as well as other factors, may cause our future results,
performance or achievements to be materially different from those
expressed or implied by such forward-looking statements. Factors that
could cause the actual results to differ materially from those expressed
or implied in such forward-looking statements include, among others: our
success in developing, producing and introducing new products and in
keeping pace with the rapid technological changes that characterize our
market; our success in developing new sales channels and customers;
market acceptance of our products; competition; changes in the global
economy and in market conditions; consistency of orders from significant
customers; our success in leveraging our intellectual property
portfolio, expertise and market opportunities; our expectations
regarding the transition into Software Defined Networks (SDN), Network
Functions Virtualization (NFV) and virtualized networks; recent changes
in management; material weaknesses in our internal controls; the risk
that anticipated benefits and synergies of our 2012 acquisitions of Anue
and BreakingPoint and our 2013 acquisition of Net Optics will not be
realized; war, terrorism, political unrest, natural disasters,
cybersecurity attacks and other circumstances that could, among other
consequences, reduce the demand for our products, disrupt our supply
chain and/or impact the delivery of our products. The factors that may
cause future results to differ materially from our current expectations
also include, without limitation, the risks identified in our Annual
Report on Form 10-K for the year ended December 31, 2014 and in our
other filings with the Securities and Exchange Commission. We undertake
no obligation to update any forward-looking statements, whether as a
result of new information, future events or otherwise.
About Ixia
Ixia (Nasdaq: XXIA) provides application performance and security
resilience solutions to validate, secure and optimize businesses'
physical and virtual networks. Enterprises, service providers, network
equipment manufacturers and governments worldwide rely on Ixia's
solutions to deploy new technologies and achieve efficient, secure,
ongoing operation of their networks. Ixia's powerful and versatile
solutions, expert global support and professional services equip
organizations to exceed customer expectations and achieve better
business outcomes. Learn more at www.ixiacom.com.
Ixia and the Ixia logo are trademarks or registered trademarks of Ixia
in the U.S. and other countries.
|
IXIA
Consolidated Balance Sheets
(in thousands)
(unaudited)
|
|
|
|
|
|
|
|
September 30,
|
|
December 31,
|
|
|
2015
|
|
2014
|
Assets
|
|
|
|
|
Current assets:
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
75,751
|
|
|
$
|
46,394
|
|
Restricted cash
|
|
10,000
|
|
|
-
|
|
Marketable securities
|
|
49,467
|
|
|
79,760
|
|
Marketable securities, restricted
|
|
40,000
|
|
|
-
|
|
Accounts receivable, net of allowances of $862 and $1,011, as of
September 30, 2015 and December 31, 2014, respectively
|
|
105,663
|
|
|
99,528
|
|
Inventories
|
|
32,522
|
|
|
44,826
|
|
Prepaid expenses and other current assets
|
|
53,515
|
|
|
47,077
|
|
Total current assets
|
|
366,918
|
|
|
317,585
|
|
Property and equipment, net
|
|
35,965
|
|
|
37,648
|
|
Intangible assets, net
|
|
113,451
|
|
|
145,108
|
|
Goodwill
|
|
338,873
|
|
|
338,873
|
|
Other assets
|
|
28,206
|
|
|
30,697
|
|
Total assets
|
|
$
|
883,413
|
|
|
$
|
869,911
|
|
|
|
|
|
|
Liabilities and Shareholders' Equity
|
|
|
|
|
Current liabilities:
|
|
|
|
|
Accounts payable
|
|
$
|
12,183
|
|
|
$
|
16,902
|
|
Accrued expenses and other
|
|
58,765
|
|
|
45,271
|
|
Deferred revenues
|
|
103,760
|
|
|
100,170
|
|
Convertible senior notes
|
|
135,000
|
|
|
200,000
|
|
Term loan
|
|
3,000
|
|
|
-
|
|
Total current liabilities
|
|
312,708
|
|
|
362,343
|
|
Deferred revenues
|
|
21,930
|
|
|
18,046
|
|
Other liabilities
|
|
8,769
|
|
|
8,431
|
|
Term loan
|
|
36,000
|
|
|
-
|
|
Total liabilities
|
|
379,407
|
|
|
388,820
|
|
|
|
|
|
|
Shareholders' equity:
|
|
|
|
|
Common stock, without par value; 200,000 shares authorized at
September 30, 2015 and December 31, 2014; 80,084 and 78,575 shares
issued and outstanding as of September 30, 2015 and December 31,
2014, respectively
|
|
195,959
|
|
|
187,397
|
|
Additional paid-in capital
|
|
220,990
|
|
|
206,913
|
|
Retained earnings
|
|
87,774
|
|
|
87,574
|
|
Accumulated other comprehensive loss
|
|
(717
|
)
|
|
(793
|
)
|
Total shareholders' equity
|
|
504,006
|
|
|
481,091
|
|
Total liabilities and shareholders' equity
|
|
$
|
883,413
|
|
|
$
|
869,911
|
|
|
|
|
|
|
|
|
|
|
IXIA
Condensed Consolidated Statements of Operations
(in thousands, except per share data)
(unaudited)
|
|
|
|
|
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
Revenues:
|
|
|
|
|
|
|
|
|
Products
|
|
$
|
85,861
|
|
|
$
|
78,697
|
|
|
$
|
264,571
|
|
|
$
|
236,255
|
|
Services
|
|
40,026
|
|
|
35,300
|
|
|
113,888
|
|
|
100,997
|
|
Total revenues
|
|
125,887
|
|
|
113,997
|
|
|
378,459
|
|
|
337,252
|
|
Costs and operating expenses: (1)
|
|
|
|
|
|
|
|
|
Cost of revenues - products (2)
|
|
23,872
|
|
|
24,205
|
|
|
72,108
|
|
|
73,207
|
|
Cost of revenues - services
|
|
3,607
|
|
|
4,008
|
|
|
12,487
|
|
|
12,128
|
|
Research and development
|
|
28,538
|
|
|
27,612
|
|
|
83,923
|
|
|
87,679
|
|
Sales and marketing
|
|
37,920
|
|
|
35,642
|
|
|
113,880
|
|
|
114,355
|
|
General and administrative
|
|
18,486
|
|
|
14,724
|
|
|
54,274
|
|
|
49,296
|
|
Amortization of intangible assets
|
|
10,378
|
|
|
10,904
|
|
|
32,190
|
|
|
35,986
|
|
Acquisition and other related costs
|
|
(37
|
)
|
|
582
|
|
|
646
|
|
|
3,380
|
|
Restructuring
|
|
34
|
|
|
4,642
|
|
|
(527
|
)
|
|
8,687
|
|
Total costs and operating expenses
|
|
122,798
|
|
|
122,319
|
|
|
368,981
|
|
|
384,718
|
|
Income (loss) from operations
|
|
3,089
|
|
|
(8,322
|
)
|
|
9,478
|
|
|
(47,466
|
)
|
Interest income and other, net
|
|
(313
|
)
|
|
(99
|
)
|
|
(592
|
)
|
|
530
|
|
Interest expense
|
|
(2,270
|
)
|
|
(1,943
|
)
|
|
(6,852
|
)
|
|
(5,829
|
)
|
Income (loss) before income taxes
|
|
506
|
|
|
(10,364
|
)
|
|
2,034
|
|
|
(52,765
|
)
|
Income tax (benefit) expense
|
|
(3,502
|
)
|
|
(3,035
|
)
|
|
1,834
|
|
|
(10,887
|
)
|
Net income (loss)
|
|
$
|
4,008
|
|
|
$
|
(7,329
|
)
|
|
$
|
200
|
|
|
$
|
(41,878
|
)
|
Earnings (loss) per share:
|
|
|
|
|
|
|
|
|
Basic
|
|
$
|
0.05
|
|
|
$
|
(0.09
|
)
|
|
$
|
0.00
|
|
|
$
|
(0.54
|
)
|
Diluted
|
|
$
|
0.05
|
|
|
$
|
(0.09
|
)
|
|
$
|
0.00
|
|
|
$
|
(0.54
|
)
|
Weighted average number of common and common equivalent shares
outstanding:
|
|
|
|
|
|
|
|
|
Basic
|
|
79,895
|
|
|
77,920
|
|
|
79,336
|
|
|
77,380
|
|
Diluted
|
|
81,929
|
|
|
77,920
|
|
|
81,085
|
|
|
77,380
|
|
|
|
|
|
|
|
|
|
|
(1) Stock-based compensation included in:
|
|
|
|
|
|
|
|
|
Cost of revenues - products
|
|
$
|
62
|
|
|
$
|
81
|
|
|
$
|
233
|
|
|
$
|
217
|
|
Cost of revenues - services
|
|
24
|
|
|
31
|
|
|
89
|
|
|
82
|
|
Research and development
|
|
1,345
|
|
|
1,615
|
|
|
5,016
|
|
|
4,918
|
|
Sales and marketing
|
|
1,184
|
|
|
719
|
|
|
3,435
|
|
|
4,140
|
|
General and administrative
|
|
1,816
|
|
|
762
|
|
|
5,548
|
|
|
1,755
|
|
(2)
|
|
Cost of revenues - products excludes amortization of
intangible assets related to purchased technologies of $6.4
million and $19.3 million for the three and nine months ended
September 30, 2015, respectively, and $6.4 million and $22.5
million for the three and nine months ended September 30, 2014,
respectively, which are included in Amortization of intangible
assets.
|
|
|
|
IXIA
Non-GAAP Information and Reconciliation to Most Directly
Comparable GAAP Financial Measures
(in thousands, except per share data)
(unaudited)
|
|
|
|
|
|
Three Months Ended September 30,
|
|
|
2015
|
|
2014
|
GAAP net income (loss)
|
|
$
|
4,008
|
|
|
$
|
(7,329
|
)
|
Adjustments:
|
|
|
|
|
Stock-based compensation (a)
|
|
4,431
|
|
|
3,208
|
|
Amortization of intangible assets (b)
|
|
10,378
|
|
|
10,904
|
|
Acquisition and other related costs (c)
|
|
(37
|
)
|
|
582
|
|
Restructuring (d)
|
|
34
|
|
|
4,642
|
|
Investigations, shareholder litigation and related matters (e)
|
|
2,832
|
|
|
1,802
|
|
Income tax effect (f)
|
|
(9,387
|
)
|
|
(6,888
|
)
|
Non-GAAP net income
|
|
$
|
12,259
|
|
|
$
|
6,921
|
|
|
|
|
|
|
GAAP diluted income (loss) per share
|
|
$
|
0.05
|
|
|
$
|
(0.09
|
)
|
Adjustments:
|
|
|
|
|
Stock-based compensation (a)
|
|
0.05
|
|
|
0.04
|
|
Amortization of intangible assets (b)
|
|
0.13
|
|
|
0.14
|
|
Acquisition and other related costs (c)
|
|
-
|
|
|
0.01
|
|
Restructuring (d)
|
|
-
|
|
|
0.06
|
|
Investigations, shareholder litigation and related matters (e)
|
|
0.03
|
|
|
0.02
|
|
Income tax effect (f)
|
|
(0.11
|
)
|
|
(0.09
|
)
|
Convertible senior notes (g)
|
|
0.00
|
|
|
-
|
|
Non-GAAP diluted earnings per share
|
|
$
|
0.15
|
|
|
$
|
0.09
|
|
|
|
|
|
|
Shares used in computing GAAP diluted earnings per common share
|
|
81,929
|
|
|
77,920
|
|
Effect of reconciling item (g)(h)
|
|
7,168
|
|
|
922
|
|
Shares used in computing non-GAAP diluted earnings per common
share
|
|
89,097
|
|
|
78,842
|
|
|
|
|
|
|
|
|
(a)
|
|
This reconciling item represents stock-based compensation. As
stock-based compensation represents a non-cash charge that is not
directly attributable to the underlying performance of our business
operations, we believe that by excluding stock-based compensation,
we provide investors supplemental information that is useful in
comparing our operating results from period to period and in
evaluating our core operations and performance. While we expect to
continue to recognize stock-based compensation in the future,
management also excludes this expense when evaluating current
performance, forecasting future results, measuring core operating
results, and making operating and strategic decisions.
|
(b)
|
|
This reconciling item represents the amortization of intangible
assets related to the acquisitions of various businesses and
technologies. As amortization expense represents a non-cash charge
that is not directly attributable to the underlying performance of
our business operations, we believe that by excluding the
amortization of acquisition-related intangible assets, we provide
investors with supplemental information that is useful in evaluating
our ongoing operations and performance. While the amortization of
acquisition-related intangible assets is expected to continue in the
future, management also excludes this expense when evaluating
current performance, forecasting future results, measuring core
operating results, and making operating and strategic decisions.
|
(c)
|
|
This reconciling item represents costs associated with
acquisition-related activities. Acquisition and other related costs
consist primarily of transaction and integration-related costs such
as: professional fees for legal, accounting, tax, due diligence,
valuation and other related services; amortization of deferred
compensation; consulting fees; required regulatory costs; certain
employee, facility and infrastructure costs; and other related
expenses. We believe that by excluding acquisition and other related
costs, we provide investors with supplemental information that is
useful in comparing our ongoing operating results from period to
period and in evaluating our core operations and performance.
|
(d)
|
|
This reconciling item represents costs associated with our
restructuring plans. During the first quarter of 2014, we initiated
a plan to restructure certain of our operations following our
December 5, 2013 acquisition of Net Optics, Inc. During the third
quarter of 2014, we implemented a company-wide restructuring
initiative to restructure our operations to better align our
operating costs with our business opportunities. The restructuring
costs associated with our restructuring plans primarily relate to
employee termination benefits, lease exit costs and other related
costs. We believe that by excluding restructuring costs, we provide
investors with supplemental information that is useful in comparing
our operating results from period to period and in evaluating our
core operations and performance.
|
(e)
|
|
This reconciling item represents costs incurred related to (i)
internal investigations and any related remediation efforts, (ii)
the June 2014 restatement of our financial statements for the first
quarter of 2013 and for the three and six months ended June 30,
2013, (iii) the securities class action against the company and
certain of its current and former officers and directors as well as
a shareholder derivative action and (iv) an SEC investigation. These
costs consist primarily of legal and accounting fees, recruiting and
consulting expenses, severance and retention costs, and other
related expenses. We believe that by excluding these non-recurring
costs, we are providing our investors with supplemental information
that is useful in comparing our operating results from period to
period and in evaluating our core operations and performance.
|
(f)
|
|
This adjustment represents the income tax effects of the reconciling
items noted in footnotes (a), (b), (c), (d) and (e), as well as
certain other non-cash income tax impacts such as changes in the
valuation allowance relating to certain deferred tax assets.
|
(g)
|
|
This reconciling item for the non-GAAP diluted earnings per share
calculation for the three months ended September 30, 2015 includes
the impact of our convertible senior notes as these were
anti-dilutive for the equivalent GAAP earnings per share
calculations.
|
(h)
|
|
This adjustment represents the effects of stock-based compensation
on diluted common equivalent shares outstanding as well as any
adjustments required due to a change from a net loss to a net income
position.
|
|
|
|
IXIA
Non-GAAP Information and Reconciliation to Most Directly
Comparable GAAP Financial Measures
(in thousands, except per share data)
(unaudited)
|
|
|
|
|
|
Nine Months Ended September 30,
|
|
|
2015
|
|
2014
|
GAAP net income (loss)
|
|
$
|
200
|
|
|
$
|
(41,878
|
)
|
Adjustments:
|
|
|
|
|
Stock-based compensation (a)
|
|
14,321
|
|
|
11,112
|
|
Amortization of intangible assets (b)
|
|
32,190
|
|
|
35,986
|
|
Acquisition and other related costs (c)
|
|
646
|
|
|
3,380
|
|
Restructuring (d)
|
|
(527
|
)
|
|
8,687
|
|
Investigations, shareholder litigation and related matters (e)
|
|
7,114
|
|
|
11,889
|
|
Inventory adjustments (f)
|
|
-
|
|
|
1,393
|
|
Income tax effect (g)
|
|
(15,973
|
)
|
|
(18,044
|
)
|
Non-GAAP net income
|
|
$
|
37,971
|
|
|
$
|
12,525
|
|
|
|
|
|
|
GAAP diluted loss per share
|
|
$
|
0.00
|
|
|
$
|
(0.54
|
)
|
Adjustments:
|
|
|
|
|
Stock-based compensation (a)
|
|
0.18
|
|
|
0.14
|
|
Amortization of intangible assets (b)
|
|
0.40
|
|
|
0.47
|
|
Acquisition and other related costs (c)
|
|
0.01
|
|
|
0.04
|
|
Restructuring (d)
|
|
(0.01
|
)
|
|
0.11
|
|
Investigations, shareholder litigation and related matters (e)
|
|
0.09
|
|
|
0.15
|
|
Inventory adjustments (f)
|
|
-
|
|
|
0.02
|
|
Income tax effect (g)
|
|
(0.20
|
)
|
|
(0.23
|
)
|
Convertible senior notes (h)
|
|
(0.01
|
)
|
|
-
|
|
Non-GAAP diluted earnings per share
|
|
$
|
0.46
|
|
|
$
|
0.16
|
|
|
|
|
|
|
Shares used in computing GAAP diluted earnings per common share
|
|
81,085
|
|
|
77,380
|
|
Effect of reconciling item (h)(i)
|
|
9,307
|
|
|
1,187
|
|
Shares used in computing non-GAAP diluted earnings per common
share
|
|
90,392
|
|
|
78,567
|
|
|
|
|
|
|
|
|
(a)
|
|
This reconciling item represents stock-based compensation. As
stock-based compensation represents a non-cash charge that is not
directly attributable to the underlying performance of our business
operations, we believe that by excluding stock-based compensation,
we provide investors supplemental information that is useful in
comparing our operating results from period to period and in
evaluating our core operations and performance. While we expect to
continue to recognize stock-based compensation in the future,
management also excludes this expense when evaluating current
performance, forecasting future results, measuring core operating
results, and making operating and strategic decisions.
|
(b)
|
|
This reconciling item represents the amortization of intangible
assets related to the acquisitions of various businesses and
technologies. As amortization expense represents a non-cash charge
that is not directly attributable to the underlying performance of
our business operations, we believe that by excluding the
amortization of acquisition-related intangible assets, we provide
investors with supplemental information that is useful in evaluating
our ongoing operations and performance. While the amortization of
acquisition-related intangible assets is expected to continue in the
future, management also excludes this expense when evaluating
current performance, forecasting future results, measuring core
operating results, and making operating and strategic decisions.
|
(c)
|
|
This reconciling item represents costs associated with
acquisition-related activities. Acquisition and other related costs
consist primarily of transaction and integration-related costs such
as: professional fees for legal, accounting, tax, due diligence,
valuation and other related services; amortization of deferred
compensation; consulting fees; required regulatory costs; certain
employee, facility and infrastructure costs; and other related
expenses. We believe that by excluding acquisition and other related
costs, we provide investors with supplemental information that is
useful in comparing our ongoing operating results from period to
period and in evaluating our core operations and performance.
|
(d)
|
|
This reconciling item represents costs associated with our
restructuring plans. During the first quarter of 2014, we initiated
a plan to restructure certain of our operations following our
December 5, 2013 acquisition of Net Optics, Inc. During the third
quarter of 2014, we implemented a company-wide restructuring
initiative to restructure our operations to better align our
operating costs with our business opportunities. The restructuring
costs associated with our restructuring plans primarily relate to
employee termination benefits, lease exit costs and other related
costs. We believe that by excluding restructuring costs, we provide
investors with supplemental information that is useful in comparing
our operating results from period to period and in evaluating our
core operations and performance.
|
(e)
|
|
This reconciling item represents costs incurred related to (i)
internal investigations and any related remediation efforts, (ii)
the June 2014 restatement of our financial statements for the first
quarter of 2013 and for the three and six months ended June 30,
2013, (iii) the securities class action against the company and
certain of its current and former officers and directors as well as
a shareholder derivative action and (iv) an SEC investigation. These
costs consist primarily of legal and accounting fees, recruiting and
consulting expenses, severance and retention costs, and other
related expenses. We believe that by excluding these non-recurring
costs, we are providing our investors with supplemental information
that is useful in comparing our operating results from period to
period and in evaluating our core operations and performance.
|
(f)
|
|
This reconciling item represents the amortization of the purchase
price accounting adjustment related to the fair value of inventory
as a result of our acquisition of Net Optics, Inc. While we may have
additional amortization charges in the future resulting from
purchase price accounting adjustments, management excludes these
expenses when evaluating current performance, forecasting future
results, measuring core operating results, and making operating and
strategic decisions. We believe that by excluding these charges, we
provide investors with supplemental information that is useful in
comparing our operating results from period to period and in
evaluating our core operations and performance.
|
(g)
|
|
This adjustment represents the income tax effects of the reconciling
items noted in footnotes (a), (b), (c), (d), (e) and (f), as well as
certain other non-cash income tax impacts such as changes in the
valuation allowance relating to certain deferred tax assets.
|
(h)
|
|
This reconciling item for the non-GAAP diluted earnings per share
calculation for the nine months ended September 30, 2015 includes
the impact of our convertible senior notes as these were
anti-dilutive for the equivalent GAAP earnings per share
calculations.
|
(i)
|
|
This adjustment represents the effects of stock-based compensation
on diluted common equivalent shares outstanding as well as any
adjustments required due to a change from a net loss to a net income
position.
|
View source version on businesswire.com: http://www.businesswire.com/news/home/20151103006769/en/
[ Back To TMCnet.com's Homepage ]
|