Extreme Networks Announces Third Quarter Results
Revenues Increase 67 Percent Annually; Q3 Pro Forma Net Loss of $(0.07)
Per Share
Apr 18, 2001, 01:00 ET from Extreme Networks, Inc.
SANTA CLARA, Calif., April 18 /PRNewswire/ --
Extreme Networks, Inc., (Nasdaq: EXTR), a leader in broadband networking
solutions, today announced financial results for its third fiscal quarter
ended March 31, 2001. Revenue for the third quarter of fiscal 2001 increased
to $112.1 million, compared to $67.3 million in the third quarter of fiscal
2000 -- a 67 percent increase annually. Pro forma net loss per share was
$(0.07) on a diluted basis.
Net income, including the impact of amortization of goodwill and
intangibles, for the third quarter of fiscal 2001, was $(70.1) million, or
$(0.64) per share, compared with third quarter fiscal 2000 net income of
$9.1 million, or $0.08 per share, and net income of $8.1 million, or $0.07 per
share, in the second quarter of fiscal 2001. All per-share amounts are
computed on a diluted basis.
Consistent with its April 5, 2001 pre-announcement, Extreme Networks' pro
forma net income, which excludes the effects of the amortization of goodwill
and intangibles, restructuring charges, one-time charges associated with
inventory write-offs, and asset impairments for the third quarter of fiscal
2001, was $(7.1) million, or $(0.07) per share, compared with third quarter of
fiscal 2000 net income of $9.0 million, or $0.08 per share. All per-share
amounts are computed on a diluted basis.
"The continuation of this current economic slowdown has forced companies
to re-evaluate their short-term purchase decisions," said Gordon Stitt, CEO,
Extreme Networks, Inc. "During this period, Extreme Networks will continue to
emphasize its long-term strategy and build upon its core values. Extreme
Networks' strength is that our solutions simplify corporate networks and help
companies achieve greater ROI. Rarely have these two concepts been more
important in the global marketplace than today. By this standard, we remain
optimistic long-term and believe that key decisions made during the last
quarter such as our successful acquisitions of Optranet and Webstacks and our
customer wins with Telia of Sweden and Wind Aziende of Italy will help further
entrench Extreme Networks into broadband networking."
About Extreme Networks
Extreme Networks, Inc. delivers a simplified approach for building
networks based on its corporate vision of Ethernet Everywhere(TM) networks.
The Company's family of BlackDiamond(R), Alpine(TM), and Summit(R) switching
solutions incorporate a unique combination of ExtremeWare(R) management
software and an ASIC-based common architecture to provide Global 2000
enterprises, telecommunications companies, Internet Service Providers and
content providers with the ability to increase the flow of information and
accommodate future network growth.
Headquartered in Santa Clara, Calif., Extreme Networks was listed as the
"Fastest Growing Company in Silicon Valley" based on three-year revenue growth
by the San Jose and Silicon Valley Business Journal. For more information,
visit www.extremenetworks.com.
NOTE: Extreme Networks, ExtremeWare, BlackDiamond and Summit are
registered trademarks of Extreme Networks, Inc., and Alpine and Ethernet
Everywhere are trademarks of Extreme Networks, Inc., in the United States and
other countries.
This announcement contains forward-looking statements that involve risks
and uncertainties. Actual results could differ materially from those projected
in the forward-looking statements as a result of certain risk factors,
including, but not limited to: (i) our limited history of profitability; (ii)
possible delays in the development of new technology and products; (iii) the
ability to procure components for products from single or limited sources;
(iv) a dependence on third-party manufacturers, (v) a highly competitive
business environment for network switching equipment; (vi) a reliance upon
third-party distribution channels to sell products; (vii) fluctuations in
demand for our products and services; and (viii) economic trends in worldwide
geographic markets. More information about potential factors that could affect
our business and financial results is included in our Annual Report on Form
10-K for the year ended June 30, 2000, and the Quarterly Report on Form 10-Q
for the period ended December 31, 2000, including (without limitation) under
the captions, "Management's Discussion and Analysis of Financial Condition and
Results of Operations," and "Risk Factors," which are on file with the
Securities and Exchange Commission
( http://www.sec.gov ).
EXTREME NETWORKS, INC.
PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per-share amounts)
(Unaudited)
Three Months Ended Nine Months Ended
March 31, March 31, March 31, March 31,
2001 2000 2001 2000
Net revenues $112,106 $67,310 $376,163 $169,534
Cost of revenues 57,534 31,971 185,398 80,748
Gross profit 54,572 35,339 190,765 88,786
Operating expenses:
Research and development 16,497 8,102 41,193 22,781
Sales and marketing 41,578 14,798 117,192 38,180
General and administrative 10,284 2,906 19,442 8,204
Total operating expenses 68,359 25,806 177,827 69,165
Operating income(loss) (13,787) 9,533 12,938 19,621
Interest and other income, net 2,864 4,401 9,378 9,841
Income(loss) before income taxes (10,923) 13,934 22,316 29,462
Provision(benefit) for
income taxes (3,823) 4,877 7,782 10,003
Net income (loss) $(7,100) $9,057 $14,534 $19,459
Net income(loss) per share:
Basic $(0.07) $0.09 $0.13 $0.20
Diluted $(0.07) $0.08 $0.12 $0.18
Shares used in computing
per share calculation:
Basic 109,028 103,060 114,804 99,158
Diluted 109,028 113,584 118,091 110,654
This statement of operations information for the three and nine month
periods ended March 31, 2001 and 2000 is for illustrative purposes only and is
not prepared in accordance with generally accepted accounting principles as it
excludes the effects of the following (in thousands):
During the three months ended March 31, 2001, certain inventory charges
included in cost of revenues of $40,330.
During the three months ended March 31, 2001, in-process research and
development of $30,142, which resulted from the acquisitions of
Optranet, Inc. and WebStacks, Inc.
During the three months and nine months ended March 31, 2001, goodwill,
purchased intangibles and deferred stock compensation of $8,239 and
$22,101 respectively.
During the three months ended March 31, 2001, restructuring and one-time
charges of $5,737.
Share and per share data have been restated to give retroactive effect to
a two-for-one stock split in the form of a stock dividend effected in
August 2000.
EXTREME NETWORKS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per-share amounts)
(Unaudited)
Three Months Ended Nine Months Ended
March 31, March 31,March 31, March 31,
2001 2000 2001 2000
Net revenues $112,106 $67,310 $376,163 $169,534
Cost of revenues 97,864 31,971 225,728 80,748
Gross profit 14,242 35,339 150,435 88,786
Operating expenses:
Research and development 16,642 8,102 41,338 22,781
Sales and marketing 44,756 14,798 120,370 38,180
General and administrative 11,839 2,906 20,997 8,204
Goodwill, purchased intangibles
and deferred stock compensation 8,239 -- 22,101 --
In-process research and
development 30,142 -- 30,142 --
Total operating expenses 111,618 25,806 234,948 69,165
Operating income(loss) (97,376) 9,533 (84,513) 19,621
Interest and other income, net 2,005 4,401 8,519 9,841
Income(loss) before income taxes (95,371) 13,934 (75,994) 29,462
Provision(benefit) for income
taxes (25,256) 4,877 (18,474) 10,003
Net income(loss) $(70,115) $9,057 $(57,520) $19,459
Net income(loss) per share:
Basic $(0.64) $0.09 $(0.50) $0.20
Diluted $(0.64) $0.08 $(0.50) $0.18
Shares used in computing per
share calculation:
Basic 109,028 103,060 114,804 99,158
Diluted 109,028 113,584 114,804 110,654
Share and per share data have been restated to give retroactive effect to
a two-for-one stock split in the form of a stock dividend effected in
August 2000.
EXTREME NETWORKS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
March 31, June 30,
2001 2000
(Unaudited) (A)
Assets
Current assets:
Cash, cash equivalents and investments $145,428 $183,361
Accounts receivable, net 88,913 60,996
Inventories, net 63,186 23,801
Deferred tax assets 22,424 13,800
Other current assets 20,619 20,526
Total current assets 340,570 302,484
Property and equipment, net 52,258 26,750
Long-term marketable securities 103,936 124,144
Goodwill and intangibles 125,910 49,782
Other long-term assets 43,861 12,770
Total assets $666,535 $515,930
Liabilities and stockholders' equity
Current liabilities:
Accounts payable $37,731 $39,023
Deferred revenue 46,328 22,042
Accrued liabilities 47,818 35,538
Total current liabilities 131,877 96,603
Long term deposit 266 306
Total stockholders' equity 534,392 419,021
Total liabilities and stockholders' equity $666,535 $515,930
(A) Derived from audited financial statements at June 30, 2000
SOURCE Extreme Networks, Inc.
SANTA CLARA, Calif., April 18 /PRNewswire/ --
Extreme Networks, Inc., (Nasdaq: EXTR), a leader in broadband networking
solutions, today announced financial results for its third fiscal quarter
ended March 31, 2001. Revenue for the third quarter of fiscal 2001 increased
to $112.1 million, compared to $67.3 million in the third quarter of fiscal
2000 -- a 67 percent increase annually. Pro forma net loss per share was
$(0.07) on a diluted basis.
Net income, including the impact of amortization of goodwill and
intangibles, for the third quarter of fiscal 2001, was $(70.1) million, or
$(0.64) per share, compared with third quarter fiscal 2000 net income of
$9.1 million, or $0.08 per share, and net income of $8.1 million, or $0.07 per
share, in the second quarter of fiscal 2001. All per-share amounts are
computed on a diluted basis.
Consistent with its April 5, 2001 pre-announcement, Extreme Networks' pro
forma net income, which excludes the effects of the amortization of goodwill
and intangibles, restructuring charges, one-time charges associated with
inventory write-offs, and asset impairments for the third quarter of fiscal
2001, was $(7.1) million, or $(0.07) per share, compared with third quarter of
fiscal 2000 net income of $9.0 million, or $0.08 per share. All per-share
amounts are computed on a diluted basis.
"The continuation of this current economic slowdown has forced companies
to re-evaluate their short-term purchase decisions," said Gordon Stitt, CEO,
Extreme Networks, Inc. "During this period, Extreme Networks will continue to
emphasize its long-term strategy and build upon its core values. Extreme
Networks' strength is that our solutions simplify corporate networks and help
companies achieve greater ROI. Rarely have these two concepts been more
important in the global marketplace than today. By this standard, we remain
optimistic long-term and believe that key decisions made during the last
quarter such as our successful acquisitions of Optranet and Webstacks and our
customer wins with Telia of Sweden and Wind Aziende of Italy will help further
entrench Extreme Networks into broadband networking."
About Extreme Networks
Extreme Networks, Inc. delivers a simplified approach for building
networks based on its corporate vision of Ethernet Everywhere(TM) networks.
The Company's family of BlackDiamond(R), Alpine(TM), and Summit(R) switching
solutions incorporate a unique combination of ExtremeWare(R) management
software and an ASIC-based common architecture to provide Global 2000
enterprises, telecommunications companies, Internet Service Providers and
content providers with the ability to increase the flow of information and
accommodate future network growth.
Headquartered in Santa Clara, Calif., Extreme Networks was listed as the
"Fastest Growing Company in Silicon Valley" based on three-year revenue growth
by the San Jose and Silicon Valley Business Journal. For more information,
visit www.extremenetworks.com.
NOTE: Extreme Networks, ExtremeWare, BlackDiamond and Summit are
registered trademarks of Extreme Networks, Inc., and Alpine and Ethernet
Everywhere are trademarks of Extreme Networks, Inc., in the United States and
other countries.
This announcement contains forward-looking statements that involve risks
and uncertainties. Actual results could differ materially from those projected
in the forward-looking statements as a result of certain risk factors,
including, but not limited to: (i) our limited history of profitability; (ii)
possible delays in the development of new technology and products; (iii) the
ability to procure components for products from single or limited sources;
(iv) a dependence on third-party manufacturers, (v) a highly competitive
business environment for network switching equipment; (vi) a reliance upon
third-party distribution channels to sell products; (vii) fluctuations in
demand for our products and services; and (viii) economic trends in worldwide
geographic markets. More information about potential factors that could affect
our business and financial results is included in our Annual Report on Form
10-K for the year ended June 30, 2000, and the Quarterly Report on Form 10-Q
for the period ended December 31, 2000, including (without limitation) under
the captions, "Management's Discussion and Analysis of Financial Condition and
Results of Operations," and "Risk Factors," which are on file with the
Securities and Exchange Commission
( http://www.sec.gov ).
EXTREME NETWORKS, INC.
PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per-share amounts)
(Unaudited)
Three Months Ended Nine Months Ended
March 31, March 31, March 31, March 31,
2001 2000 2001 2000
Net revenues $112,106 $67,310 $376,163 $169,534
Cost of revenues 57,534 31,971 185,398 80,748
Gross profit 54,572 35,339 190,765 88,786
Operating expenses:
Research and development 16,497 8,102 41,193 22,781
Sales and marketing 41,578 14,798 117,192 38,180
General and administrative 10,284 2,906 19,442 8,204
Total operating expenses 68,359 25,806 177,827 69,165
Operating income(loss) (13,787) 9,533 12,938 19,621
Interest and other income, net 2,864 4,401 9,378 9,841
Income(loss) before income taxes (10,923) 13,934 22,316 29,462
Provision(benefit) for
income taxes (3,823) 4,877 7,782 10,003
Net income (loss) $(7,100) $9,057 $14,534 $19,459
Net income(loss) per share:
Basic $(0.07) $0.09 $0.13 $0.20
Diluted $(0.07) $0.08 $0.12 $0.18
Shares used in computing
per share calculation:
Basic 109,028 103,060 114,804 99,158
Diluted 109,028 113,584 118,091 110,654
This statement of operations information for the three and nine month
periods ended March 31, 2001 and 2000 is for illustrative purposes only and is
not prepared in accordance with generally accepted accounting principles as it
excludes the effects of the following (in thousands):
During the three months ended March 31, 2001, certain inventory charges
included in cost of revenues of $40,330.
During the three months ended March 31, 2001, in-process research and
development of $30,142, which resulted from the acquisitions of
Optranet, Inc. and WebStacks, Inc.
During the three months and nine months ended March 31, 2001, goodwill,
purchased intangibles and deferred stock compensation of $8,239 and
$22,101 respectively.
During the three months ended March 31, 2001, restructuring and one-time
charges of $5,737.
Share and per share data have been restated to give retroactive effect to
a two-for-one stock split in the form of a stock dividend effected in
August 2000.
EXTREME NETWORKS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per-share amounts)
(Unaudited)
Three Months Ended Nine Months Ended
March 31, March 31,March 31, March 31,
2001 2000 2001 2000
Net revenues $112,106 $67,310 $376,163 $169,534
Cost of revenues 97,864 31,971 225,728 80,748
Gross profit 14,242 35,339 150,435 88,786
Operating expenses:
Research and development 16,642 8,102 41,338 22,781
Sales and marketing 44,756 14,798 120,370 38,180
General and administrative 11,839 2,906 20,997 8,204
Goodwill, purchased intangibles
and deferred stock compensation 8,239 -- 22,101 --
In-process research and
development 30,142 -- 30,142 --
Total operating expenses 111,618 25,806 234,948 69,165
Operating income(loss) (97,376) 9,533 (84,513) 19,621
Interest and other income, net 2,005 4,401 8,519 9,841
Income(loss) before income taxes (95,371) 13,934 (75,994) 29,462
Provision(benefit) for income
taxes (25,256) 4,877 (18,474) 10,003
Net income(loss) $(70,115) $9,057 $(57,520) $19,459
Net income(loss) per share:
Basic $(0.64) $0.09 $(0.50) $0.20
Diluted $(0.64) $0.08 $(0.50) $0.18
Shares used in computing per
share calculation:
Basic 109,028 103,060 114,804 99,158
Diluted 109,028 113,584 114,804 110,654
Share and per share data have been restated to give retroactive effect to
a two-for-one stock split in the form of a stock dividend effected in
August 2000.
EXTREME NETWORKS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
March 31, June 30,
2001 2000
(Unaudited) (A)
Assets
Current assets:
Cash, cash equivalents and investments $145,428 $183,361
Accounts receivable, net 88,913 60,996
Inventories, net 63,186 23,801
Deferred tax assets 22,424 13,800
Other current assets 20,619 20,526
Total current assets 340,570 302,484
Property and equipment, net 52,258 26,750
Long-term marketable securities 103,936 124,144
Goodwill and intangibles 125,910 49,782
Other long-term assets 43,861 12,770
Total assets $666,535 $515,930
Liabilities and stockholders' equity
Current liabilities:
Accounts payable $37,731 $39,023
Deferred revenue 46,328 22,042
Accrued liabilities 47,818 35,538
Total current liabilities 131,877 96,603
Long term deposit 266 306
Total stockholders' equity 534,392 419,021
Total liabilities and stockholders' equity $666,535 $515,930
(A) Derived from audited financial statements at June 30, 2000
SOURCE Extreme Networks, Inc.
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