Acacia Communications Announces Preliminary Fourth Quarter and Full Year 2020 Results
MAYNARD, Mass., Jan. 11, 2021 (GLOBE NEWSWIRE) -- Acacia Communications, Inc. (NASDAQ: ACIA) ("Acacia Communications" or "Company"), a leading provider of high-speed coherent optical interconnect products, today announced certain preliminary unaudited financial results for its fourth fiscal quarter and fiscal year ended December 31, 2020.
Preliminary Results for the Fourth Quarter of 2020
Preliminary Results for the Full Year 2020
These preliminary unaudited financial results are based on preliminary unaudited information and management's estimates, and are inherently uncertain and subject to revision in connection with the Company's financial closing procedures and finalization of the Company’s financial statements for its fourth fiscal quarter and fiscal year ended December 31, 2020, and any adjustments identified by the Company’s auditors in the course of their review and audit, as applicable, of such financial statements. Actual results and other disclosures for the fourth fiscal quarter and fiscal year ended December 31, 2020 may differ materially from these preliminary unaudited financial results. These preliminary unaudited financial results were not prepared with a view toward complying with the guidelines established by the American Institute of Certified Public Accountants with respect to projected financial information, but, in the view of the Company’s management, were prepared on a reasonable basis, reflect management’s best currently available estimates and judgments, and present, to the best of management’s knowledge and belief, the Company’s expectations for the fourth fiscal quarter and fiscal year ended December 31, 2020. Neither the Company’s independent auditors, nor any other independent accountants, have compiled, examined, or performed any procedures with respect to these unaudited preliminary financial results, nor have they expressed any opinion or any other form of assurance on such results, and assume no responsibility for, and disclaim any association with, these preliminary unaudited financial results. These preliminary unaudited financial results should not be viewed as a substitute for full financial statements prepared in accordance with generally accepted accounting principles (“GAAP”).
*Non-GAAP net income and non-GAAP diluted earnings per share (EPS) are non-GAAP financial measures that are not prepared in accordance with GAAP. Please refer below to Use of Non-GAAP Financial Information for descriptions of these non-GAAP financial measures and to the Reconciliation of GAAP Measures to Non-GAAP Measures, attached as Schedule A, for reconciliations of the most directly comparable GAAP financial measures to these non-GAAP financial measures.
Use of Non-GAAP Financial Information
Schedule A of this press release provides reconciliations of Acacia Communications’ most comparable preliminary GAAP financial measures to preliminary non-GAAP net income and preliminary non-GAAP diluted EPS for its fourth fiscal quarter and fiscal year ended December 31, 2020.
Acacia Communications believes that providing these non-GAAP financial measures to investors, in addition to providing the most directly comparable GAAP measures, provides investors the benefit of viewing the Company’s performance using the same financial metrics that its management team uses in making many key decisions and evaluating how its results of operations may look in the future. Acacia Communications’ management does not believe that items not involving cash expenditures, such as non-cash compensation related to equity awards, are part of its critical decision making process. Also, Acacia Communications' management does not believe that items such as warranty and other charges arising from a manufacturing process quality issue, certain litigation related costs and settlement reserves outside the normal course of the Company’s business, acquisition related costs or certain adjustments to its valuation allowance against deferred tax assets are reflective of the Company’s underlying operating performance. Further, in connection with the seven-year denial of export privileges imposed on April 15, 2018 by the U.S. Department of Commerce against ZTE, which was subsequently lifted on July 13, 2018, the Company recorded inventory write-offs. Acacia Communications’ management does not believe these write-offs, and any subsequent adjustments as a result of management’s ongoing evaluation of the ZTE inventory, are reflective of the Company’s underlying operating performance. Therefore, Acacia Communications excludes those items, as applicable, from non-GAAP net income and non-GAAP diluted EPS.
Acacia Communications’ non-GAAP financial measures reflect adjustments based on the metrics described below, as well as the related income tax effects. The income tax effect of these non-GAAP adjustments is determined by recalculating income tax expense excluding these adjustments.
Non-GAAP net income and non-GAAP diluted EPS. Acacia Communications defines non-GAAP net income as net income as reported on the Company’s consolidated statements of operations, excluding the impact of stock-based compensation which is a non-cash charge, as well as warranty and other charges arising from a manufacturing process quality issue, ZTE-related inventory write-offs and subsequent adjustments, certain litigation related costs and settlement reserves, acquisition related costs, the tax effects of those excluded items and certain valuation allowance adjustments against deferred tax assets.
Acacia Communications has presented non-GAAP net income and non-GAAP diluted EPS because the Company believes that the exclusion of the items discussed above facilitates comparisons of its results of operations to other companies in its industry and more accurately reflects the underlying performance of the Company's continuing business operations.
Acacia Communications uses these non-GAAP financial measures to evaluate its operating performance and trends, and make planning decisions. Acacia Communications believes that each of these non-GAAP financial measures helps identify underlying trends in its business that could otherwise be masked by the effect of the items that the Company excludes. Accordingly, Acacia Communications believes that these financial measures provide useful information to investors and others in understanding and evaluating its operating results, enhancing the overall understanding of the Company’s past performance and future prospects, and allowing for greater transparency with respect to key financial metrics used by its management in its financial and operational decision-making.
Acacia Communications’ non-GAAP financial measures are not prepared in accordance with GAAP, and should not be considered in isolation of, or as an alternative to, measures prepared in accordance with GAAP. There are a number of limitations related to the use of these non-GAAP financial measures rather than net income or diluted EPS, which are the most directly comparable GAAP measures. Some of these limitations are:
Because of these limitations, non-GAAP financial measures should be considered along with other operating and financial performance measures presented in accordance with GAAP.
Acacia Communications’ use of non-GAAP financial measures, and the underlying methodology when excluding certain items, is not necessarily an indication of the results of operations that may be expected in the future, or that Acacia Communications will not, in fact, record such items in future periods.
Investors should consider Acacia Communications’ non-GAAP financial measures in conjunction with the corresponding GAAP financial measures.
About Acacia Communications
Forward Looking Statements
SOURCE Acacia Communications, Inc.
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