Attached files
| file | filename |
|---|---|
| 8-K - FORM 8-K - SMITH MICRO SOFTWARE, INC. | a59935e8vk.htm |
Exhibit 99.1
AT THE COMPANY:
|
IR INQUIRIES: | |
Thomas P. Matthews
|
Charles Messman, Todd Kehrli | |
Chief Strategy Officer
|
MKR Group | |
949-362-5800
|
323-468-2300 | |
| ir@mkr-group.com |
SMITH MICRO SOFTWARE REPORTS 2011 SECOND QUARTER
FINANCIAL RESULTS
Aliso Viejo, CA, August 2, 2011 — Smith Micro Software, Inc. (NASDAQ: SMSI), a leading
developer and marketer of software solutions and services for the mobility market, today reported
financial results for its second quarter ended June 30, 2011.
“Second quarter revenues were in-line with management guidance. Profitability played-out as we
expected, while we continue to invest in innovation to meet the demands created by transitions in
our industry.” said William W. Smith Jr., President and CEO of Smith Micro Software, “Our product
portfolio is evolving rapidly to address the shifts occurring within our markets and we are
aggressively moving to leverage our technology to align with changing demand. We are pleased with
the progress made to tightly integrate our offerings and execute on our platform strategy, which is
designed to help us maintain our position of leadership in the mobile software industry.”
Smith Micro reported revenues of $16.1 million for the second quarter ended June 30, 2011, compared
to $31.4 million reported in the second quarter ended June 30, 2010.
Second quarter gross profit on a GAAP basis was $12.5 million, compared to $27.4 million
reported in the second quarter of 2010. On a non-GAAP basis (which excludes amortization of
intangibles and stock compensation), second quarter gross profit was $13.8 million, compared to
$28.9 million for the same quarter last year.
GAAP gross profit as a percentage of revenue was 77.9% for the second quarter of 2011, compared to
87.4% for the same quarter last year. Non-GAAP gross profit as a percentage of revenue was 85.7%
for
the second quarter of 2011, compared to 92.3% for the same quarter last year, primarily due to
lower revenue.
GAAP net loss for the second quarter of 2011 was $7.8 million, or a loss of $0.22 per diluted
share, compared to GAAP net income of $1.9 million, or $0.05 per diluted share, for the second
quarter of 2010. Non-GAAP net loss for the second quarter of 2011 was $5.2 million, or a loss of $0.15 per diluted
share, compared to net income of $6.8 million, or $0.20 per diluted share, for the second quarter
of 2010. Total cash and cash equivalents and short-term investments at June 30, 2011 were $62.0 million.
Fully diluted weighted average common shares outstanding as of June 30, 2011 were 35.8 million,
compared to 34.8 million fully diluted weighted average common shares outstanding as of June 30,
2010.
For the six months ended June 30, 2011, the Company reported revenues of $33.9 million, compared to
$61.2 million for the six months ended June 30, 2010.
GAAP gross profit was $26.6 million for the six months ended June 30, 2011, compared to $53.5
million for the six months ended June 30, 2010.
Non-GAAP gross profit (which excludes amortization of intangibles and stock compensation) was $29.1
million for the six months ended June 30, 2011, compared to $56.6 million for the same period last
year.
GAAP net loss for the six months ended June 30, 2011 was $15.6 million, or a loss of $0.44 per
diluted share, compared to GAAP net income for the six months ended June 30, 2010 of $3.5 million,
or $0.10 per diluted share. Non-GAAP net loss for the six months ended June 30, 2011 was $10.0
million, or a loss of $0.28 per diluted share, compared to net income of $13.0 million, or $0.38
per diluted share, for the six months ended June 30, 2010.
The Company uses a non-GAAP reconciliation of gross profit, income before taxes, net income and
earnings per share in the presentation of financial results in this press release. Management
believes that this presentation may be more meaningful in analyzing our income generation, since
amortization of intangibles from acquisitions, stock-based compensation, and non-cash tax expense
are excluded from the non-GAAP earnings calculation. Since we are in a loss position, the non-GAAP
income tax benefit for the six months ended June 30, 2011 is computed by using the Company’s
combined U.S. federal and state statutory tax rate of 40%. This presentation may be considered
more indicative of our ongoing operational performance. The tables below present the differences
between non-GAAP earnings and net income on an absolute and per-share basis. Non-GAAP financial
measures should not be considered in
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isolation from, or as a substitute for, financial information presented in compliance with
GAAP, and the non-financial measures as reported by Smith Micro Software may not be comparable to
similarly titled amounts reported by other companies.
Financial Guidance:
Based on current financial data and management’s current plans and assumptions, Smith Micro is
projecting that its revenues for the third fiscal quarter of 2011 will be between $15 million to
$20 million.
Investor Conference Call:
Smith Micro Software will hold an investor conference call today to discuss the Company’s second
quarter 2011 results at 4:30 p.m. ET, August 2, 2011. To access the call dial (877) 941-6009 and
when prompted provide the pass code “SMSI.” Participants are asked to call the assigned number
approximately 10 minutes before the conference call begins. In addition, the conference call will
be available over the Internet at www.smithmicro.com in the Investor Relations section.
About Smith Micro Software, Inc.:
Smith Micro Software, Inc. creates new possibilities by developing mobile applications and
solutions to solve customer problems. Through our insight into the market, we develop new
applications that put you in control of your digital lifestyle. Our portfolio of products and
services spans Connectivity Management, Communications and Content Management solutions.
To complete Smith Micro’s solutions, the company also provides server software applications and
services to help its customers manage their software investments.
Safe Harbor Statement:
This
release contains forward-looking statements that involve risks and uncertainties, including
without limitation forward-looking statements relating to the company’s quarterly revenues
guidance, its financial prospects and other projections of its performance, the company’s ability
to increase its business and the anticipated timing and financial performance of its new products
and services and potential acquisitions. Among the important factors that could cause actual
results to differ materially from those expressed or implied in the forward-looking statements are
changes in demand for the company’s products from its customers and their end-users, new and changing
technologies and mobile communications products, customer acceptance of those technologies and
products, new and continuing adverse economic conditions, and the company’s ability to compete
effectively with other software providers. These and other factors discussed in the company’s
filings with the Securities and Exchange Commission, including its filings on Forms 10-K and 10-Q,
could cause actual results to differ materially from those expressed or implied in any
forward-looking statements. The forward-looking statements contained in this release are made on
the basis of the views and assumptions of management regarding future events and business
performance as of the date of this release, and the company does not
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undertake any obligation to update these statements to reflect events or circumstances occurring
after the date of this release.
Smith Micro and the Smith Micro logo are registered trademarks or trademarks of Smith Micro
Software, Inc. All other trademarks and product names are the property of their respective
companies.
Note: Financial Schedules Attached
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Smith Micro Software, Inc.
Reconciliation of GAAP to Non-GAAP Results
(in thousands, except per share amounts — unaudited)
Reconciliation of GAAP to Non-GAAP Results
(in thousands, except per share amounts — unaudited)
| Stock | Non- | |||||||||||||||||||
| GAAP | Comp. | Amort. | Taxes | GAAP | ||||||||||||||||
Three Months Ended 06/30/11: |
||||||||||||||||||||
Gross profit |
$ | 12,545 | $ | 5 | $ | 1,259 | $ | 0 | $ | 13,809 | ||||||||||
Income (loss) before taxes |
$ | (13,004 | ) | $ | 2,265 | $ | 2,029 | $ | 0 | $ | (8,710 | ) | ||||||||
Net income (loss) |
$ | (7,847 | ) | $ | 2,265 | $ | 2,029 | $ | (1,656 | ) | $ | (5,209 | ) | |||||||
EPS-diluted |
$ | (0.22 | ) | $ | 0.06 | $ | 0.06 | $ | (0.05 | ) | $ | (0.15 | ) | |||||||
Three Months Ended 06/30/10: |
||||||||||||||||||||
Gross profit |
$ | 27,392 | $ | 25 | $ | 1,526 | $ | 0 | $ | 28,943 | ||||||||||
Income before taxes |
$ | 3,675 | $ | 2,904 | $ | 2,294 | $ | 0 | $ | 8,873 | ||||||||||
Net income |
$ | 1,885 | $ | 2,904 | $ | 2,294 | $ | (251 | ) | $ | 6,832 | |||||||||
EPS-diluted |
$ | 0.05 | $ | 0.08 | $ | 0.07 | $ | 0.00 | $ | 0.20 | ||||||||||
Six Months Ended 06/30/11: |
||||||||||||||||||||
Gross profit |
$ | 26,560 | $ | 22 | $ | 2,519 | $ | 0 | $ | 29,101 | ||||||||||
Income (loss) before taxes |
$ | (25,973 | ) | $ | 5,274 | $ | 4,059 | $ | 0 | $ | (16,640 | ) | ||||||||
Net income (loss) |
$ | (15,600 | ) | $ | 5,274 | $ | 4,059 | $ | (3,684 | ) | $ | (9,951 | ) | |||||||
EPS-diluted |
$ | (0.44 | ) | $ | 0.15 | $ | 0.11 | $ | (0.10 | ) | $ | (0.28 | ) | |||||||
Six Months Ended 06/30/10: |
||||||||||||||||||||
Gross profit |
$ | 53,522 | $ | 53 | $ | 3,010 | $ | 0 | $ | 56,585 | ||||||||||
Income before taxes |
$ | 6,621 | $ | 5,706 | $ | 4,547 | $ | 0 | $ | 16,874 | ||||||||||
Net income |
$ | 3,477 | $ | 5,706 | $ | 4,547 | $ | (737 | ) | $ | 12,993 | |||||||||
EPS-diluted |
$ | 0.10 | $ | 0.17 | $ | 0.13 | $ | (0.02 | ) | $ | 0.38 | |||||||||
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Smith Micro Software, Inc.
Statements of Operations for the Three and Six Months Ended June 30, 2011 and 2010
(in thousands, except per share amounts — unaudited)
Statements of Operations for the Three and Six Months Ended June 30, 2011 and 2010
(in thousands, except per share amounts — unaudited)
| For the Three Months | For the Six Months | |||||||||||||||
| Ended June 30, | Ended June 30, | |||||||||||||||
| 2011 | 2010 | 2011 | 2010 | |||||||||||||
Revenues |
$ | 16,105 | $ | 31,357 | $ | 33,896 | $ | 61,219 | ||||||||
Cost of revenues |
3,560 | 3,965 | 7,336 | 7,697 | ||||||||||||
Gross profit |
12,545 | 27,392 | 26,560 | 53,522 | ||||||||||||
Operating expenses: |
||||||||||||||||
Selling and marketing |
7,097 | 7,398 | 15,459 | 14,688 | ||||||||||||
Research and development |
11,316 | 10,095 | 22,996 | 20,223 | ||||||||||||
General and administrative |
7,178 | 6,217 | 14,163 | 12,023 | ||||||||||||
Total operating expenses |
25,591 | 23,710 | 52,618 | 46,934 | ||||||||||||
Operating income (loss) |
(13,046 | ) | 3,682 | (26,058 | ) | 6,588 | ||||||||||
Interest and other income (expense) |
42 | (7 | ) | 85 | 33 | |||||||||||
Income (loss) before taxes |
(13,004 | ) | 3,675 | (25,973 | ) | 6,621 | ||||||||||
Income tax expense (benefit) |
(5,157 | ) | 1,790 | (10,373 | ) | 3,144 | ||||||||||
Net income (loss) |
$ | (7,847 | ) | $ | 1,885 | $ | (15,600 | ) | $ | 3,477 | ||||||
Earnings (loss) per share: |
||||||||||||||||
Basic |
$ | (0.22 | ) | $ | 0.06 | $ | (0.44 | ) | $ | 0.10 | ||||||
Diluted |
$ | (0.22 | ) | $ | 0.05 | $ | (0.44 | ) | $ | 0.10 | ||||||
Weighted average shares outstanding: |
||||||||||||||||
Basic |
35,775 | 34,264 | 35,520 | 33,999 | ||||||||||||
Diluted |
35,775 | 34,781 | 35,520 | 34,480 | ||||||||||||
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Smith Micro Software, Inc.
Consolidated Balance Sheets
(in thousands)
Consolidated Balance Sheets
(in thousands)
| June 30, | December 31, | |||||||
| 2011 | 2010 | |||||||
| (unaudited) | (audited) | |||||||
ASSETS |
||||||||
Current Assets: |
||||||||
Cash & cash equivalents |
$ | 17,097 | $ | 17,856 | ||||
Short term investments |
44,884 | 54,694 | ||||||
Accounts receivable, net |
12,071 | 29,812 | ||||||
Income tax receivable |
3,048 | 2,872 | ||||||
Inventory, net |
326 | 370 | ||||||
Prepaid and other assets |
1,956 | 1,167 | ||||||
Deferred tax asset |
1,998 | 2,565 | ||||||
Total current assets |
81,380 | 109,336 | ||||||
Equipment & improvements, net |
21,100 | 11,623 | ||||||
Goodwill |
94,231 | 94,231 | ||||||
Intangible assets, net |
15,400 | 19,459 | ||||||
Other assets |
240 | 243 | ||||||
Deferred tax asset |
11,180 | — | ||||||
TOTAL ASSETS |
$ | 223,531 | $ | 234,892 | ||||
LIABILITIES & STOCKHOLDERS’ EQUITY |
||||||||
Current Liabilities: |
||||||||
Accounts payable |
$ | 4,192 | $ | 4,592 | ||||
Accrued liabilities |
7,536 | 8,444 | ||||||
Deferred revenue |
454 | 1,667 | ||||||
Total current liabilities |
12,182 | 14,703 | ||||||
Long-term liabilities |
2,727 | 197 | ||||||
Deferred tax liability |
1,727 | 1,727 | ||||||
Total non-current liabilities |
4,454 | 1,924 | ||||||
Stockholders’ Equity: |
||||||||
Common stock |
36 | 35 | ||||||
Additional paid in capital |
205,932 | 201,702 | ||||||
Accumulated other comprehensive loss |
(11 | ) | (10 | ) | ||||
Accumulated earnings |
938 | 16,538 | ||||||
Total stockholders’ equity |
206,895 | 218,265 | ||||||
TOTAL LIABILITIES & STOCKHOLDERS’ EQUITY |
$ | 223,531 | $ | 234,892 | ||||
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