BigBand Networks, Inc. (NASDAQ: BBND), a leader in digital video
networking, today reported financial results for the second quarter
ended June 30, 2011.
For the second quarter, total revenues were $19.8 million as
compared to $26.4 million reported in the second quarter of 2010.
GAAP net loss for the second quarter of 2011 was $8.2 million, or
($0.12) per share, compared to GAAP net loss of $9.6 million, or
($0.14) per share, reported in the second quarter of 2010.
On a non-GAAP basis, the Company reported a net loss of $5.6
million, or ($0.08) per share, in the second quarter of 2011, which
compares to a non-GAAP net loss of $5.1 million, or ($0.07) per
share, reported in the second quarter of 2010. Second quarter 2011
non-GAAP results exclude $2.6 million in stock-based compensation
expense and related income taxes. The GAAP to non-GAAP reconciling
items, for the quarters ended June 30, 2011 and 2010 can be found
in “The Reconciliations of GAAP to Non-GAAP Financial Measures”
attached to this press release.
The Company ended the second quarter of 2011 with $127.9 million
in cash, cash equivalents and marketable securities.
“In the quarter, we made good progress in our growth
initiatives, including a major win for our new MSP platform with
AT&T. This win validates the MSP’s highly-differentiated
advertising capabilities and position in IP Video and opens new
opportunities with telco and cable customers,” commented Amir
Bassan-Eskenazi, President and CEO of BigBand Networks. “Broadcast
Video, QAM and SDV (Switched Digital Video) continued to contribute
solidly to revenue in the quarter and we are pleased with the
progress we have made with our new products."
Third Quarter 2011 Business Outlook
For the third quarter of 2011, management provides the following
outlook:
- Net revenues are expected to be in the
range of $20 million to $23 million
- GAAP net loss per share is expected to
be in the range of ($0.10) to ($0.12)
- Non-GAAP net loss per share is expected
to be in the range of ($0.07) to ($0.09)
The following table shows our non-GAAP outlook for the quarter
ending September 30, 2011 reconciled to our GAAP outlook. Our
non-GAAP outlook excludes stock-based compensation charges and
related taxes.
Estimated loss per Share Low High GAAP net loss
($0.10) ($0.12) Stock-based compensation and related taxes
0.03
0.03
Non-GAAP net loss ($0.07) ($0.09)
Non-GAAP Financial Measures
BigBand reports all financial information required in accordance
with U.S. generally accepted accounting principles (GAAP), but we
believe that evaluating our ongoing operating results may be
difficult to understand if limited to reviewing only GAAP financial
measures. Many of our investors have requested that we disclose
non-GAAP information because it is useful in understanding our
performance as it excludes non-cash and other one-time charges or
benefits that many investors feel may obscure our true operating
results. Likewise, management uses non-GAAP measures to manage and
assess the profitability of our business going forward and does not
consider stock-based compensation expense or restructuring charges
and related taxes in managing our operations. Specifically,
management does not consider these expenses/benefits when
developing and monitoring our budgets and spending. The economic
substance behind our decision to exclude stock-based compensation
is that this charge is non-cash in nature. We exclude restructuring
charges as they are one-time events. As a result, we use
calculations of non-GAAP operating loss, net loss, net loss per
share and gross margin, which exclude these expenses when
evaluating our ongoing operations and allocating resources within
the organization.
As a result, our management believes it is useful, for itself
and investors, to have access to both GAAP information that
includes such charges and non-GAAP financial measures that exclude
these charges because management believes such information enables
readers of these financial results to have a better understanding
of the overall performance of our ongoing business operations in
the periods presented.
Whenever we use a non-GAAP financial measure, we provide a
reconciliation of the non-GAAP financial measure to the most
closely applicable GAAP financial measure. Investors are encouraged
to review the related GAAP financial measures and the
reconciliation of these non-GAAP financial measures to their most
directly comparable GAAP financial measure.
Conference Call Details for July 25, 2011
BigBand Networks will host a corresponding conference call and
live webcast at 2:00 p.m. Pacific Time today. To access the
conference call, dial +1-877-941-4774 for the U.S. or Canada and
+1-480-629-9760 for international callers. The webcast will be
available live on the Investor Relations section of the Company’s
corporate website at www.bigbandnet.com, and via replay beginning
approximately two hours after the completion of the call until the
Company’s announcement of its financial results for the next
quarter. An audio replay of the call will also be available to
investors beginning at approximately 4:00 p.m. Pacific Time on July
25, 2011 until 11:59 p.m. Pacific Time on August 1, 2011, by
dialing +1-800-406-7325 or +1-303-590-3030 for callers outside the
U.S. and Canada, and entering passcode 4456047#.
Cautionary Statement
The statements in this release regarding the deployment of the
MSP by AT&T validates our advertising capabilities, positions
us as leaders in IP video and opens new opportunities with
telco and cable customers, as well as our GAAP and non-GAAP
business outlook, as applicable, with respect to the quarter ending
September 30, 2011 (including revenues, stock based compensation
and net loss per share) are forward-looking statements made
pursuant to the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995. These statements involve risks and
uncertainties that could cause our actual results to differ
materially, including, but not limited to: unexpected delays in the
delivery of our solutions, changes in demand for video services,
the market acceptance of our products; the financial strengths of
our current and potential customers; the fluctuations in our gross
margins; the concentration of our customer base; competitive
developments including pricing pressures; the timing of recognition
of a significant portion of our net revenues given the complex
systems integration involved; our ability to manage operating
expenses effectively; the level of orders that are received and can
be shipped in a given quarter; and the general economic, industry
or political conditions in the United States or
internationally.
For a detailed discussion of these and other risk factors,
please refer to BigBand’s Quarterly Report on Form 10-Q for three
months ended March 31, 2011 and other reports filed with the SEC.
You can obtain copies of the reports on the SEC's Web site
(www.sec.gov).
Stockholders of BigBand Networks are cautioned not to place
undue reliance on our forward-looking statements, which speak only
as of the date such statements are made. BigBand Networks does not
undertake any obligation to publicly update any forward-looking
statements to reflect events, circumstances or new information
after this July 25, 2011 press release, or to reflect the
occurrence of unanticipated events.
About BigBand Networks
BigBand Networks, Inc. [NASDAQ: BBND] provides broadband service
providers with innovative digital video networking solutions
designed to make it easier to move, manage and monetize video.
These solutions are based on BigBand's video-networking platforms
that are built to enable efficient and reliable delivery across a
wide range of services, including digital TV, high definition TV,
advanced advertising, IPTV, video-on-demand and interactive TV.
BigBand Networks has done business with more than 200 customers in
North America, Asia and Europe -- including eight of the ten
largest cable and telco service providers in North America. BigBand
Networks is based in Redwood City, Calif., with offices worldwide.
For additional information about the company, please call
+1.650.995.5000, email info@bigbandnet.com or visit
www.bigbandnet.com.
BigBand Networks' brand and product names are service marks,
trademarks or registered trademarks of BigBand Networks, Inc. in
the United States and other countries. All other marks are the
property of their respective owners.
BigBand Networks, Inc. Condensed Consolidated Balance
Sheets (In thousands, Unaudited)
As of June
30, As of December 31, 2011
2010 ASSETS Current assets: Cash
and cash equivalents $ 19,998 $ 21,537 Marketable securities
107,905 122,012 Total cash, cash equivalents
and marketable securities 127,903 143,549 Accounts receivable, net
9,111 5,001 Inventories, net 10,874 11,117 Prepaid expenses and
other current assets 3,844 4,190 Total
current assets 151,732 163,857 Property and equipment, net
7,087 8,088 Goodwill 1,656 1,656 Other non-current assets
6,743 7,170 Total assets $ 167,218 $
180,771
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities: Accounts payable $ 6,605 $ 4,656 Accrued
compensation and related benefits 5,915 5,178 Current portion of
deferred revenues, net 19,365 18,143 Current portion of other
liabilities 3,477 4,266 Total current
liabilities 35,362 32,243 Deferred revenues, net, less
current portion 6,807 8,327 Other liabilities, less current portion
1,577 1,692 Accrued long-term Israeli severance pay 4,657 4,376
Stockholders’ equity: Common stock 71 70 Additional
paid-in-capital 304,715 299,003 Accumulated other comprehensive
income 218 253 Accumulated deficit (186,189 )
(165,193 ) Total stockholders’ equity 118,815
134,133 Total liabilities and stockholders’ equity $ 167,218
$ 180,771
BigBand Networks, Inc.
Condensed Consolidated Statements of Operations (In thousands,
except per share amounts, Unaudited)
Three Months Ended June 30, Six Months Ended June
30, 2011 2010
2011 2010 Net revenues:
Products $ 10,258 $ 16,605 $ 19,787 $ 41,486 Services 9,520
9,788 18,356 17,142
Total net revenues 19,778 26,393 38,143 58,628 Cost
of net revenues: Products 6,181 9,402 11,947 23,326 Services
2,792 3,032 5,835 6,309
Total cost of net revenues 8,973 12,434
17,782 29,635 Gross profit
10,805 13,959 20,361
28,993 Operating expenses: Research and
development 10,677 13,110 22,060 26,602 Sales and marketing 4,973
5,998 10,085 12,048 General and administrative 3,367 4,010 7,181
8,536 Restructuring charges - 1,039
2,007 1,039 Total operating expenses
19,017 24,157 41,333
48,225 Operating loss (8,212 ) (10,198 )
(20,972 ) (19,232 ) Interest income 218 337 424 852 Other income
(expense), net 22 (95 ) (8 )
(183 ) Loss before provision for (benefit from) income taxes (7,972
) (9,956 ) (20,556 ) (18,563 ) Provision for (benefit from) income
taxes 222 (315 ) 440 (153
) Net loss $ (8,194 ) $ (9,641 ) $ (20,996 ) $ (18,410 )
Basic net loss per common share $ (0.12 ) $ (0.14 ) $ (0.30 ) $
(0.27 ) Diluted net loss per common share $ (0.12 ) $ (0.14 ) $
(0.30 ) $ (0.27 ) Shares used in GAAP basic net loss per
common share 70,312 68,018
70,079 67,667 Shares used in GAAP diluted net
loss per common share 70,312 68,018
70,079 67,667
BigBand
Networks, Inc. Reconciliation of GAAP to Non-GAAP Financial
Measures (In thousands, except per share amounts, Unaudited)
Three Months Ended June 30, 2011
GAAP Results
Stock-basedCompensation
and Income Taxes
Non-GAAP Results Net revenues: Products
$ 10,258 $ - $ 10,258 Services 9,520 -
9,520 Total net revenues 19,778
- 19,778 Cost of net revenues: Products
6,181 (265 ) 5,916 Services 2,792 (220 )
2,572 Total cost of net revenues 8,973
(485 ) 8,488 Gross profit 10,805
485 11,290 Operating expenses:
Research and development 10,677 (1,100 ) 9,577 Sales and marketing
4,973 (346 ) 4,627 General and administrative 3,367
(608 ) 2,759 Total operating expenses
19,017 (2,054 ) 16,963 Operating
loss (8,212 ) 2,539 (5,673 ) Interest income 218 - 218 Other income
22 - 22 Loss before
provision for income taxes (7,972 ) 2,539 (5,433 ) Provision for
income taxes 222 (52 ) 170 Net
loss $ (8,194 ) $ 2,591 $ (5,603 ) Basic net loss per
common share $ (0.12 ) $ (0.08 ) Diluted net loss per common share
$ (0.12 ) $ (0.08 ) Shares used in basic net loss per common
share 70,312 70,312 Shares used in
diluted net loss per common share 70,312
70,312
BigBand Networks, Inc. Reconciliation
of GAAP to Non-GAAP Financial Measures (In thousands, except per
share amounts, Unaudited)
Six Months Ended June 30, 2011 GAAP Results
Stock-basedCompensation
and Income Taxes
Restructuringcharges
Non-GAAP Results Net revenues: Products
$ 19,787 $ - $ - $ 19,787 Services 18,356 -
- 18,356 Total net revenues
38,143 - - 38,143
Cost of net revenues: Products 11,947 (462 ) - 11,485
Services 5,835 (439 ) -
5,396 Total cost of net revenues 17,782
(901 ) - 16,881 Gross profit
20,361 901 - 21,262
Operating expenses: Research and development 22,060
(2,205 ) - 19,855 Sales and marketing 10,085 (714 ) - 9,371 General
and administrative 7,181 (1,407 ) - 5,774 Restructuring charges
2,007 - (2,007 ) -
Total operating expenses 41,333 (4,326 )
(2,007 ) 35,000 Operating loss (20,972
) 5,227 2,007 (13,738 ) Interest income 424 - - 424 Other expense
(8 ) - - (8 ) Loss before
provision for income taxes (20,556 ) 5,227 2,007 (13,322 )
Provision for income taxes 440 (144 ) -
296 Net loss $ (20,996 ) $ 5,371 $
2,007 $ (13,618 ) Basic net loss per common share $
(0.30 ) $ (0.19 ) Diluted net loss per common share $ (0.30 ) $
(0.19 ) Shares used in basic net loss per common share
70,079 70,079 Shares used in diluted
net loss per common share 70,079 70,079
BigBand Networks, Inc.
Reconciliation of GAAP to Non-GAAP Financial Measures (In
thousands, except per share amounts and percentages, Unaudited)
Three Months Ended June 30, Six Months Ended June
30, 2011 2010
2011 2010 GAAP and
Non-GAAP net revenues as reported $ 19,778 $ 26,393 $
38,143 $ 58,628 GAAP cost of net revenues as
reported $ 8,973 $ 12,434 $ 17,782 $ 29,635 Stock-based
compensation expense (485 ) (610 ) (901 )
(1,176 ) Non-GAAP cost of net revenues $ 8,488 $
11,824 $ 16,881 $ 28,459 GAAP gross
profit as reported $ 10,805 $ 13,959 $ 20,361 $ 28,993 Stock-based
compensation expense 485 610 901
1,176 Non-GAAP gross profit $ 11,290 $
14,569 $ 21,262 $ 30,169 As a
percentage of net revenues: GAAP gross profit as reported
54.6 % 52.9 % 53.4 % 49.5 % Non-GAAP gross
profit 57.1 % 55.2 % 55.7 % 51.5 %
GAAP operating loss as reported $ (8,212 ) $ (10,198 ) $
(20,972 ) $ (19,232 ) Stock-based compensation expense: - Cost of
net revenues 485 610 901 1,176 - Research and development 1,100
1,365 2,205 2,687 - Sales and marketing 346 642 714 1,311 - General
and administrative 608 1,008 1,407 2,209 Restructuring charges
- 1,039 2,007
1,039 Non-GAAP operating loss $ (5,673 ) $ (5,534 ) $
(13,738 ) $ (10,810 ) GAAP net loss as reported $ (8,194 ) $
(9,641 ) $ (20,996 ) $ (18,410 ) Stock-based compensation expense
2,539 3,625 5,227 7,383 Restructuring charges - 1,039 2,007 1,039
Tax benefits (provision) 52 (104 ) 144
(125 ) Non-GAAP net loss $ (5,603 ) $ (5,081 ) $
(13,618 ) $ (10,113 ) Basic Non-GAAP net loss per common
share $ (0.08 ) $ (0.07 ) $ (0.19 ) $ (0.15 ) Diluted Non-GAAP net
loss per common share $ (0.08 ) $ (0.07 ) $ (0.19 ) $ (0.15 )
Shares used in Basic Non-GAAP net loss per common share
70,312 68,018 70,079
67,667 Shares used in Diluted Non-GAAP net
loss per common share 70,312 68,018
70,079 67,667
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