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Table of Contents

 
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 

 
FORM 10-Q
 
x
 
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 
For the quarterly period ended July 31, 2002
 
OR
 
¨
 
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 
For the transition period from                                    to                                   
 
(Commission File Number) 000-27071
 

 
AGILE SOFTWARE CORPORATION
(Exact name of registrant as specified in its charter)
 
 
Delaware
 
77-0397905
(State of incorporation)
 
(IRS Employer
Identification Number)
 
One Almaden Boulevard, San Jose, Ca 95113-2253
(Address of principal executive offices, including ZIP code)
 
(408) 975-3900
(Registrant’s telephone number, including area code)
 
None
(Former name, former address and former fiscal year, if changed since last report)
 

 
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes  x  No  ¨
 
The number of shares outstanding of the Registrant’s Common Stock as of July 31, 2002 was 48,469,816.
 

 


Table of Contents
 
AGILE SOFTWARE CORPORATION
 
I NDEX
 
          
Page No.

    Part I.
 
Financial Information
      
    Item 1.
 
Financial Statements (unaudited)
      
        
3
        
4
        
5
        
6
    Item 2.
      
12
    Item 3.
      
34
    Part II.
 
Other Information
      
    Item 1.
      
35
    Item 2.
      
35
    Item 3.
      
35
    Item 4.
      
35
    Item 5.
      
36
    Item 6.
      
36
    
37
    
38

2


Table of Contents
 
PART 1—FINANCIAL INFORMATION
 
Item 1.    Financial Statements
 
AGILE SOFTWARE CORPORATION
 
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
(unaudited)
 
    
July 31,
2002

    
April 30,
2002(1)

 
ASSETS
                 
Current assets:
                 
Cash and cash equivalents
  
$
121,782
 
  
$
123,374
 
Short-term investments
  
 
151,952
 
  
 
162,175
 
Accounts receivable, net of allowance for doubtful accounts of $997 and $1,112 as of July 31, 2002 and April 30, 2002, respectively
  
 
7,693
 
  
 
6,538
 
Other current assets
  
 
6,792
 
  
 
8,052
 
    


  


Total current assets
  
 
288,219
 
  
 
300,139
 
Property and equipment, net
  
 
11,105
 
  
 
10,887
 
Other assets
  
 
5,825
 
  
 
8,038
 
    


  


    
$
305,149
 
  
$
319,064
 
    


  


LIABILITIES AND STOCKHOLDERS’ EQUITY
                 
Current liabilities:
                 
Accounts payable
  
$
3,897
 
  
$
5,113
 
Accrued expenses and other liabilities
  
 
13,249
 
  
 
14,120
 
Deferred revenue
  
 
12,836
 
  
 
13,200
 
    


  


Total current liabilities
  
 
29,982
 
  
 
32,433
 
Stockholders’ equity:
                 
Common Stock
  
 
48
 
  
 
48
 
Additional paid-in capital
  
 
512,030
 
  
 
512,349
 
Notes receivable from stockholders
  
 
(242
)
  
 
(249
)
Unearned stock compensation
  
 
(3,060
)
  
 
(4,004
)
Accumulated other comprehensive income
  
 
344
 
  
 
92
 
Accumulated deficit
  
 
(233,953
)
  
 
(221,605
)
    


  


Total stockholders’ equity
  
 
275,167
 
  
 
286,631
 
    


  


    
$
305,149
 
  
$
319,064
 
    


  



(1)
 
The April 30, 2002 consolidated balance sheet information has been derived from the audited financial statements at that date.
 
See accompanying notes to these condensed consolidated financial statements.

3


Table of Contents
AGILE SOFTWARE CORPORATION
 
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
(unaudited)
 
    
Three Months Ended
July 31,

 
    
2002

    
2001

 
Revenues:
                 
License
  
$
6,855
 
  
$
16,007
 
Professional services and maintenance
  
 
9,169
 
  
 
7,318
 
    


  


Total revenues
  
 
16,024
 
  
 
23,325
 
    


  


Cost of revenues:
                 
License
  
 
651
 
  
 
962
 
Professional services and maintenance
  
 
4,662
 
  
 
3,705
 
Stock compensation
  
 
24
 
  
 
27
 
    


  


Total cost of revenues
  
 
5,337
 
  
 
4,694
 
    


  


Gross profit
  
 
10,687
 
  
 
18,631
 
    


  


Operating expenses:
                 
Sales and marketing:
                 
Other sales and marketing
  
 
11,673
 
  
 
15,068
 
Stock compensation
  
 
455
 
  
 
435
 
Research and development:
                 
Other research and development
  
 
8,065
 
  
 
8,348
 
Stock compensation
  
 
105
 
  
 
138
 
General and administrative:
                 
Other general and administrative
  
 
1,637
 
  
 
2,200
 
Stock compensation (recovery)
  
 
(41
)
  
 
(186
)
Amortization of goodwill and other intangible assets
  
 
—    
 
  
 
189
 
Merger related benefit
  
 
—    
 
  
 
(835
)
    


  


Total operating expenses
  
 
21,894
 
  
 
25,357
 
    


  


Loss from operations
  
 
(11,207
)
  
 
(6,726
)
Interest and other income, net
  
 
1,515
 
  
 
3,259
 
Impairment of equity investments
  
 
(2,560
)
  
 
(1,446
)
    


  


Loss before income taxes
  
 
(12,252
)
  
 
(4,913
)
Provision for income taxes
  
 
96
 
  
 
107
 
    


  


Net loss
  
$
(12,348
)
  
$
(5,020
)
    


  


Net loss per share:
                 
Basic and diluted
  
$
(0.26
)
  
$
(0.11
)
    


  


Weighted average shares
  
 
48,176
 
  
 
46,790
 
    


  


 
See accompanying notes to these condensed consolidated financial statements.

4


Table of Contents
 
AGILE SOFTWARE CORPORATION
 
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
(unaudited)
 
    
Three Months Ended
July 31,

 
    
2002

    
2001

 
Cash flows from operating activities:
                 
Net loss
  
$
(12,348
)
  
$
(5,020
)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
                 
Provision for doubtful accounts
  
 
—  
 
  
 
349
 
Depreciation and amortization
  
 
2,161
 
  
 
2,322
 
Amortization of stock compensation
  
 
543
 
  
 
414
 
Impairment of equity investments
  
 
2,560
 
  
 
1,446
 
Changes in operating assets and liabilities:
                 
Accounts receivable, net
  
 
(1,155
)
  
 
6,372
 
Other assets, current and non-current
  
 
913
 
  
 
(2,182
)
Accounts payable
  
 
(1,216
)
  
 
(4,696
)
Accrued expenses and other liabilities
  
 
(871
)
  
 
(486
)
Deferred revenue
  
 
(364
)
  
 
(5,023
)
    


  


Net cash used in operating activities
  
 
(9,777
)
  
 
(6,504
)
    


  


Cash flows from investing activities:
                 
Purchases of investments
  
 
(50,010
)
  
 
(124,679
)
Proceeds from maturities and sales of investments
  
 
60,485
 
  
 
82,605
 
Purchases of privately-held investments
  
 
—  
 
  
 
(150
)
Acquisition of property and equipment
  
 
(2,379
)
  
 
(3,657
)
    


  


Net cash provided by (used in) investing activities
  
 
8,096
 
  
 
(45,881
)
    


  


Cash flows from financing activities:
                 
Repayment of capital lease obligations
  
 
—  
 
  
 
(350
)
Proceeds from issuance of common stock, net of repurchases
  
 
82
 
  
 
1,218
 
Repayment of notes receivable from stockholders
  
 
7
 
  
 
58
 
    


  


Net cash provided by financing activities
  
 
89
 
  
 
926
 
    


  


Net decrease in cash and cash equivalents
  
 
(1,592
)
  
 
(51,459
)
Cash and cash equivalents at beginning of period
  
 
123,374
 
  
 
139,917
 
    


  


Cash and cash equivalents at end of period
  
$
121,782
 
  
$
88,458
 
    


  


Non-cash investing and financing activities:
                 
Reductions in unearned stock compensation
  
$
(401
)
  
$
(1,550
)
    


  


 
See accompanying notes to these condensed consolidated financial statements.

5


Table of Contents
 
AGILE SOFTWARE CORPORATION
 
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
 
1.    Basis of Presentation
 
The accompanying unaudited condensed consolidated financial statements of Agile Software Corporation and its subsidiaries (“Agile” or the “Company”) have been prepared by the Company and reflect all adjustments (all of which are normal and recurring in nature) that, in the opinion of management, are necessary for a fair presentation of the interim periods presented. The results of operations for the interim period presented are not necessarily indicative of the results to be expected for any subsequent quarter or for the fiscal year ending April 30, 2003. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted in accordance with the Securities and Exchange Commission’s rules and regulations. These unaudited condense