Attached files
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| 8-K - BIG BANK NETWORKS INC 8-K 7-25-2011 - BigBand Networks, Inc. | form8k.htm |
Exhibit 99.1
BigBand Announces Second Quarter 2011 Results
REDWOOD CITY, Calif., July 25, 2011—BigBand Networks, Inc. (NASDAQ: BBND), a leader in digital video networking, today reported financial results for the second quarter ended June 30, 2011.
For the second quarter, total revenues were $19.8 million as compared to $26.4 million reported in the second quarter of 2010. GAAP net loss for the second quarter of 2011 was $8.2 million, or ($0.12) per share, compared to GAAP net loss of $9.6 million, or ($0.14) per share, reported in the second quarter of 2010.
On a non-GAAP basis, the Company reported a net loss of $5.6 million, or ($0.08) per share, in the second quarter of 2011, which compares to a non-GAAP net loss of $5.1 million, or ($0.07) per share, reported in the second quarter of 2010. Second quarter 2011 non-GAAP results exclude $2.6 million in stock-based compensation expense and related income taxes. The GAAP to non-GAAP reconciling items, for the quarters ended June 30, 2011 and 2010 can be found in “The Reconciliations of GAAP to Non-GAAP Financial Measures” attached to this press release.
The Company ended the second quarter of 2011 with $127.9 million in cash, cash equivalents and marketable securities.
“In the quarter, we made good progress in our growth initiatives, including a major win for our new MSP platform with AT&T. This win validates the MSP’s highly-differentiated advertising capabilities and position in IP Video and opens new opportunities with telco and cable customers,” commented Amir Bassan-Eskenazi, President and CEO of BigBand Networks. “Broadcast Video, QAM and SDV (Switched Digital Video) continued to contribute solidly to revenue in the quarter and we are pleased with the progress we have made with our new products.”
Third Quarter 2011 Business Outlook
For the third quarter of 2011, management provides the following outlook:
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·
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Net revenues are expected to be in the range of $20 million to $23 million
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·
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GAAP net loss per share is expected to be in the range of ($0.10) to ($0.12)
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·
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Non-GAAP net loss per share is expected to be in the range of ($0.07) to ($0.09)
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The following table shows our non-GAAP outlook for the quarter ending September 30, 2011 reconciled to our GAAP outlook. Our non-GAAP outlook excludes stock-based compensation charges and related taxes.
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Estimated loss per Share
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||||||||
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Low
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High
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|||||||
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GAAP net loss
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$ | (0.10 | ) | $ | (0.12 | ) | ||
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Stock-based compensation and related taxes
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0.03 | 0.03 | ||||||
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Non-GAAP net loss
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$ | (0.07 | ) | $ | (0.09 | ) | ||
Non-GAAP Financial Measures
BigBand reports all financial information required in accordance with U.S. generally accepted accounting principles (GAAP), but we believe that evaluating our ongoing operating results may be difficult to understand if limited to reviewing only GAAP financial measures. Many of our investors have requested that we disclose non-GAAP information because it is useful in understanding our performance as it excludes non-cash and other one-time charges or benefits that many investors feel may obscure our true operating results. Likewise, management uses non-GAAP measures to manage and assess the profitability of our business going forward and does not consider stock-based compensation expense or restructuring charges and related taxes in managing our operations. Specifically, management does not consider these expenses/benefits when developing and monitoring our budgets and spending. The economic substance behind our decision to exclude stock-based compensation is that this charge is non-cash in nature. We exclude restructuring charges as they are one-time events. As a result, we use calculations of non-GAAP operating loss, net loss, net loss per share and gross margin, which exclude these expenses when evaluating our ongoing operations and allocating resources within the organization.
As a result, our management believes it is useful, for itself and investors, to have access to both GAAP information that includes such charges and non-GAAP financial measures that exclude these charges because management believes such information enables readers of these financial results to have a better understanding of the overall performance of our ongoing business operations in the periods presented.
Whenever we use a non-GAAP financial measure, we provide a reconciliation of the non-GAAP financial measure to the most closely applicable GAAP financial measure. Investors are encouraged to review the related GAAP financial measures and the reconciliation of these non-GAAP financial measures to their most directly comparable GAAP financial measure.
Conference Call Details for July 25, 2011
BigBand Networks will host a corresponding conference call and live webcast at 2:00 p.m. Pacific Time today. To access the conference call, dial +1-877-941-4774 for the U.S. or Canada and +1-480-629-9760 for international callers. The webcast will be available live on the Investor Relations section of the Company’s corporate website at www.bigbandnet.com, and via replay beginning approximately two hours after the completion of the call until the Company’s announcement of its financial results for the next quarter. An audio replay of the call will also be available to investors beginning at approximately 4:00 p.m. Pacific Time on July 25, 2011 until 11:59 p.m. Pacific Time on August 1, 2011, by dialing +1-800-406-7325 or +1-303-590-3030 for callers outside the U.S. and Canada, and entering passcode 4456047#.
Cautionary Statement
The statements in this release regarding the deployment of the MSP by AT&T validates our advertising capabilities, positions us as leaders in IP video and opens new opportunities with telco and cable customers, as well as our GAAP and non-GAAP business outlook, as applicable, with respect to the quarter ending September 30, 2011 (including revenues, stock based compensation and net loss per share) are forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements involve risks and uncertainties that could cause our actual results to differ materially, including, but not limited to: unexpected delays in the delivery of our solutions, changes in demand for video services, the market acceptance of our products; the financial strengths of our current and potential customers; the fluctuations in our gross margins; the concentration of our customer base; competitive developments including pricing pressures; the timing of recognition of a significant portion of our net revenues given the complex systems integration involved; our ability to manage operating expenses effectively; the level of orders that are received and can be shipped in a given quarter; and the general economic, industry or political conditions in the United States or internationally.
For a detailed discussion of these and other risk factors, please refer to BigBand’s Quarterly Report on Form 10-Q for three months ended March 31, 2011 and other reports filed with the SEC. You can obtain copies of the reports on the SEC's Web site (www.sec.gov).
Stockholders of BigBand Networks are cautioned not to place undue reliance on our forward-looking statements, which speak only as of the date such statements are made. BigBand Networks does not undertake any obligation to publicly update any forward-looking statements to reflect events, circumstances or new information after this July 25, 2011 press release, or to reflect the occurrence of unanticipated events.
About BigBand Networks
BigBand Networks, Inc. [NASDAQ: BBND] provides broadband service providers with innovative digital video networking solutions designed to make it easier to move, manage and monetize video. These solutions are based on BigBand's video-networking platforms that are built to enable efficient and reliable delivery across a wide range of services, including digital TV, high definition TV, advanced advertising, IPTV, video-on-demand and interactive TV. BigBand Networks has done business with more than 200 customers in North America, Asia and Europe -- including eight of the ten largest cable and telco service providers in North America. BigBand Networks is based in Redwood City, Calif., with offices worldwide. For additional information about the company, please call +1.650.995.5000, email info@bigbandnet.com or visit www.bigbandnet.com.
BigBand Networks' brand and product names are service marks, trademarks or registered trademarks of BigBand Networks, Inc. in the United States and other countries. All other marks are the property of their respective owners.
Investor Relations:
Erica Abrams
+1.415.217.5864
erica@blueshirtgroup.com
Matthew Hunt
+1.415.489.2194
matt@blueshirtgroup.com
BigBand Networks, Inc.
Condensed Consolidated Balance Sheets
(In thousands, Unaudited)
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As of
June 30, |
As of
December 31, |
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2011
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2010
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ASSETS
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Current assets:
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Cash and cash equivalents
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$ | 19,998 | $ | 21,537 | ||||
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Marketable securities
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107,905 | 122,012 | ||||||
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Total cash, cash equivalents and marketable securities
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127,903 | 143,549 | ||||||
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Accounts receivable, net
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9,111 | 5,001 | ||||||
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Inventories, net
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10,874 | 11,117 | ||||||
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Prepaid expenses and other current assets
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3,844 | 4,190 | ||||||
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Total current assets
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151,732 | 163,857 | ||||||
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Property and equipment, net
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7,087 | 8,088 | ||||||
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Goodwill
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1,656 | 1,656 | ||||||
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Other non-current assets
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6,743 | 7,170 | ||||||
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Total assets
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$ | 167,218 | $ | 180,771 | ||||
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LIABILITIES AND STOCKHOLDERS’ EQUITY
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Current liabilities:
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Accounts payable
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$ | 6,605 | $ | 4,656 | ||||
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Accrued compensation and related benefits
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5,915 | 5,178 | ||||||
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Current portion of deferred revenues, net
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19,365 | 18,143 | ||||||
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Current portion of other liabilities
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3,477 | 4,266 | ||||||
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Total current liabilities
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35,362 | 32,243 | ||||||
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Deferred revenues, net, less current portion
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6,807 | 8,327 | ||||||
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Other liabilities, less current portion
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1,577 | 1,692 | ||||||
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Accrued long-term Israeli severance pay
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4,657 | 4,376 | ||||||
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Stockholders’ equity:
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Common stock
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71 | 70 | ||||||
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Additional paid-in-capital
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304,715 | 299,003 | ||||||
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Accumulated other comprehensive income
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218 | 253 | ||||||
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Accumulated deficit
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(186,189 | ) | (165,193 | ) | ||||
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Total stockholders’ equity
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118,815 | 134,133 | ||||||
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Total liabilities and stockholders’ equity
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$ | 167,218 | $ | 180,771 | ||||
BigBand Networks, Inc.
Condensed Consolidated Statements of Operations
(In thousands, except per share amounts, Unaudited)
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Three Months Ended June 30,
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Six Months Ended June 30,
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2011
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2010
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2011
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2010
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Net revenues:
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Products
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$ | 10,258 | $ | 16,605 | $ | 19,787 | $ | 41,486 | ||||||||
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Services
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9,520 | 9,788 | 18,356 | 17,142 | ||||||||||||
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Total net revenues
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19,778 | 26,393 | 38,143 | 58,628 | ||||||||||||
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Cost of net revenues:
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Products
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6,181 | 9,402 | 11,947 | 23,326 | ||||||||||||
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Services
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2,792 | 3,032 | 5,835 | 6,309 | ||||||||||||
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Total cost of net revenues
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8,973 | 12,434 | 17,782 | 29,635 | ||||||||||||
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Gross profit
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10,805 | 13,959 | 20,361 | 28,993 | ||||||||||||
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Operating expenses:
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Research and development
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10,677 | 13,110 | 22,060 | 26,602 | ||||||||||||
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Sales and marketing
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4,973 | 5,998 | 10,085 | 12,048 | ||||||||||||
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General and administrative
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3,367 | 4,010 | 7,181 | 8,536 | ||||||||||||
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Restructuring charges
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- | 1,039 | 2,007 | 1,039 | ||||||||||||
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Total operating expenses
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19,017 | 24,157 | 41,333 | 48,225 | ||||||||||||
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Operating loss
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(8,212 | ) | (10,198 | ) | (20,972 | ) | (19,232 | ) | ||||||||
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Interest income
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218 | 337 | 424 | 852 | ||||||||||||
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Other income (expense), net
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22 | (95 | ) | (8 | ) | (183 | ) | |||||||||
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Loss before provision for (benefit from) income taxes
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(7,972 | ) | (9,956 | ) | (20,556 | ) | (18,563 | ) | ||||||||
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Provision for (benefit from) income taxes
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222 | (315 | ) | 440 | (153 | ) | ||||||||||
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Net loss
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$ | (8,194 | ) | $ | (9,641 | ) | $ | (20,996 | ) | $ | (18,410 | ) | ||||
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Basic net loss per common share
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$ | (0.12 | ) | $ | (0.14 | ) | $ | (0.30 | ) | $ | (0.27 | ) | ||||
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Diluted net loss per common share
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$ | (0.12 | ) | $ | (0.14 | ) | $ | (0.30 | ) | $ | (0.27 | ) | ||||
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Shares used in GAAP basic net loss per common share
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70,312 | 68,018 | 70,079 | 67,667 | ||||||||||||
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Shares used in GAAP diluted net loss per common share
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70,312 | 68,018 | 70,079 | 67,667 | ||||||||||||
BigBand Networks, Inc.
Reconciliation of GAAP to Non-GAAP Financial Measures
(In thousands, except per share amounts, Unaudited)
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Three Months Ended June 30, 2011
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GAAP Results
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Stock-based Compensation
and Income Taxes
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Non-GAAP Results
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Net revenues:
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Products
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$ | 10,258 | $ | - | $ | 10,258 | ||||||
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Services
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9,520 | - | 9,520 | |||||||||
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Total net revenues
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19,778 | - | 19,778 | |||||||||
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Cost of net revenues:
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Products
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6,181 | (265 | ) | 5,916 | ||||||||
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Services
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2,792 | (220 | ) | 2,572 | ||||||||
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Total cost of net revenues
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8,973 | (485 | ) | 8,488 | ||||||||
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Gross profit
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10,805 | 485 | 11,290 | |||||||||
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Operating expenses:
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Research and development
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10,677 | (1,100 | ) | 9,577 | ||||||||
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Sales and marketing
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4,973 | (346 | ) | 4,627 | ||||||||
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General and administrative
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3,367 | (608 | ) | 2,759 | ||||||||
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Total operating expenses
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19,017 | (2,054 | ) | 16,963 | ||||||||
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Operating loss
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(8,212 | ) | 2,539 | (5,673 | ) | |||||||
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Interest income
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218 | - | 218 | |||||||||
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Other income
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22 | - | 22 | |||||||||
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Loss before provision for income taxes
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(7,972 | ) | 2,539 | (5,433 | ) | |||||||
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Provision for income taxes
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222 | (52 | ) | 170 | ||||||||
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Net loss
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$ | (8,194 | ) | $ | 2,591 | $ | (5,603 | ) | ||||
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Basic net loss per common share
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$ | (0.12 | ) | $ | (0.08 | ) | ||||||
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Diluted net loss per common share
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$ | (0.12 | ) | $ | (0.08 | ) | ||||||
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Shares used in basic net loss per common share
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70,312 | 70,312 | ||||||||||
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Shares used in diluted net loss per common share
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70,312 | 70,312 | ||||||||||
BigBand Networks, Inc.
Reconciliation of GAAP to Non-GAAP Financial Measures
(In thousands, except per share amounts, Unaudited)
|
Six Months Ended June 30, 2011
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GAAP Results
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Stock-based
Compensation
and Income Taxes
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Restructuring
charges
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Non-GAAP
Results
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Net revenues:
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Products
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$ | 19,787 | $ | - | $ | - | $ | 19,787 | ||||||||
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Services
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18,356 | - | - | 18,356 | ||||||||||||
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Total net revenues
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38,143 | - | - | 38,143 | ||||||||||||
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Cost of net revenues:
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Products
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11,947 | (462 | ) | - | 11,485 | |||||||||||
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Services
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5,835 | (439 | ) | - | 5,396 | |||||||||||
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Total cost of net revenues
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17,782 | (901 | ) | - | 16,881 | |||||||||||
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Gross profit
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20,361 | 901 | - | 21,262 | ||||||||||||
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Operating expenses:
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Research and development
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22,060 | (2,205 | ) | - | 19,855 | |||||||||||
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Sales and marketing
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10,085 | (714 | ) | - | 9,371 | |||||||||||
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General and administrative
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7,181 | (1,407 | ) | - | 5,774 | |||||||||||
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Restructuring charges
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2,007 | - | (2,007 | ) | - | |||||||||||
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Total operating expenses
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41,333 | (4,326 | ) | (2,007 | ) | 35,000 | ||||||||||
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Operating loss
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(20,972 | ) | 5,227 | 2,007 | (13,738 | ) | ||||||||||
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Interest income
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424 | - | - | 424 | ||||||||||||
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Other expense
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(8 | ) | - | - | (8 | ) | ||||||||||
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Loss before provision for income taxes
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(20,556 | ) | 5,227 | 2,007 | (13,322 | ) | ||||||||||
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Provision for income taxes
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440 | (144 | ) | - | 296 | |||||||||||
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Net loss
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$ | (20,996 | ) | $ | 5,371 | $ | 2,007 | $ | (13,618 | ) | ||||||
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Basic net loss per common share
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$ | (0.30 | ) | $ | (0.19 | ) | ||||||||||
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Diluted net loss per common share
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$ | (0.30 | ) | $ | (0.19 | ) | ||||||||||
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Shares used in basic net loss per common share
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70,079 | 70,079 | ||||||||||||||
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Shares used in diluted net loss per common share
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70,079 | 70,079 | ||||||||||||||
BigBand Networks, Inc.
Reconciliation of GAAP to Non-GAAP Financial Measures
(In thousands, except per share amounts and percentages, Unaudited)
|
Three Months Ended June 30,
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Six Months Ended June 30,
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2011
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2010
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2011
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2010
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GAAP and Non-GAAP net revenues as reported
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$ | 19,778 | $ | 26,393 | $ | 38,143 | $ | 58,628 | ||||||||
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GAAP cost of net revenues as reported
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$ | 8,973 | $ | 12,434 | $ | 17,782 | $ | 29,635 | ||||||||
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Stock-based compensation expense
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(485 | ) | (610 | ) | (901 | ) | (1,176 | ) | ||||||||
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Non-GAAP cost of net revenues
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$ | 8,488 | $ | 11,824 | $ | 16,881 | $ | 28,459 | ||||||||
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GAAP gross profit as reported
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$ | 10,805 | $ | 13,959 | $ | 20,361 | $ | 28,993 | ||||||||
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Stock-based compensation expense
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485 | 610 | 901 | 1,176 | ||||||||||||
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Non-GAAP gross profit
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$ | 11,290 | $ | 14,569 | $ | 21,262 | $ | 30,169 | ||||||||
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As a percentage of net revenues:
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GAAP gross profit as reported
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54.6 | % | 52.9 | % | 53.4 | % | 49.5 | % | ||||||||
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Non-GAAP gross profit
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57.1 | % | 55.2 | % | 55.7 | % | 51.5 | % | ||||||||
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GAAP operating loss as reported
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$ | (8,212 | ) | $ | (10,198 | ) | $ | (20,972 | ) | $ | (19,232 | ) | ||||
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Stock-based compensation expense:
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- Cost of net revenues
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485 | 610 | 901 | 1,176 | ||||||||||||
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- Research and development
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1,100 | 1,365 | 2,205 | 2,687 | ||||||||||||
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- Sales and marketing
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346 | 642 | 714 | 1,311 | ||||||||||||
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- General and administrative
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608 | 1,008 | 1,407 | 2,209 | ||||||||||||
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Restructuring charges
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- | 1,039 | 2,007 | 1,039 | ||||||||||||
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Non-GAAP operating loss
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$ | (5,673 | ) | $ | (5,534 | ) | $ | (13,738 | ) | $ | (10,810 | ) | ||||
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GAAP net loss as reported
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$ | (8,194 | ) | $ | (9,641 | ) | $ | (20,996 | ) | $ | (18,410 | ) | ||||
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Stock-based compensation expense
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2,539 | 3,625 | 5,227 | 7,383 | ||||||||||||
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Restructuring charges
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- | 1,039 | 2,007 | 1,039 | ||||||||||||
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Tax benefits (provision)
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52 | (104 | ) | 144 | (125 | ) | ||||||||||
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Non-GAAP net loss
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$ | (5,603 | ) | $ | (5,081 | ) | $ | (13,618 | ) | $ | (10,113 | ) | ||||
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Basic Non-GAAP net loss per common share
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$ | (0.08 | ) | $ | (0.07 | ) | $ | (0.19 | ) | $ | (0.15 | ) | ||||
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Diluted Non-GAAP net loss per common share
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$ | (0.08 | ) | $ | (0.07 | ) | $ | (0.19 | ) | $ | (0.15 | ) | ||||
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Shares used in Basic Non-GAAP net loss per common share
|
70,312 | 68,018 | 70,079 | 67,667 | ||||||||||||
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Shares used in Diluted Non-GAAP net loss per common share
|
70,312 | 68,018 | 70,079 | 67,667 | ||||||||||||