As a supplement to the Company's condensed consolidated financial statements presented in accordance with generally accepted accounting principles ("GAAP"), the Company provides additional non-GAAP measures for cost of revenues, gross profit, gross profit percentage, research and development expense, selling, general and administrative expense, amortization of purchased intangible assets, restructuring costs and other charges, other income (expense), provision for income taxes, operating expenses, operating income, operating margin percentage, net income (loss), and basic and diluted net income (loss) per share.

A non-GAAP financial measure is a numerical measure of a company's performance, financial position, or cash flows that either excludes or includes amounts that are not normally excluded or included in the most directly comparable measure calculated and presented in accordance with GAAP.  The Company believes that the additional non-GAAP measures are useful to investors for the purpose of financial analysis.  Management uses these measures internally to evaluate the Company's in-period operating performance before gains, losses and other charges that are considered by management to be outside of the Company's core operating results.  In addition, the measures are used for planning and forecasting of the Company's future periods.  However, non-GAAP measures are not in accordance with, nor are they a substitute for, GAAP measures.  Other companies may use different non-GAAP measures and presentation of results.

2011⁽¹⁾

2011⁽²⁾

2010⁽³⁾

2011⁽⁴⁾

2010⁽⁵⁾

2011⁽¹⁾

2011⁽²⁾

2010⁽³⁾

2011⁽⁴⁾

2010⁽⁵⁾

(1) $7.0 million stock-based compensation expense; $1.2 million acquisition related costs; $11.0 million amortization of purchased intangible assets; $0.3 million foreign exchange loss on foreign tax liabilities; $0.9 million of non-cash interest expense for the accretion of the debt discount related to the senior convertible notes; $0.3 million accretion of liability for contingent consideration; and $2.7 million income tax provision which includes $1.6 million income tax provision relating to inter-company transactions, $1.2 million net tax expense relating to foreign exchange translation of a foreign subsidiary, $0.9 million reduction of stock option related loss carry-forward benefit recognized in equity, $0.6 million arrears interest relating to unrecognized tax benefits, $0.5 million income tax provision for adjustments relating to prior periods, and $0.3 million income tax recovery related to stock-based compensation.

(2) $6.3 million stock-based compensation expense; $10.4 million acquisition related costs; $3.4 million lease exit costs; $11.0 million amortization of purchased intangible assets; $1.0 million foreign exchange loss on foreign tax liabilities; $0.9 million of non-cash interest expense for the accretion of the debt discount related to the senior convertible notes; $0.5 million accretion of liability for contingent consideration; $0.3 million interest expense related to short-term loan; and $4.5 million income tax provision which includes $2.2 million sheltered by the benefit of stock option related loss carry-forwards recognized in equity, $3.6 million income tax provision relating to inter-company transactions, $1.9 million net tax recovery relating to foreign exchange translation of a foreign subsidiary, and $0.6 million arrears interest relating to unrecognized tax benefits.

(3) $5.7 million stock-based compensation expense; $1.5 million acquisition related costs; $6.8 million amortization of purchased intangible assets; $0.8 million of non-cash interest expense for the accretion of the debt discount related to the senior convertible notes; and $2.7 million income tax provision which includes $2.1 million income tax provision relating to inter-company transactions, $0.5 million arrears interest relating to unrecognized tax benefits, $0.3 million net tax expense relating to foreign exchange translation of a foreign subsidiary, and $0.2 million deferred tax recovery related to non-deductible intangible asset amortization.

(4) $13.4 million stock-based compensation expense; $11.6 million acquisition related costs;  $3.4 million lease exit costs; $22.1 million amortization of purchased intangible assets; $1.2 million foreign exchange loss on foreign tax liabilities; $1.7 million of non-cash interest expense for the accretion of the debt discount related to the senior convertible notes; $0.8 million accretion of liability for contingent consideration; $0.3 million interest related to short-term loan; and $7.2 million income tax provision which includes $1.3 million sheltered by the benefit of stock option related loss carry-forwards recognized in equity, $5.3 million income tax provision relating to inter-company transactions, $0.7 million net tax recovery relating to foreign exchange translation of a foreign subsidiary, $1.2 million arrears interest relating to unrecognized tax benefits, $0.4 million income tax provision for adjustments relating to prior periods, and $0.3 million income tax recovery related to stock-based compensation.

(5) $11.0 million stock-based compensation expense; $1.5 million acquisition related costs; $16.7 million amortization of purchased intangible assets; $0.3 million restructuring costs; $1.0 million foreign exchange loss on foreign tax liabilities; $1.6 million of non-cash interest expense for the accretion of the debt discount related to the senior convertible notes; and $2.0 million income tax provision which includes $3.6 million income tax provision relating to inter-company transactions, $1.9 million net tax recovery relating to foreign exchange translation of a foreign subsidiary, $1.0 million arrears interest relating to unrecognized tax benefits, and $0.7 million deferred tax recovery relating to non-deductible intangible asset amortization.

PMC special shares convertible into 1,029 (2010 - 1,370) shares of common stock