Cavium Announces Financial Results for Q1 2015

News provided by

Cavium, Inc.

Apr 29, 2015, 04:01 ET

SAN JOSE, Calif., April 29, 2015 /PRNewswire/ -- Cavium, Inc. (NASDAQ: CAVM), a leading provider of semiconductor products that enable secure and intelligent processing for enterprise, data center, wired and wireless networking, today announced financial results for the first quarter ended March 31, 2015.

Net revenue in the first quarter of 2015 was $101.8 million, a 1% sequential increase from the $101.2 million reported in the fourth quarter of 2014 and a 22% year-over-year increase from the $83.2 million reported in the first quarter of 2014.

Generally Accepted Accounting Principles (GAAP) Results

Net loss attributable to the Company in the first quarter of 2015 was $13.9 million, or $(0.25) per diluted share, compared to $12.0 million, or $(0.22) per diluted share in the fourth quarter of 2014. Gross margins were 64.8% in the first quarter of 2015 compared to 62.1% in the fourth quarter of 2014. Total cash and cash equivalents were $121.0 million at March 31, 2015.

Non-GAAP Results

Cavium believes that the presentation of non-GAAP financial measures provides important supplemental information to management and investors regarding financial and business trends relating to Cavium's financial condition and results of operations. These measures should only be used to evaluate Cavium's results of operations in conjunction with the corresponding GAAP measures. The reconciliation between GAAP and non-GAAP financial results is provided in the financial statements portion of this release.

In the first quarter of 2015, Non-GAAP net income was $23.7 million, or $0.40 per diluted share. Non-GAAP gross margin was 65.9% and Non-GAAP operating margin (non-GAAP income from operations as a percentage of revenue) was 22.9%.

Recent News Highlights

  • April 27, 2015 - Cavium's 48 Core Workload-Optimized ThunderX_NT™ Processors Enables New Generation of Accelerated NFV, Edge and Core Networking Applications
  • April 27, 2015 - Cavium Partners with Quantenna and Aquantia to Deliver Fully Secure High Performance 802.11AC MU-MIMO WLAN Access Point Reference Design
  • April 27, 2015 - Cavium Delivers Optimized OpenWRT on OCTEON® III to Accelerate Retail/SMB Router Time to Market
  • April 20, 2015 - Cavium Introduced LiquidSecurity™
  • April 20, 2015 - Cavium Partners with F5 Networks for LiquidSecurity™ Hardware Security Module Family Integration
  • April 20, 2015 - Cavium Announced Collaboration with A10 Networks, KEMP Technologies and ExtraHop for LiquidSecurity™ Hardware Security Module Family
  • April 20, 2015 - Cavium's 48 Core Workload Optimized ThunderX™ SC Processors Enables Next Generation Fully Secure Data Centers
  • March 16, 2015 - E4 Computer Engineering Announced ThunderX™ Based ARKA™ Platform for Specific Workloads in HPC, Cloud and Big Data Applications
  • March 16, 2015 - Cavium Added Support for NVIDIA GPU Accelerators in 64-bit ARMv8-A ThunderX™ Processor Family
  • March 10, 2015 - StackVelocity and Cavium Partnered to Bring Advanced ARM Processor Efficiency to Open Compute Project
  • March 10, 2015 - Hyve Solutions and Cavium Collaborates to Deliver 64-bit ARM-based Server Solutions
  • March 10, 2015 - Cavium's XPliant™ Ethernet Switch Supports the Emerging Open Ecosystems
  • March 2, 2015 - Cavium Introduced OCTEON Fusion-M™
  • March 2, 2015 - Cavium Broke 100Gbps IPsec Throughput Barrier using OpenDataPlane™ at Mobile World Congress 2015
  • February 26, 2015 - Cavium and ARM Demonstrated Comprehensive Cloud RAN Application on 48 Core 64-bit ARMv8-A ThunderX™ SoC Processor at Mobile World Congress 2015
  • February 24, 2015 - Qosmos Showcased Intelligent Service Chaining in a Virtualized Environment Running on Cavium's LiquidIO® Adapter

Cavium, Inc. will broadcast its first quarter of 2015 financial results conference call today, April 29, 2015, at 2 p.m. Pacific time (5 p.m. Eastern time).  The conference call will be available via a live web cast on the investor relations section of the Cavium website at http://www.cavium.com.  Please access the website at least a few minutes prior to the start of the call in order to download and install any necessary audio software. An archived web cast replay of the call will be available on the web site for a limited period of time.

About Cavium

Cavium is a leading provider of highly integrated semiconductor products that enable intelligent processing in enterprise, data center, cloud and wired and wireless service provider applications. Cavium offers a broad portfolio of integrated, software-compatible processors ranging in performance from 100 Mbps to 100 Gbps that enable secure, intelligent functionality in enterprise, data-center, broadband/consumer and access and service provider equipment. Cavium's processors are supported by ecosystem partners that provide operating systems, tool support, reference designs and other services. Cavium's principal office is in San Jose, CA with design team locations in California, Massachusetts, India and China. For more information, please visit: http://www.cavium.com.

CAVIUM, INC.

Unaudited GAAP Condensed Consolidated Statements of Operations

(in thousands, except per share amounts)









Three Months Ended

March 31, 2015

December 31, 2014

Net revenue

$

101,778

$

101,223

Cost of revenue

35,799


38,402

Gross profit

65,979


62,821

Operating expenses:






     Research and development

58,422


55,108

     Sales, general and administrative

20,671


19,314

        Total operating expenses

79,093


74,422

Loss from operations

(13,114)


(11,601)

Other expense, net:






    Interest expense

(410)


(293)

    Other, net

(66)


(313)

Total other expense, net

(476)


(606)

     Loss before income taxes

(13,590)


(12,207)

     Provision for income taxes

301


268

Net loss

(13,891)


(12,475)

Net loss attributable to non-controlling interest

-


(444)

Net loss attributable to the Company

$

(13,891)

$

(12,031)

Net loss attributable to the Company per common share, basic and diluted

$

(0.25)

$

(0.22)

Shares used in computing basic and diluted net loss per common share

54,882


54,249

CAVIUM, INC.

Unaudited Reconciliation of Non-GAAP Adjustments

(in thousands)









Three Months Ended

March 31, 2015

December 31, 2014

Reconciliation of GAAP research and development expenses to non-GAAP:






GAAP research and development expenses

$

58,422

$

55,108

Stock-based compensation and related payroll taxes

(7,823)


(16,128)

Net restructuring related expenses

(254)


(617)

Research and development expenses associated with Xpliant

(20,142)


(8,769)

Non-GAAP research and development expenses

$

30,203

$

29,594








Reconciliation of GAAP sales, general and administrative expenses to non-GAAP:






GAAP sales, general and administrative expenses

$

20,671

$

19,314

Stock-based compensation and related payroll taxes

(5,138)


(5,969)

Amortization of acquired intangible assets

(11)


(33)

Net restructuring related expenses

(68)


(27)

Sales, general and administrative expenses associated with Xpliant

(1,979)


(1,017)

Non-GAAP sales, general and administrative expenses

$

13,475

$

12,268

Total Non-GAAP operating expenses

$

43,678

$

41,862








Reconciliation of GAAP non-operating expenses to non-GAAP non-operating income:






GAAP non-operating expenses

$

(476)

$

(606)

Non-operating expenses associated with Xpliant

1,124


905

Total Non-GAAP non-operating income

$

648

$

299

CAVIUM, INC.

Unaudited Reconciliation of Non-GAAP Adjustments

(in thousands, except per share data and percentages)









Three Months Ended

March 31, 2015

December 31, 2014

Reconciliation of GAAP gross profit & margin to non-GAAP:






Net revenue

$

101,778

$

101,223

GAAP gross profit

65,979


62,821

GAAP gross margin

64.8

%

62.1

%








Stock-based compensation and related payroll taxes

213


237

Amortization of acquired intangible assets

795


1,252

Net restructuring related expenses

42


2,002

Non-GAAP gross profit

$

67,029

$

66,312

Non-GAAP gross margin

65.9

%

65.5

%








Reconciliation of GAAP loss from operations to non-GAAP income from operations:






GAAP loss from operations

$

(13,114)

$

(11,601)

Stock-based compensation and related payroll taxes

13,174


22,334

Amortization of acquired intangible assets

806


1,285

Net restructuring related expenses

364


2,646

Loss from operations of Xpliant

22,121


9,786

Non-GAAP income from operations

$

23,351

$

24,450

Non-GAAP income from operations as a percentage of revenue

22.9

%

24.2

%








Reconciliation of GAAP loss to non-GAAP net income:






GAAP net loss attributable to the Company

$

(13,891)

$

(12,031)

Non-GAAP adjustments:






Stock-based compensation and related payroll taxes

13,174


22,334

Amortization of acquired intangible assets

806


1,285

Net restructuring related expenses

364


2,646

Loss from operations and non-operating expenses of Xpliant

23,245


10,247

Total of non-GAAP adjustments

37,589


36,512

Non-GAAP net income

$

23,698

$

24,481








GAAP net loss attributable to the Company per share, diluted

$

(0.25)

$

(0.22)

Non-GAAP adjustments detailed above

0.65


0.64

Non-GAAP net income attributable to the Company per share, diluted

$

0.40

$

0.42








GAAP weighted average shares, diluted

54,882


54,249

Non-GAAP share adjustment

4,286


4,089

Non-GAAP weighted average shares, diluted

59,168


58,338


CAVIUM, INC.

Unaudited GAAP Condensed Consolidated Balance Sheets

(in thousands)









As of

March 31, 2015

As of

December 31, 2014

Assets






Current assets






Cash and cash equivalents

$

121,025

$

131,718

Accounts receivable, net

56,817


48,199

Inventories

52,312


51,922

Prepaid expenses and other current assets

8,944


9,130

Total current assets

239,098


240,969

Property and equipment, net

58,828


56,963

Intangible assets, net

37,532


37,644

Goodwill

71,478


71,478

Other assets

1,935


1,806

Total assets

$

408,871

$

408,860








Liabilities and Equity






Current liabilities






Accounts payable

$

25,100

$

26,447

Other accrued expenses and other current liabilities

15,945


7,782

Deferred revenue

6,047


6,285

Capital lease and technology license obligations

16,324


23,002

Total current liabilities

63,416


63,516

Capital lease and technology license obligations, net of current

20,788


22,894

Deferred tax liability

2,997


2,836

Other non-current liabilities

2,819


2,931

Total liabilities

90,020


92,177








Stockholders' equity






Common stock

55


54

Additional paid-in capital

505,039


488,981

Accumulated deficit

(186,243)


(172,352)

Total stockholders' equity

318,851


316,683

Total liabilities and stockholders' equity

$

408,871

$

408,860

Logo - http://photos.prnewswire.com/prnh/20120604/LA18845LOGO

SOURCE Cavium, Inc.

Related Links

http://www.cavium.com

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