system-on-chip (SoC) memory intellectual property (IP), today reported
financial results for the fourth quarter and year ended
2008
Recent Highlights
-
Reported total fourth quarter revenue of
$4.0 million -
Ended the year with cash and investments of
$67.5 million -
Announced plan to exit unprofitable Analog/Mixed-Signal product lines
to lower operating costs
Management Commentary
Commenting on the results,
Executive Officer, stated, “The continued decline in the global economic
environment has resulted in customer projects being delayed or pushed
out, which impacted our license revenue during the quarter. These
results were partially offset by an increase in royalties associated
with the Nintendo Wii game console and royalties generated by another
major OEM customer that licenses our 1T-
advanced mobile phone applications. During the fourth quarter, we signed
a new license with a mobile phone provider for use of our
application-specific DDI (display driver integrated circuit) memory IP
in their display driver subsystems. We ended the year with five customer
design wins for our DDI solution and brought up support at three
foundries. In addition, we made significant progress with our 1T-FLASH
program, as our lead customer moved into pre-production manufacturing
and expects to begin shipping production samples late first quarter of
2009 with a full production ramp later this year.”
During the fourth quarter, the Company announced a plan to exit its
unprofitable analog/mixed signal product lines. As part of this plan,
the Company will be reducing headcount by approximately 90 employees,
primarily located in
plan in the fourth quarter and expects to substantially complete the
process in the first quarter of 2009. The Company expects to realize
annualized cost savings of approximately
Looking forward, Mr. Perham concluded, “We believe the current weakness
in the global economic environment will extend throughout 2009.
Certainly, the first quarter will be impacted by the continued slowdown
in the consumer market segments beyond the typical seasonality
associated with that quarter. This environment has significantly limited
our near-term visibility, and we will continue our policy of not
providing specific financial guidance until further notice. While we
will be stringently managing our expenses, we will continue to
strategically invest in R&D in order to position the Company for future
growth.”
Fourth Quarter Results
Total net revenue for the fourth quarter of 2008 was
compared with
for the fourth quarter of 2007.
Fourth quarter total revenue included licensing revenue of
compared with
the fourth quarter of 2007. Royalty revenue for the fourth quarter was
game console. This compares with royalty revenue of
previous quarter and
Gross margin as determined in accordance with U.S. Generally Accepted
Accounting Principles (GAAP) was 83.8 percent, compared with 79.2
percent in the third quarter of 2008 and 71.5 percent in the fourth
quarter of 2007.
Total operating expenses on a GAAP basis for the fourth quarter of 2008
were
and asset impairment charges. This compares with
previous quarter and
GAAP net loss for the quarter was
including a restructuring charge of
charge of
and intangible asset amortization charges of
with a net loss of
quarter of 2008 and a net loss of
for the fourth quarter of 2007.
The net loss on a non-GAAP basis for the fourth quarter was
million
impairment, stock-based compensation and intangible asset amortization
charges. A reconciliation of GAAP to non-GAAP results is provided in the
financial tables following the text of this press release.
Earnings per share for the quarter on both a GAAP and non-GAAP basis
were computed using 31.6 million shares.
Cash, cash equivalents and both long and short-term investments totaled
approximately 275,000 shares of its common stock under its repurchase
program at a total cost of approximately
Full Year 2008 Results
Total revenue for 2008 was
fiscal 2007. Net loss for the year, in accordance with GAAP, was
million
or
compensation charges of
intangible asset amortization charges. Non-GAAP net loss for 2007 was
charges of
amortization and in-process research and development charges. Earnings
per share for 2008 were computed using approximately 31.7 million shares
on a GAAP and non-GAAP basis.
Fourth Quarter and Full Year 2008 Financial Results Webcast /
Conference Call
quarter and full year results. Investors and other interested parties
may access the call by dialing 1-888-679-8033 in the U.S.
(617-213-4846 outside of the U.S.), and entering the pass code 14111930
at least 10 minutes prior to the start of the call. In addition, an
audio webcast will be available through the MoSys Web site at https://dev-mosys-web-04-19.pantheonsite.io.
A telephone replay will be available for two business days following the
call at 888-286-8010 in the U.S. (617-801-6888 outside of the U.S.),
pass code of 52745907.
Use of Non-GAAP Financial Measures
To supplement MoSys’ consolidated financial statements presented in
accordance with GAAP,
exclude from the income statement the effects of restructuring and asset
impairment charges related to the Company’s exit from its
analog/mixed-signal product lines, stock-based compensation and the
effects of certain charges related to acquired intangible assets and
other acquisition-related charges from its acquisition of the
analog/mixed-signal design teams and related design know-how from
Corporation
presentation of these non-GAAP financial measures is useful to investors
and other interested persons because they are one of the primary
indicators that MoSys’ management uses for planning and forecasting
future performance.
financial measures that exclude these items is useful to investors
because
business or reflective of the core operational activities of the Company
that are within the control of management or that would be used to
evaluate management’s operating performance.
Investors are encouraged to review the reconciliation of these non-GAAP
financial measures to the comparable GAAP results, which is provided in
a table immediately below the Condensed Consolidated Statements of
Operations. The non-GAAP financial measures disclosed by the Company
should not be considered a substitute for, or superior to, financial
measures calculated in accordance with GAAP, and the financial results
calculated in accordance with GAAP and reconciliations to those
financial statements should be carefully evaluated. 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. For additional information regarding these
non-GAAP financial measures, and management’s explanation of why it
considers such measures to be useful, refer to the Form 8-K dated
Exchange Commission
Forward-Looking Statements
This press release may contain forward-looking statements about the
Company, including, without limitation, benefits and performance
expected from use of the Company’s 1T-
the Company’s execution and results, improving operational efficiencies,
growth of the business and future business prospects and the estimated
restructuring charges and costs and cost savings, including the timing
of such savings, related to the restructuring plan.
Forward-looking statements are based on certain assumptions and
expectations of future events that are subject to risks and
uncertainties. Actual results and trends may differ materially from
historical results or those projected in any such forward-looking
statements depending on a variety of factors. These factors include, but
are not limited to, customer acceptance of our proprietary technologies
for 1T-
agreements to be entered into with our customers and their requests for
our services under existing license agreements, the timing of customer
acceptance of our work under such agreements, the level of commercial
success of licensees’ products, ease of manufacturing and yields of
devices incorporating our proprietary technologies, our ability to
enhance our existing proprietary technologies and develop new
technologies, the level of intellectual property protection provided by
our patents, the expenses and other consequences of litigation,
including intellectual property infringement litigation, to which we may
be or may become a party from time to time, the vigor and growth of
markets served by our licensees and customers and operations of the
Company, assumptions including the timing and execution of restructuring
plans and programs subject to local labor law requirements, including
consultation with appropriate works councils; assumptions related to
severance costs and other risks identified in the Company’s most recent
reports on forms 10-Q and 10-K filed with the
Commission
with the
obligation to update publicly any forward-looking statement for any
reason, except as required by law, even as new information becomes
available or other events occur in the future.
About
Founded in 1991,
innovative embedded memory intellectual property (IP) technologies for
advanced systems-on-chips (SoCs) used in a variety of home
entertainment, mobile consumer, networking and storage applications.
high density, low power consumption, high speed and low cost unmatched
by other available memory technologies.
been included in more than 160 million devices demonstrating
silicon-proven manufacturability in a wide range of processes and
applications.
website at https://dev-mosys-web-04-19.pantheonsite.io.
1T-FLASH(TM) is a trademark of
MOSYS, INC. | |||||||||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | |||||||||||||||||||
(In thousands, except per share amounts; unaudited) | |||||||||||||||||||
Three Months Ended | Twelve Months Ended | ||||||||||||||||||
December 31, | December 31, | ||||||||||||||||||
2008 | 2007 | 2008 | 2007 | ||||||||||||||||
Net Revenue | |||||||||||||||||||
Licensing | $ | 859 | $ | 388 | $ | 3,156 | $ | 5,253 | |||||||||||
Royalty | 3,101 | 2,511 | 10,870 | 9,081 | |||||||||||||||
Total net revenue | 3,960 | 2,899 | 14,026 | 14,334 | |||||||||||||||
Cost of Net Revenue | |||||||||||||||||||
Licensing | 642 | 825 | 2,800 | 2,737 | |||||||||||||||
Total cost of net revenue | 642 | 825 | 2,800 | 2,737 | |||||||||||||||
Gross Profit | 3,318 | 2,074 | 11,226 | 11,597 | |||||||||||||||
Operating Expenses | |||||||||||||||||||
Research and development | 4,005 | 4,174 | 16,426 | 11,594 | |||||||||||||||
Selling, general and administrative | 2,952 | 3,309 | 11,875 | 11,659 | |||||||||||||||
In-process research and development | – | – | – | 966 | |||||||||||||||
Amortization of intangible assets | 151 | 197 | 742 | 394 | |||||||||||||||
Impairment of intangible assets | 1,379 | – | 1,379 | – | |||||||||||||||
Restructuring charge | 1,334 | – | 1,334 | – | |||||||||||||||
Total operating expenses | 9,821 | 7,680 | 31,756 | 24,613 | |||||||||||||||
Loss from operations | (6,503 | ) | (5,606 | ) | (20,530 | ) | (13,016 | ) | |||||||||||
Other income, net | 217 | 1,015 | 2,243 | 4,520 | |||||||||||||||
Loss before income taxes | (6,286 | ) | (4,591 | ) | (18,287 | ) | (8,496 | ) | |||||||||||
Benefit (provision) for income taxes | (21 | ) | 8 | (132 | ) | (25 | ) | ||||||||||||
Net loss | $ | (6,307 | ) | $ | (4,583 | ) | $ | (18,419 | ) | $ | (8,521 | ) | |||||||
Net loss per share | |||||||||||||||||||
Basic and diluted | ($0.20 | ) | ($0.14 | ) | ($0.58 | ) | ($0.27 | ) | |||||||||||
Shares used in computing net loss per share | |||||||||||||||||||
Basic and diluted | 31,623 | 32,117 | 31,698 | 31,994 |
MOSYS, INC. | ||||||||||
Reconciliation of GAAP to Non-GAAP Net Loss and Net Loss Per Share | ||||||||||
(In thousands, except per share amounts; unaudited) | ||||||||||
Three Months Ended | Twelve Months Ended | |||||||||
December 31, | December 31, | |||||||||
2008 | 2007 | 2008 | 2007 | |||||||
GAAP net loss | $ (6,307) | $ (4,583) | $ (18,419) | $ (8,521) | ||||||
Stock-based compensation expense | ||||||||||
– Cost of net revenue | 66 | 178 | 408 | 495 | ||||||
– Research and development | 261 | 363 | 1,197 | 1,162 | ||||||
– Selling, general and administrative | 673 | 651 | 2,972 | 2,109 | ||||||
Total stock-based compensation expense |
1,000 | 1,192 | 4,577 | 3,766 | ||||||
In-process research and development | – | – | – | 966 | ||||||
Amortization of intangible assets | 151 | 197 | 742 | 394 | ||||||
Impairment of intangible assets (1) | 1,379 | – | 1,379 | – | ||||||
Restructuring charge (1) | 1,334 | – | 1,334 | – | ||||||
Non-GAAP net loss | $ (2,443) | $ (3,194) | $ (10,387) | $ (3,395) | ||||||
GAAP net loss per share | ($0.20) | ($0.14) | ($0.58) | ($0.27) | ||||||
Reconciling items | ||||||||||
– Stock-based compensation expense | 0.03 | 0.04 | 0.15 | 0.12 | ||||||
– In-process research and development | – | – | – | 0.03 | ||||||
– Amortization of intangible assets | 0.01 | – | 0.02 | 0.01 | ||||||
– Impairment of intangible assets (1) | 0.04 | – | 0.04 | – | ||||||
– Restructuring charge (1) | 0.04 | – | 0.04 | – | ||||||
Non-GAAP net loss per share: Basic and diluted | ($0.08) | ($0.10) | ($0.33) | ($0.11) | ||||||
Shares used in computing non-GAAP net loss per share | ||||||||||
Basic and diluted | 31,623 | 32,117 | 31,698 | 31,994 | ||||||
(1) Charges related to the exit of the analog/mixed-signal product lines |
MOSYS, INC. | |||||||||
CONDENSED CONSOLIDATED BALANCE SHEETS | |||||||||
(in thousands, unaudited) | |||||||||
December 31, | December 31, | ||||||||
2008 | 2007 | ||||||||
Assets | |||||||||
Current assets: | |||||||||
Cash, cash equivalents and investments | $ | 44,075 | $ | 64,961 | |||||
Accounts receivable, net | 688 | 895 | |||||||
Unbilled contract receivables | 428 | 518 | |||||||
Prepaid expenses and other assets | 2,158 | 2,393 | |||||||
Total current assets | 47,349 | 68,767 | |||||||
Long-term investments | 23,395 | 13,693 | |||||||
Property and equipment, net | 958 | 1,396 | |||||||
Goodwill | 12,326 | 12,326 | |||||||
Intangible assets, net | – | 2,166 | |||||||
Other assets | 1,905 | 449 | |||||||
Total assets | $ | 85,933 | $ | 98,797 | |||||
Liabilities and Stockholders’ Equity | |||||||||
Current liabilities: | |||||||||
Accounts payable | $ | 167 | $ | 146 | |||||
Accrued expenses and other liabilities | 2,235 | 2,158 | |||||||
Accrued restructuring liabilities | 1,004 | – | |||||||
Deferred revenue | 639 | 201 | |||||||
Total current liabilities | 4,045 | 2,505 | |||||||
Stockholders’ equity | 81,888 | 96,292 | |||||||
Total liabilities and stockholders’ equity | $ | 85,933 | $ | 98,797 |
Source:
MoSys, Inc.
Jim Sullivan, CFO, 408-731-1800
jsullivan@mosys.com
or
Shelton
Group, Investor Relations
Beverly Twing, Sr. Acct. Manager,
972-239-5119 ext. 126
btwing@sheltongroup.com