Calix Achieves Record Revenues in Third Quarter 2013
PETALUMA, CA -- (Marketwired) -- 10/29/13 -- Calix, Inc. (NYSE: CALX) today announced unaudited financial results for the third quarter ended September 28, 2013. Revenue for the third quarter of 2013 was a record $103.6 million, an increase of 27% compared to $81.3 million for the third quarter of 2012.
"Our strong Q3 results reflect our solid execution in the quarter," said Carl Russo, president and CEO of Calix. "Our year-to-date progress reflects the increasing value Calix customers place on transforming their access networks."
Non-GAAP net income for the third quarter of 2013 was $10.2 million, or $0.20 per fully diluted share. Non-GAAP net income was $1.8 million, or $0.04 per fully diluted share, for the third quarter of 2012. A reconciliation of GAAP and non-GAAP results is included as part of this release.
GAAP net income for the third quarter of 2013 was $0.5 million, or $0.01 per basic and diluted share, compared to a GAAP net loss of $7.1 million, or $(0.15) per basic and diluted share for the third quarter of 2012. A reconciliation of our third quarter 2013 operating results from non-GAAP to GAAP is provided below:
| Calix, Inc. | |||||||||||||||||
| (Unaudited, in thousands, except per share data) | |||||||||||||||||
| Three Months Ended September 28, 2013 | |||||||||||||||||
| Non-GAAP | Stock-Based Compensation | Amortization of Intangible Assets | GAAP | ||||||||||||||
| Revenue | $ | 103,628 | $ | -- | $ | -- | $ | 103,628 | |||||||||
| Cost of revenue | 53,770 | 362 | 2,089 | 56,221 | |||||||||||||
| Gross profit | 49,858 | (362) | (2,089) | 47,407 | |||||||||||||
| Gross margin | 48.1% | -0.3% | -2.0% | 45.7% | |||||||||||||
| Operating expenses | 40,258 | 4,609 | 2,552 | 47,419 | |||||||||||||
| Operating income (loss) | 9,600 | (4,971) | (4,641) | (12) | |||||||||||||
| Interest and other income (expense), net | (18) | ) | -- | -- | (18) | ||||||||||||
| Income (loss) before benefit from income taxes | 9,582 | (4,971) | (4,641) | (30) | |||||||||||||
| Benefit from income taxes | (574) | -- | -- | (574) | |||||||||||||
| Net income (loss) | $ | 10,156 | $ | (4,971) | $ | (4,641) | $ | 544 | |||||||||
| Weighted average shares used to computenet income (loss) per common share: | |||||||||||||||||
| Basic | 49,694 | 49,694 | 49,694 | 49,694 | |||||||||||||
| Diluted | 51,142 | 51,142 | 51,142 | 51,142 | |||||||||||||
| Net income (loss) per common share: | |||||||||||||||||
| Basic | $ | 0.20 | $ | (0.10) | $ | (0.09) | $ | 0.01 | |||||||||
| Diluted | $ | 0.20 | $ | (0.10) | $ | (0.09) | $ | 0.01 | |||||||||
Conference Call
In conjunction with this announcement, Calix will host a conference call at 1:30 p.m. Pacific Time (4:30 p.m. Eastern Time) today to discuss its third quarter 2013 financial results. A live audio webcast and replay of the call will be available in the Investor Relations section of the Calix web site at http://investor-relations.calix.com/.
Live call access information: Dial-in number: (877) 407-4019 (U.S.) or (201) 689-8337 (outside the U.S.)
The conference call and webcast will include forward-looking information.
About Calix
Calix (NYSE: CALX) is a global leader in access innovation. Its Unified Access portfolio of broadband communications access systems and software enables communications service providers worldwide to transform their copper- and fiber-based networks and become the broadband provider of choice to their subscribers. For more information, visit the Calix website at www.calix.com.
Use of Non-GAAP Financial Information
The Company uses certain non-GAAP financial measures in this press release to supplement its consolidated financial statements, which are presented in accordance with GAAP. These non-GAAP measures include non-GAAP net income and non-GAAP basic and diluted income per share. These non-GAAP measures are provided to enhance the reader's understanding of the Company's operating performance as they primarily exclude certain non-cash charges for stock-based compensation and amortization of acquisition-related intangible assets, which the Company believes are not indicative of its core operating results. Management believes that the non-GAAP measures used in this press release provide investors with important perspectives into the Company's ongoing business performance and management uses these non-GAAP measures to evaluate financial results and to establish operational goals. The presentation of these non-GAAP measures is not meant to be a substitute for results presented in accordance with GAAP, but rather should be evaluated in conjunction with those GAAP results. A reconciliation of the non-GAAP results to the most directly comparable GAAP results is provided in this press release. The diluted weighted average shares used to compute both GAAP and non-GAAP net income per share include the dilutive effect of outstanding stock options, restricted stock units, performance restricted stock units, and ESPP, which have been calculated under the treasury stock method. The non-GAAP financial measures used by the company may be calculated differently from, and therefore may not be comparable to, similarly titled measures used by other companies.
| Calix, Inc. | ||||||||||||||
| Condensed Consolidated Statements of Operations | ||||||||||||||
| (Unaudited, in thousands, except per share data) | ||||||||||||||
| Three Months Ended | Nine Months Ended | |||||||||||||
| September 28, 2013 |
September 29, 2012 |
September 28, 2013 |
September 29, 2012 |
|||||||||||
| Revenue | $ | 103,628 | $ | 81,301 | $ | 288,615 | $ | 238,794 | ||||||
| Cost of revenue: | ||||||||||||||
| Products and services (1) | 54,132 | 45,707 | 151,323 | 132,797 | ||||||||||
| Amortization of intangible assets | 2,089 | 2,088 | 6,265 | 5,451 | ||||||||||
| Total cost of revenue | 56,221 | 47,795 | 157,588 | 138,248 | ||||||||||
| Gross profit | 47,407 | 33,506 | 131,027 | 100,546 | ||||||||||
| Operating expenses: | ||||||||||||||
| Research and development (1) | 19,777 | 16,165 | 59,983 | 49,604 | ||||||||||
| Sales and marketing (1) | 16,612 | 15,093 | 49,492 | 44,880 | ||||||||||
| General and administrative (1) | 8,478 | 6,773 | 24,293 | 19,682 | ||||||||||
| Amortization of intangible assets | 2,552 | 2,552 | 7,656 | 7,656 | ||||||||||
| Total operating expenses | 47,419 | 40,583 | 141,424 | 121,822 | ||||||||||
| Loss from operations | (12) | ) | (7,077) | ) | (10,397) | ) | (21,276) | ) | ||||||
| Interest and other income (expense), net: | ||||||||||||||
| Interest income | 2 | 3 | 4 | 14 | ||||||||||
| Interest expense | (24) | (41) | (94) | (140) | ) | |||||||||
| Other income (expense), net | 4 | 19 | (318) | (70) | ||||||||||
| Loss before provision for (benefit from) income taxes | (30) | (7,096) | (10,805) | (21,472) | ||||||||||
| Provision for (benefit from) income taxes | (574) | 44 | 7 | 280 | ||||||||||
| Net income (loss) | $ | 544 | $ | (7,140) | $ | (10,812) | $ | (21,752) | ||||||
| Net income (loss) per common share: | ||||||||||||||
| Basic | $ | 0.01 | $ | (0.15) | $ | (0.22) | $ | (0.45) | ||||||
| Diluted | $ | 0.01 | $ | (0.15) | $ | (0.22) | $ | (0.45) | ||||||
| Weighted average shares used to compute net income (loss) per common share: | ||||||||||||||
| Basic | 49,694 | 48,353 | 49,255 | 48,059 | ||||||||||
| Diluted | 51,142 | 48,353 | 49,255 | 48,059 | ||||||||||
| (1) | Includes stock-based compensation as follows: | |||||||||||||
| Cost of revenue | $ | 362 | $ | 345 | $ | 1,090 | $ | 1,089 | ||||||
| Research and development | 1,179 | 1,017 | 3,665 | 3,129 | ||||||||||
| Sales and marketing | 1,395 | 1,263 | 4,138 | 3,840 | ||||||||||
| General and administrative | 2,035 | 1,682 | 6,072 | 4,903 | ||||||||||
| $ | 4,971 | $ | 4,307 | $ | 14,965 | $ | 12,961 | |||||||
| Calix, Inc. | ||||||||||||||||
| Reconciliation of GAAP to Non-GAAP Results | ||||||||||||||||
| (Unaudited, in thousands, except per share data) | ||||||||||||||||
| Three Months Ended | Nine Months Ended | |||||||||||||||
| September 28, 2013 |
September 29, 2012 |
September 28, 2013 |
September 29, 2012 |
|||||||||||||
| GAAP net income (loss) | $ | 544 | $ | (7,140) | $ | (10,812) | $ | (21,752) | ||||||||
| Adjustments to reconcile GAAP net income (loss) to non-GAAP net income: | ||||||||||||||||
| Stock-based compensation | 4,971 | 4,307 | 14,965 | 12,961 | ||||||||||||
| Amortization of intangible assets | 4,641 | 4,640 | 13,921 | 13,107 | ||||||||||||
| Non-GAAP net income | $ | 10,156 | $ | 1,807 | $ | 18,074 | $ | 4,316 | ||||||||
| Non-GAAP net income per common share: | ||||||||||||||||
| Basic | $ | 0.20 | $ | 0.04 | $ | 0.37 | $ | 0.09 | ||||||||
| Diluted | $ | 0.20 | $ | 0.04 | $ | 0.36 | $ | 0.09 | ||||||||
| Weighted average shares used to compute non-GAAP net income per common share: | ||||||||||||||||
| Basic | 49,694 | 48,353 | 49,255 | 48,059 | ||||||||||||
| Diluted | 51,142 | 48,472 | 50,218 | 48,208 | ||||||||||||
| Calix, Inc. | ||||||||||
| Condensed Consolidated Balance Sheets | ||||||||||
| (Unaudited, in thousands) | ||||||||||
| September 28, | December 31, | |||||||||
| 2013 | 2012 | |||||||||
| ASSETS | ||||||||||
| Current assets: | ||||||||||
| Cash and cash equivalents | $ | 79,124 | $ | 46,995 | ||||||
| Restricted cash | 972 | -- | ||||||||
| Accounts receivable, net | 54,421 | 59,519 | ||||||||
| Inventory | 39,376 | 43,282 | ||||||||
| Deferred cost of revenue | 26,826 | 21,077 | ||||||||
| Prepaid expenses and other current assets | 6,656 | 5,677 | ||||||||
| Total current assets | 207,375 | 176,550 | ||||||||
| Property and equipment, net | 18,379 | 21,083 | ||||||||
| Goodwill | 116,175 | 116,175 | ||||||||
| Intangible assets, net | 48,380 | 62,301 | ||||||||
| Other assets | 1,827 | 1,788 | ||||||||
| Total assets | $ | 392,136 | $ | 377,897 | ||||||
| LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||||
| Current liabilities: | ||||||||||
| Accounts payable | $ | 18,073 | $ | 16,804 | ||||||
| Accrued liabilities | 35,034 | 36,176 | ||||||||
| Deferred revenue | 45,202 | 39,315 | ||||||||
| Total current liabilities | 98,309 | 92,295 | ||||||||
| Long-term portion of deferred revenue | 18,197 | 15,782 | ||||||||
| Other long-term liabilities | 1,321 | 745 | ||||||||
| Total liabilities | 117,827 | 108,822 | ||||||||
| Stockholders' equity: | ||||||||||
| Common stock | 1,244 | 1,222 | ||||||||
| Additional paid-in capital | 776,209 | 760,232 | ||||||||
| Accumulated other comprehensive income | 179 | 132 | ||||||||
| Accumulated deficit | (503,323) | (492,511) | ||||||||
| Total stockholders' equity | 274,309 | 269,075 | ||||||||
| Total liabilities and stockholders' equity | $ | 392,136 | $ | 377,897 | ||||||
| Calix, Inc. | ||||||||||
| Condensed Consolidated Statements of Cash Flows | ||||||||||
| (Unaudited, in thousands) | ||||||||||
| Nine Months Ended | ||||||||||
| September 28, | September 29, | |||||||||
| 2013 | 2012 | |||||||||
| Operating activities: | ||||||||||
| Net loss | $ | (10,812) | $ | (21,752) | ||||||
| Adjustments to reconcile net loss to net cash provided by operating activities: | ||||||||||
| Depreciation and amortization | 7,767 | 6,351 | ||||||||
| Loss on retirement of property and equipment | 564 | 262 | ||||||||
| Amortization of intangible assets | 13,921 | 13,107 | ||||||||
| Stock-based compensation | 14,965 | 12,961 | ||||||||
| Changes in operating assets and liabilities: | ||||||||||
| Restricted cash | (972) | 754 | ||||||||
| Accounts receivable, net | 5,098 | (9,359) | ||||||||
| Inventory | 3,906 | 14,855 | ||||||||
| Deferred cost of revenue | (5,749) | (9,063) | ||||||||
| Prepaid expenses and other assets | (466) | 491 | ||||||||
| Accounts payable | 1,269 | 2,186 | ||||||||
| Accrued liabilities | (1,224) | (2,098) | ||||||||
| Deferred revenue | 8,302 | 16,755 | ||||||||
| Other long-term liabilities | 238 | (633) | ||||||||
| Net cash provided by operating activities | 36,807 | 24,817 | ||||||||
| Investing activities: | ||||||||||
| Purchase of property and equipment | (5,475) | (7,879) | ||||||||
| Net cash used in investing activities | (5,475) | (7,879) | ||||||||
| Financing activities: | ||||||||||
| Proceeds from exercise of stock options | 671 | 158 | ||||||||
| Proceeds from employee stock purchase plan | 2,464 | 2,222 | ||||||||
| Taxes withheld upon vesting of restricted stock units and restricted stock awards | (2,102) | (880) | ||||||||
| Payments for debt issuance costs | (301) | -- | ||||||||
| Net cash provided by financing activities | 732 | 1,500 | ||||||||
| Effect of exchange rate changes on cash and cash equivalents | 65 | 46 | ||||||||
| Net increase in cash and cash equivalents | 32,129 | 18,484 | ||||||||
| Cash and cash equivalents at beginning of period | 46,995 | 38,938 | ||||||||
| Cash and cash equivalents at end of period | $ | 79,124 | $ | 57,422 | ||||||