SAN JOSE, Calif., Jan. 12, 2017 /PRNewswire/ -- Quantum Corp.
(NYSE: QTM) today announced preliminary results for the fiscal
third quarter 2017, ended Dec. 31,
2016 that were above the high end of the previously provided
guidance range for both total revenue and profitability. The
company currently expects:
- Total revenue of approximately $133
million, up from $128 million
in the fiscal third quarter 2016.[1] For the first three quarters
of fiscal 2017 (YTD), total revenue grew 8 percent over the same
period in fiscal 2016.
- Scale-out tiered storage revenue[2] (previously referred to as
"scale-out storage revenue") of approximately $40 million, an increase of 12 percent and the
22nd consecutive quarter of year-over-year growth.
Revenue was up 26 percent YTD over the first nine months of fiscal
2016.
- Total data protection revenue of approximately $83 million, up $2
million.
- GAAP operating income of approximately $8 million to $9 million and non-GAAP operating
income of $9 million to $10 million —
an increase of $6 million to
$7 million and $2 million to $3 million, respectively.
- GAAP net income of approximately $6
million to $7 million, or $0.02 per diluted share, and non-GAAP net income
of $7 million to $8 million, or
$0.03 per diluted share — an increase
of $0.02 per diluted share and
$0.01 per diluted share,
respectively.
"We're very pleased with our continued strong performance this
fiscal year," said Jon Gacek,
president and CEO of Quantum. "For the third straight quarter, we
increased total revenue and profit year-over-year, with growth in
both scale-out tiered storage and data protection. In addition,
comparing the first nine months of fiscal 2017 to the same period a
year earlier, we not only grew scale-out tiered storage 26 percent
but also increased branded data protection revenue 7 percent and
improved our GAAP and non-GAAP bottom-line results by approximately
$28 million and $23 million, respectively.
"We ended the quarter with excellent momentum across all product
categories, and we start our fiscal fourth quarter with a strong
backlog and solid funnel. Therefore, we feel very confident in our
ability to deliver year-over-year revenue growth again in the
current quarter and exceed our annual revenue and profitability
guidance for fiscal 2017."
Quantum will provide more detailed financial results for the
fiscal third quarter and updated guidance for fiscal 2017 in its
earnings announcement on Jan. 25,
2017 (see below for conference call information).
Earnings Conference Call and Audio Webcast
Notification
Quantum will issue a news release on its
fiscal third quarter financial results on Wednesday, Jan. 25, 2017, after the close of the
market. The company will also hold a conference call and live audio
webcast to discuss these results that same day at 2:00 p.m. PST. Press and industry analysts are
invited to attend in listen-only mode.
Dial-in number: +1 (503) 343-6063
Participant passcode: 49870309
Replay number: +1 (404) 537-3406
Replay passcode: 49870309
Replay expiration: Wednesday, Feb. 1,
2017
Webcast site: www.quantum.com/investors
About Quantum
Quantum is a leading expert in
scale-out tiered storage, archive and data protection, providing
solutions for capturing, sharing and preserving digital assets over
the entire data lifecycle. From small businesses to major
enterprises, more than 100,000 customers have trusted Quantum to
address their most demanding data workflow challenges. Quantum's
end-to-end, tiered storage foundation enables customers to maximize
the value of their data by making it accessible whenever and
wherever needed, retaining it indefinitely and reducing total cost
and complexity. See how at www.quantum.com/customerstories.
Quantum and the Quantum logo are registered trademarks of
Quantum Corporation and its affiliates in the United States and/or other countries. All
other trademarks are the property of their respective owners.
"Safe Harbor" Statement: This press release contains
"forward-looking" statements. All statements other than statements
of historical fact are statements that could be deemed
forward-looking statements. Specifically, but without limitation,
statements relating to: i) our expected financial results for the
fiscal third quarter 2017 and for the first three quarters of
fiscal 2017; and ii) our confidence in our ability to deliver
year-over-year revenue growth again in the current quarter and
exceed our annual revenue and profitability guidance for fiscal
2017, are forward-looking statements within the meaning of the Safe
Harbor. All forward-looking statements in this press release are
based on information available to Quantum on the date hereof. These
statements involve known and unknown risks, uncertainties and other
factors that may cause Quantum's actual results to differ
materially from those implied by the forward-looking statements.
More detailed information about these risk factors are set forth in
Quantum's periodic filings with the Securities and Exchange
Commission, including, but not limited to, those risks and
uncertainties listed in the section entitled "Risk Factors," in
Quantum's Annual Report on Form 10-K filed with the Securities and
Exchange Commission on June 3, 2016
and in Quantum's Quarterly Report on Form 10-Q filed with the
Securities and Exchange Commission on November 4, 2016. Quantum expressly disclaims any
obligation to update or alter its forward-looking statements,
whether as a result of new information, future events or otherwise,
except as required by applicable law.
Use of Non-GAAP Financial Measures
Quantum believes that the non-GAAP financial measures disclosed
above provide useful and supplemental information to investors
regarding its quarterly financial performance. Quantum management
and Board of Directors use these non-GAAP financial measures
internally to understand, manage and evaluate the company's
business results and make operating decisions. For instance,
Quantum management often makes decisions regarding staffing, future
management priorities and how the company will direct future
operating expenses on the basis of non-GAAP financial measures. In
addition, compensation of our employees is based in part on the
performance of our business based on non-GAAP operating income.
The non-GAAP financial measures used in this press release
exclude the impact of the item below for the following reason:
Amortization of Intangible Assets
This includes acquired intangibles such as purchased technology in
connection with prior acquisitions. These expenses are not factored
into management's evaluation of potential acquisitions or Quantum's
performance after completion of the acquisitions because they are
not related to Quantum's core operating performance. In addition,
the frequency and amount of such charges can vary significantly
based on the size and timing of acquisitions and the maturities of
the businesses being acquired. Excluding acquisition-related
charges from non-GAAP measures provides investors with a basis to
compare Quantum against the performance of other companies without
the variability caused by purchase accounting.
Share-Based Compensation Expense
Share-based compensation expense relates primarily to equity awards
such as stock options and restricted stock units. Share-based
compensation is a non-cash expense that varies in amount from
period to period and is dependent on market forces that are often
beyond Quantum's control. Management believes that non-GAAP
measures adjusted for share-based compensation provide investors
with a basis to measure Quantum's core performance against the
performance of other companies without the variability created by
share-based compensation as a result of the variety of equity
awards used by other companies and the varying methodologies and
assumptions used.
Restructuring Charges
Restructuring charges primarily relate to expenses associated with
changes to Quantum's operating structure. Restructuring charges are
excluded from non-GAAP financial measures because they are not
considered core operating activities. Although Quantum has engaged
in various restructuring activities in the past, each has been a
discrete event based on a unique set of business objectives.
Management believes that it is appropriate to exclude restructuring
charges from Quantum's non-GAAP financial measures, as it enhances
the ability of investors to compare Quantum's period-over-period
operating results from continuing operations.
Proxy Contest and Related Costs
Proxy contest and related costs are expenses incurred to respond to
activities and inquiries of VIEX Capital Advisors, LLC, including
their proxy solicitation. These costs are not considered core
operating activities. Management believes that it is appropriate to
exclude these costs in order to provide investors the ability to
compare Quantum's period-over-period operating results from
continuing operations.
Crossroads Patent Litigation Costs
Crossroads patent litigation costs are expenses incurred to defend
ourselves and perform other activities related to a patent
infringement lawsuit filed by Crossroads Systems, Inc. These costs
are excluded from non-GAAP financial measures because they are not
considered core operating activities, and management believes that
it is appropriate to exclude these costs in order to provide
investors the ability to compare Quantum's period-over-period
operating results from continuing operations.
Loss (Gain) on Debt Extinguishment
The loss (gain) on debt extinguishment relates to specific actions
undertaken during the third quarter of fiscal 2017. The loss and
gain are excluded from non-GAAP financial measures because they are
not considered a core operating activity and management believes
that it is appropriate to exclude the loss and gain in order to
provide investors the ability to compare Quantum's
period-over-period results from continuing operations.
Non-GAAP financial measures should not be considered as a
substitute for, or superior to, measures of financial performance
prepared in accordance with GAAP. They are limited in value because
they exclude charges that have a material impact on the company's
reported financial results and, therefore, should not be relied
upon as the sole financial measures to evaluate the company. The
non-GAAP financial measures are meant to supplement, and be viewed
in conjunction with, GAAP financial measures. Investors are
encouraged to review the reconciliation of the non-GAAP financial
measures to their most directly comparable GAAP financial measures
as provided in the tables accompanying this press release.
Important Information
Quantum Corporation (the "Company"), its directors and certain
executive officers will be participants in the solicitation of
proxies from stockholders in connection with the Company's Annual
Meeting of Stockholders for the fiscal year ended March 31, 2016 (the "Annual Meeting"). The
Company has received a notice of nominations for the election of
directors from VIEX Capital Advisors, LLC in connection with the
Annual Meeting and it is possible that there may be a contested
solicitation in connection with the Annual Meeting. The Company
plans to file a proxy statement (the "Proxy Statement") with the
Securities and Exchange Commission (the "SEC") in connection with
the solicitation of proxies for the Annual Meeting.
The members of the Board of Directors of the Company and
Fuad Ahmad, Chief Financial Officer,
would be participants in the Company's solicitation of proxies in
connection with the Annual Meeting. As of December 31, 2016, the holdings of the
participants in the Company's common stock were as follows:
Robert I. Anderson – 49,277 shares;
Paul R. Auvil III – 597,509 shares;
Louis DiNardo – 292,871 shares;
Fuad Ahmad – 0 shares; Dale L. Fuller – 197,542 shares; Jon W. Gacek – 1,726,628 shares and options to
purchase 1,300,000 shares exercisable within 60 days; David A. Krall – 342,354 shares; Gregg J. Powers – 15,423,566 shares, of which
14,594,195 shares are held in managed accounts of Private Capital
Management, LLC, of which Mr. Powers is CEO and Portfolio Manager,
and as to which Mr. Powers disclaims beneficial ownership;
Clifford Press – 0 shares; and
David E. Roberson – 329,263 shares.
Additional information regarding such participants, including
updated information as to their direct or indirect interests, by
security holdings or otherwise, will be included in the Proxy
Statement and other relevant documents to be filed with the SEC in
connection with the Annual Meeting. To the extent that holdings of
the Company's securities change from the amounts reflected in the
foregoing, such changes will be reflected on Statements of Change
in Ownership on Form 4 filed with the SEC.
Promptly after filing its definitive Proxy Statement with the
SEC, the Company will mail the definitive Proxy Statement to each
stockholder entitled to vote at the Annual Meeting. STOCKHOLDERS
ARE URGED TO READ THE PROXY STATEMENT (INCLUDING ANY AMENDMENTS OR
SUPPLEMENTS THERETO) AND ANY OTHER RELEVANT DOCUMENTS THAT THE
COMPANY WILL FILE WITH THE SEC WHEN THEY BECOME AVAILABLE BECAUSE
THEY WILL CONTAIN IMPORTANT INFORMATION. Stockholders may obtain,
free of charge, the Company's preliminary proxy statement, any
amendments or supplements thereto and any other relevant documents
filed by the Company with the SEC in connection with the Annual
Meeting at the SEC's website (http://www.sec.gov). Copies of the
Company's definitive proxy statement, any amendments or supplements
thereto and any other relevant documents filed by the Company with
the SEC in connection with the Annual Meeting will also be
available, free of charge, at the Company's website
(www.quantum.com) or by writing to Investor Relations, Quantum
Corporation, 224 Airport Parkway, Suite 550, San Jose, CA 95110.
[1] All comparisons are relative to the fiscal third quarter
2016 unless otherwise noted.
[2] All references to scale-out tiered storage revenue and data
protection revenue include related service revenue.
Contact:
Brad Cohen
Public Relations
Quantum Corp.
+1 (408) 944-4044
brad.cohen@quantum.com
Brinlea Johnson or Allise
Furlani
Investor Relations
The Blueshirt Group
+1 (212) 331-8424 or +1 (212) 331-8433
brinlea@blueshirtgroup.com or allise@blueshirtgroup.com
QUANTUM
CORPORATION
|
GAAP TO NON-GAAP
RECONCILIATION
|
(In thousands,
except per share amounts)
|
(Unaudited)
|
|
|
Three Months Ended
December 31, 2016
|
|
Income
From
Operations
|
|
Net
Income
|
|
Per
Share
Net
Income,
Diluted
|
|
Low
|
|
High
|
|
Low
|
|
High
|
|
|
GAAP
|
$
|
7,500
|
–
|
|
$
|
8,500
|
|
$
|
5,500
|
–
|
|
$
|
6,500
|
|
$
|
0.02
|
Non-GAAP Reconciling
Items:
|
|
|
|
|
|
|
|
|
|
|
|
Share-based
compensation
|
1,500
|
|
|
|
1,500
|
|
|
|
|
Restructuring
benefits
|
(100)
|
|
|
|
(100)
|
|
|
|
|
Proxy contest and
related costs
|
100
|
|
|
|
100
|
|
|
|
|
Loss on debt
extinguishment
|
—
|
|
|
|
50
|
|
|
|
|
Non-GAAP
|
$
|
9,000
|
–
|
|
$
|
10,000
|
|
$
|
7,050
|
–
|
|
$
|
8,050
|
|
$
|
0.03
|
|
|
|
|
|
|
|
|
|
|
|
|
Computation of
basic and diluted net income per share:
|
GAAP
|
|
Non-GAAP
|
|
|
|
Low
|
|
|
High
|
|
Low
|
|
High
|
|
|
Net
income
|
5,500
|
–
|
|
6,500
|
|
$
|
7,050
|
–
|
|
$
|
8,050
|
|
|
Interest of dilutive
convertible notes
|
865
|
|
|
|
865
|
|
|
|
|
Gain on debt
extinguishment from dilutive convertible notes
|
(114)
|
|
|
|
—
|
|
|
|
|
Income for purposes
of computing income per diluted share
|
$
|
6,251
|
–
|
|
$
|
7,251
|
|
$
|
7,915
|
–
|
|
$
|
8,915
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted
average shares:
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
271,186
|
|
|
|
271,186
|
|
|
|
|
Dilutive shares
from stock plans
|
3,257
|
|
|
|
3,257
|
|
|
|
|
Dilutive shares
from convertible notes
|
40,859
|
|
|
|
40,859
|
|
|
|
|
Diluted
|
315,302
|
|
|
|
315,302
|
|
|
|
|
|
|
|
Three Months Ended
December 31, 2015
|
|
Income From
Operations
|
|
Net Income
(Loss)
|
|
Per Share
Net
Income
(Loss)
Diluted
|
GAAP
|
$
|
1,954
|
|
$
|
(299)
|
|
$
|
(0.00)
|
Non-GAAP Reconciling
Items:
|
|
|
|
|
Amortization of
intangibles
|
48
|
|
48
|
|
|
|
Share-based
compensation
|
2,239
|
|
2,239
|
|
|
|
Restructuring
charges
|
1,895
|
|
1,895
|
|
|
|
Crossroads patent
litigation costs
|
1,054
|
|
1,054
|
|
|
|
Loss on debt
extinguishment
|
—
|
|
394
|
|
|
|
Non-GAAP
|
$
|
7,190
|
|
$
|
5,331
|
|
$
|
0.02
|
|
|
|
|
|
|
Computation of
basic and diluted net income (loss) per share:
|
GAAP
|
|
Non-GAAP
|
|
|
Net income
(loss)
|
$
|
(299)
|
|
$
|
5,331
|
|
|
|
|
|
|
|
|
Weighted
average shares:
|
|
|
|
|
Basic
|
264,003
|
|
264,003
|
|
|
|
Dilutive shares
from stock plans
|
—
|
|
305
|
|
|
|
Diluted
|
264,003
|
|
264,308
|
|
|
|
|
The non-GAAP
financial information set forth in this table is not prepared in
accordance with generally accepted accounting principles and may be
different from non-GAAP financial information used by other
companies.
|
QUANTUM
CORPORATION
|
GAAP TO NON-GAAP
RECONCILIATION
|
(In
thousands)
|
(Unaudited)
|
|
|
Nine Months
Ended
December 31,
2016
|
|
Nine Months
Ended
December 31,
2015
|
|
Change
|
Increase in GAAP
net income for the nine months ended December 31,
2016
|
|
|
|
|
28,000
|
Non-GAAP Reconciling
Items:
|
|
|
|
|
|
Amortization of
intangibles
|
150
|
|
233
|
|
(83)
|
Share-based
compensation
|
5,100
|
|
7,339
|
|
(2,239)
|
Restructuring
charges
|
2,000
|
|
2,540
|
|
(540)
|
Proxy contest and
related costs
|
450
|
|
—
|
|
450
|
Crossroads patent
litigation costs
|
150
|
|
2,694
|
|
(2,544)
|
Loss on debt
extinguishment
|
50
|
|
394
|
|
(344)
|
Increase in
non-GAAP net income for the nine months ended December 31,
2015
|
|
|
|
|
22,700
|
|
The non-GAAP
financial information set forth in this table is not prepared in
accordance with generally accepted accounting principles and may be
different from non-GAAP financial information used by other
companies.
|
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/quantum-announces-positive-preliminary-fiscal-third-quarter-2017-results-300390039.html
SOURCE Quantum Corp.