|
|
Atheros Communications Announces Record Second Quarter 2004 Financial Results Gross Margins Increase to 49.9 Percent SUNNYVALE, Calif., July 21, 2004— Atheros Communications, Inc. (NASDAQ: ATHR), a leading developer of advanced wireless LAN chipsets, today announced record financial results for the second quarter of fiscal 2004, ended June 30, 2004. Revenue in the second quarter of fiscal 2004 was a record $46.6 million, compared with $43.1 million in the first quarter of fiscal 2004, an increase of eight percent. Gross margins in the second quarter of fiscal 2004 were 49.9 percent, 570 basis points higher than the 44.2 percent gross margins reported in the prior quarter. In accordance with U.S. generally accepted accounting principles (GAAP), the company's net income in the second quarter of fiscal 2004 was a record $5.5 million, or earnings of $0.10 per diluted share on 53.8 million average shares outstanding. This compares with a net income of $2.4 million, or $0.05 per diluted share on 48.2 million average shares outstanding in the first quarter of fiscal 2004. Total cash and short-term investments were $155.9 million at June 30, 2004, compared with $158.4 million at March 31, 2004, a decrease of $2.5 million resulting from cash used for working capital needs. Atheros reports net income (loss) and basic and diluted net income (loss) per share in accordance with GAAP and additionally on a non-GAAP basis. Non-GAAP net income (loss), where applicable, excludes the effect of the amortization of stock-based compensation. In the second quarter of 2004, non- GAAP net income was $6.5 million, or $0.12 per diluted share, compared with non-GAAP net income of $3.5 million, or $0.07 per diluted share, in the first quarter of fiscal 2004. Average shares used in computing non-GAAP net income per share for the second quarter of fiscal 2004 increased to 53.8 million, compared with 48.2 million for the first quarter of fiscal 2004. Six Months Ended June 30, 2004 Revenues for the six months ended June 30, 2004 were $89.7 million, with gross margins of 47.1 percent. GAAP net income for the six-month period was $7.9 million, or $0.15 per share. Non-GAAP net income for that period was $10.0 million, or 11 percent of revenues and $0.20 per share on 51.0 million average shares outstanding. "We increased our leadership position in key areas of the wireless networking industry in the second quarter, resulting in record financial results," said Craig Barratt, president and CEO of Atheros. "We are especially pleased to be shipping production quantities of the world's first single-chip 802.11g wireless LAN solution, integrating the MAC, baseband and 2.4 GHz radio. Also in the second quarter we began volume shipments of a second version of our single-chip solution, incorporating Super G(TM) and our unique adaptive radio features. Both of our single-chip solutions include our Atheros eXtended Range™ (XR) technology, which dramatically increases the range of wireless LAN devices by up to three times that of basic 802.11a and .11g solutions," Barratt said. Fujitsu, NEC and Sony all introduced new laptops using Atheros Super G® and Super AG® technology in the second quarter. On the enterprise side, Atheros announced products with Foundry Networks, Trapeze Networks, Vivato and Colubris Networks. Atheros Super G and Super AG® technologies continue to gain widespread acceptance. Seventeen leading Japanese WLAN equipment vendors and PC manufacturers are now shipping products using Atheros' Super G or Super AG® technologies, and many of them are displaying the Atheros Super AG®/G logo on their PCs and wireless LAN equipment, as well as on product boxes, data sheets, brochures and websites. "In consumer electronics, we just announced our first chipset targeted for video and multimedia applications. This chipset includes smart antenna and quality-of-service (QoS) features, which deliver high-quality video throughout the home. We also announced joint reference designs with Syabas and Sigma Designs, and a collaboration with NEC Electronics on a new AV module including this chipset, which is being demonstrated for the first time this week at the Wireless Japan 2004 Show in Tokyo," Barratt said. Conference Call Atheros will broadcast its conference call discussion of second quarter fiscal 2004 financial results today, Wednesday, July 21, 2004 at 2:00 p.m. pacific daylight time (5:00 p.m. eastern daylight time). To listen to the call, please dial 630-395-0049 approximately 10 minutes prior to the start time. The pass code is: Atheros. A taped replay will be available approximately one hour after the conclusion of the call and will remain available for one week. To access the replay, dial 203-369-1197. The Atheros financial results conference call will be available via a live webcast on the investor relations section of the Atheros web site at www.atheros.com. Please access the web site approximately 15 minutes prior to the start of the call to download and install any necessary audio software. An archived webcast replay of the call will be available at the web site for one year. Atheros Communications, Inc. Atheros Communications is a leading developer of semiconductor system solutions for wireless communications products. Atheros combines its wireless systems expertise with high-performance radio frequency, mixed signal and digital semiconductor design skills to provide highly integrated chipsets that are manufacturable on low-cost, standard complementary metal-oxide semiconductor (CMOS) processes. Atheros technology is being used by a broad base of leading customers, including personal computer and networking equipment manufacturers. For more information, visit www.atheros.com or send email to info@atheros.com. ### Atheros, the Atheros logo, eXtended Range, Super G and Super AG® are trademarks of Atheros Communications, Inc. Forward Looking Statement: Except for the historical information contained herein, the matters set forth in this press release, including statements as to the continued acceptance and adoption of, and the expected benefits and capabilities of, Atheros' products and technology, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as "expected," "believes" "anticipates," "plans," "expects," "will" and similar expressions are intended to identify forward-looking statements. These forward-looking statements are subject to risks and uncertainties that could cause the actual results of Atheros to differ materially, including, among others, the ability of our customers to provide competitive solutions based on our products, development and manufacturing difficulties, the impact of competitive products and alternative technological advances, and risks detailed in Atheros' Quarterly Report on Form 10-Q for the quarter ended March 31, 2004, as filed with the SEC, and in other reports filed by Atheros with the SEC from time to time. These forward-looking statements speak only as of the date hereof. Atheros does not undertake any obligation to update forward-looking statements. ATHEROS COMMUNICATIONS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
(In thousands, except per share data)
Three Months Ended Six Months Ended
June 30, June 30,
2004 2003 2004 2003
Net revenue $46,593 $15,125 $89,692 $24,531
Cost of goods sold 23,347 8,739 47,415 14,218
Gross profit 23,246 6,386 42,277 10,313
Operating expenses:
Research and
development 10,496 6,671 20,221 12,943
Sales and
marketing 4,159 2,566 7,660 4,660
General and
administrative 2,063 1,217 4,293 2,151
Stock-based
compensation 1,024 820 2,140 882
Total operating
expenses 17,742 11,274 34,314 20,636
Income (loss)
from operations 5,504 (4,888) 7,963 (10,323)
Interest income
(expense), net 470 (15) 623 13
Income taxes (452) -- (685) --
Net income (loss) $5,522 $(4,903) $7,901 $ (10,310)
Basic earnings
(loss) per share $0.12 $(0.41) $0.20 $(0.87)
Diluted earnings
(loss) per share $0.10 $(0.41) $0.15 $(0.87)
Shares used in
computing basic
and pro forma basic
earnings
(loss) per share 46,499 12,037 38,637 11,836
Shares used
in computing
diluted and pro
forma diluted
earnings (loss)
per share 53,799 12,037 51,015 11,836
Pro forma net
income (loss)(*) $6,546 $(4,083) $10,041 $(9,428)
Pro forma basic
earnings (loss)
per share (*) $0.14 $(0.34) $0.26 $(0.80)
Pro forma diluted
earnings (loss)
per share (*) $0.12 $(0.34) $0.20 $(0.80)
Reconciliation of GAAP Net Income (Loss) to
Pro Forma Net Income (Loss)
Three Months Ended Six Months Ended
June 30, June 30,
2004 2003 2004 2003
GAAP net
income (loss) $5,522 $(4,903) $7,901 $(10,310)
Stock-based
compensation 1,024 820 2,140 882
Pro forma net
income (loss) $6,546 $(4,083) $10,041 $(9,428)
(*) To supplement our consolidated financial statements presented in
accordance with GAAP, we have shown above a non-GAAP measure of net
income (loss), which is adjusted from results based on GAAP to
exclude stock-based compensation. This non-GAAP measure is provided
to enhance the user's overall understanding of our historical
financial performance. Specifically, we believe the non-GAAP results
provide useful information to both management and investors by
excluding stock-based compensation expenses.
ATHEROS COMMUNICATIONS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)
(In thousands)
June 30, December 31,
2004 2003
ASSETS
Current assets:
Cash, cash equivalents and
marketable securities $155,913 $29,039
Accounts receivable, net 19,477 9,855
Inventories 16,134 10,929
Prepaid expenses and other current assets 3,270 1,110
Total current assets 194,794 50,933
Property and equipment, net 2,668 2,346
Other assets 1,359 2,607
$198,821 $55,886
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities $31,249 $31,769
Long-term liabilities 1,128 1,831
Stockholders' equity 166,444 22,286
$198,821 $55,886
For
analyst inquires contact: Jack Lazar,
Chief Financial Officer of Atheros Communications, For press inquiries contact: Cheryl Patstone, 408-773-5344, cheryl@atheros.com or Greg Wood, A&R Partners, 650-762-2838, gwood@arpartners.com. "Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995: Statements in this press release regarding Atheros Communications's business which are not historical facts are "forward-looking statements" that involve risks and uncertainties. For a discussion of such risks and uncertainties, which could cause actual results to differ from those contained in the forward-looking statements, see "Risk Factors" in the Company's Annual Report or Form 10-K for the most recently ended fiscal year. |
 | Site Map |
