Infinera Corporation (NASDAQ: INFN) today released financial
results for its fourth quarter and fiscal year ended December 26,
2020.
GAAP revenue for the quarter was $353.5 million compared to
$340.2 million in the third quarter of 2020 and $384.6 million in
the fourth quarter of 2019.
GAAP gross margin for the quarter was 35.7% compared to 31.8% in
the third quarter of 2020 and 29.0% in the fourth quarter of 2019.
GAAP operating margin for the quarter was (1.9)% compared to (7.9)%
in the third quarter of 2020 and (15.8)% in the fourth quarter of
2019.
GAAP net loss for the quarter was $(9.9) million, or $(0.05) per
share, compared to $(35.9) million, or $(0.19) per share, in the
third quarter of 2020, and $(66.6) million, or $(0.37) per share,
in the fourth quarter of 2019.
Non-GAAP revenue for the quarter was $354.4 million compared to
$341.2 million in the third quarter of 2020 and $386.5 million in
the fourth quarter of 2019.
Non-GAAP gross margin for the quarter was 37.6% compared to
35.2% in the third quarter of 2020 and 35.2% in the fourth quarter
of 2019. Non-GAAP operating margin for the quarter was 6.6%
compared to 2.2% in the third quarter of 2020 and 2.3% in the
fourth quarter of 2019.
Non-GAAP net income for the quarter was $26.3 million, or $0.13
per share, compared to a net income of $4.2 million, or $0.02 per
share, in the third quarter of 2020, and $6.4 million, or $0.03 per
share, in the fourth quarter of 2019.
GAAP revenue for the year was $1,355.6 million compared to
$1,298.9 million in 2019. GAAP gross margin for the year was 30.2%
compared to 25.1% in 2019. GAAP operating margin for the year was
(11.4)% compared to (27.0)% in 2019. GAAP net loss for the year was
$(206.7) million, or $(1.10) per share, compared to $(386.6)
million, or $(2.16) per share, in 2019.
Non-GAAP revenue for the year was $1,359.7 million compared to
$1,316.6 million in 2019. Non-GAAP gross margin for the year was
33.8% compared to 33.6% in 2019. Non-GAAP operating margin for the
year was (0.5)% compared to (6.3)% in 2019. Non-GAAP net loss for
the year was $(36.1) million, or $(0.19) per share, compared to
$(107.3) million, or $(0.60) per share, in 2019.
A further explanation of the use of non-GAAP financial
information and a reconciliation of each of the non-GAAP financial
measures to the most directly comparable GAAP financial measure can
be found at the end of this press release.
“We ended the year with another quarter of strong performance
marked by solid execution across the board. Fourth quarter non-GAAP
revenue was in line with our outlook, with non-GAAP gross margin
and non-GAAP operating margin coming in above the guidance range.
Further, we generated free cash flow in the quarter,” said David
Heard, Infinera CEO. “I am encouraged by the financial progress,
operational improvements, and technology innovation delivered by
the Infinera team in 2020. We believe our team’s focused execution
in 2020 positions us well towards achieving our target business
model.”
Financial Outlook
Infinera's outlook for the quarter ending March 27, 2021 is as
follows:
- GAAP revenue is expected to be $329
million +/- $10 million. Non-GAAP revenue is expected to be $330
million +/- $10 million.
- GAAP gross margin is expected to be
32.5% +/- 150 bps. Non-GAAP gross margin is expected to be 35.5%
+/- 150 bps.
- GAAP operating expenses are expected to
be $144 million +/- $2.0 million. Non-GAAP operating
expenses are expected to be $123 million +/- $2.0
million.
- GAAP operating margin is expected to be
(11.5)% +/- 200 bps. Non-GAAP operating margin is expected to be
(2.0)% +/- 200 bps.
Fourth Quarter 2020 Investor Slides Available
Online
Investor slides reviewing Infinera's fourth quarter of 2020
financial results will be furnished to the Securities and Exchange
Commission (SEC) on a Current Report on Form 8-K and published on
Infinera's Investor Relations website at investors.infinera.com
prior to the fourth quarter of 2020 earnings conference call.
Analysts and investors are encouraged to review these slides prior
to participating in the conference call webcast.
Conference Call Information
Infinera will host a conference call for analysts and investors
to discuss its results for the fourth quarter of 2020 and its
outlook for the first quarter of 2021 today at 5:00 p.m. Eastern
Time (2:00 p.m. Pacific Time). Interested parties may join the
conference call by dialing 1-866-373-6878 (toll free) or
1-412-317-5101 (international). A live webcast of the conference
call will also be accessible from the Events section of Infinera’s
website at investors.infinera.com. Replay of the audio webcast will
be available at investors.infinera.com approximately two hours
after the end of the live call.
Contacts:
Media:Anna VueTel. +1 (916) 595-8157avue@infinera.com
Investors:Amitabh Passi, Head of Investor
Relationsapassi@infinera.com
Michael Bowen, ICR, Inc.Tel. +1 (203)
682-8299Michael.Bowen@icrinc.com
Marc P. Griffin, ICR, Inc.Tel. +1 (646)
277-1290Marc.Griffin@icrinc.com
About Infinera
Infinera is a global supplier of innovative networking solutions
that enable carriers, cloud operators, governments, and enterprises
to scale network bandwidth, accelerate service innovation, and
automate network operations. The Infinera end-to-end packet-optical
portfolio delivers industry-leading economics and performance in
long-haul, submarine, data center interconnect, and metro transport
applications. To learn more about Infinera, visit www.infinera.com,
follow us on Twitter @Infinera, and read Infinera's latest blog
posts at www.infinera.com/blog.
Forward-Looking Statements
This press release contains certain forward-looking statements
within the meaning of Section 27A of the Securities Act of 1933 and
Section 21E of the Securities Exchange Act of 1934. Forward-looking
statements generally relate to future events or Infinera's future
financial or operating performance. In some cases, you can identify
forward-looking statements because they contain words such as
"anticipate," "believe," "could," "estimate," "expect," "intend,"
"may," "should," "will," and "would" or the negative of these words
or similar terms or expressions that concern Infinera's
expectations, strategy, priorities, plans or intentions. Such
forward-looking statements in this press release include, without
limitation, Infinera's positioning for achievement of its target
business model and Infinera's financial outlook for the first
quarter of 2021. These forward-looking statements are based on
estimates and information available to Infinera as of the date
hereof and are not guarantees of future performance; actual results
could differ materially from those stated or implied due to risks
and uncertainties. The risks and uncertainties that could cause
Infinera’s results to differ materially from those expressed or
implied by such forward-looking statements include the effect of
the COVID-19 pandemic on Infinera’s business, results of
operations, financial condition, stock price and personnel; the
effect of global and regional economic conditions on Infinera’s
business, including effects on purchasing decisions by customers;
Infinera’s future capital needs and its ability to generate the
cash flow or otherwise secure the capital necessary to make
anticipated capital expenditures; Infinera's ability to service its
debt obligations and pursue its strategic plan; delays in the
development and introduction of new products or updates to existing
products; market acceptance of Infinera’s end-to-end portfolio;
Infinera's reliance on single and limited source suppliers;
fluctuations in demand, sales cycles and prices for products and
services, including discounts given in response to competitive
pricing pressures, as well as the timing of purchases by Infinera's
key customers; the effect that changes in product pricing or mix,
and/or increases in component costs, could have on Infinera’s gross
margin; Infinera’s ability to respond to rapid technological
changes; aggressive business tactics by Infinera’s competitors; the
effects of customer consolidation; our ability to identify, attract
and retain qualified personnel; the impacts of foreign currency
fluctuations; Infinera’s ability to protect its intellectual
property; claims by others that Infinera infringes their
intellectual property; impacts of the recent presidential
administration change in the United States; war, terrorism, public
health issues, natural disasters and other circumstances that could
disrupt the supply, delivery or demand of Infinera's products; and
other risks and uncertainties detailed in Infinera’s SEC filings
from time to time. More information on potential factors that may
impact Infinera’s business are set forth in Infinera's periodic
reports filed with the SEC, including its Annual Report on Form
10-K for the year ended on December 28, 2019 as filed with the SEC
on March 4, 2020, and its Quarterly Report on Form 10-Q for the
quarter ended September 26, 2020 as filed with the SEC on November
5, 2020, as well as subsequent reports filed with or furnished to
the SEC from time to time. These reports are available on
Infinera’s website at www.infinera.com and the SEC’s website at
www.sec.gov. Infinera assumes no obligation to, and does not
currently intend to, update any such forward-looking
statements.
Use of Non-GAAP Financial Information
In addition to disclosing financial measures prepared in
accordance with U.S. Generally Accepted Accounting Principles
(GAAP), this press release and the accompanying tables contain
certain non-GAAP financial measures, including measures that
exclude acquisition-related deferred revenue, other customer
related charges, stock-based compensation expenses, amortization of
acquired intangible assets, acquisition and integration costs,
acquisition-related inventory adjustments, restructuring and
related costs, COVID-19 related costs, litigation charges,
amortization of debt discount on Infinera’s convertible senior
notes, gain/loss on non-marketable equity investments, and income
tax effects. For a description of these non-GAAP financial measures
and a reconciliation to the most directly comparable GAAP financial
measures, please see the section titled “GAAP to Non-GAAP
Reconciliations” below.
Infinera has included forward-looking non-GAAP information in
this press release, including an estimate of certain non-GAAP
financial measures for the first quarter of 2021 that exclude
acquisition-related deferred revenue adjustments, stock-based
compensation expenses, amortization of acquired intangible assets,
acquisition and integration costs related to Infinera's acquisition
of Coriant, and restructuring and related expenses. Please see the
section titled “GAAP to Non-GAAP Reconciliation of Financial
Outlook” below on specific adjustments.
Infinera believes these adjustments are appropriate to enhance
an overall understanding of its underlying financial performance
and also its prospects for the future and are considered by
management for the purpose of making operational decisions. In
addition, these results are the primary indicators management uses
as a basis for its planning and forecasting of future periods. The
presentation of this additional information is not meant to be
considered in isolation or as a substitute for revenue, gross
margin, operating expenses, operating margin, and net income (loss)
prepared in accordance with GAAP. Non-GAAP financial measures are
not based on a comprehensive set of accounting rules or principles
and are subject to limitations.
A copy of this press release can be found on the Investor
Relations page of Infinera’s website at investors.infinera.com.
Infinera and the Infinera logo are trademarks or registered
trademarks of Infinera Corporation. All other trademarks used or
mentioned herein belong to their respective owners.
Infinera CorporationCondensed
Consolidated Statements of Operations(In
thousands, except per share
data)(Unaudited)
| |
|
|
|
| |
Three Months Ended |
|
Twelve Months Ended |
| |
December 26,2020 |
|
December 28,2019 |
|
December 26,2020 |
|
December 28,2019 |
| Revenue: |
|
|
|
|
|
|
|
|
Product |
$ |
267,226 |
|
|
|
$ |
307,861 |
|
|
|
$ |
1,045,551 |
|
|
|
$ |
1,011,488 |
|
|
|
Services |
86,299 |
|
|
|
76,706 |
|
|
|
310,045 |
|
|
|
287,377 |
|
|
|
Total revenue |
353,525 |
|
|
|
384,567 |
|
|
|
1,355,596 |
|
|
|
1,298,865 |
|
|
| Cost of revenue: |
|
|
|
|
|
|
|
|
Cost of product |
178,153 |
|
|
|
213,536 |
|
|
|
751,465 |
|
|
|
735,059 |
|
|
|
Cost of services |
44,724 |
|
|
|
38,543 |
|
|
|
160,118 |
|
|
|
146,916 |
|
|
|
Amortization of intangible assets |
4,611 |
|
|
|
8,437 |
|
|
|
29,247 |
|
|
|
32,583 |
|
|
|
Acquisition and integration costs |
— |
|
|
|
7,238 |
|
|
|
1,828 |
|
|
|
28,449 |
|
|
|
Restructuring and related |
(106 |
) |
|
|
5,407 |
|
|
|
4,146 |
|
|
|
29,935 |
|
|
|
Total cost of revenue |
227,382 |
|
|
|
273,161 |
|
|
|
946,804 |
|
|
|
972,942 |
|
|
| Gross profit |
126,143 |
|
|
|
111,406 |
|
|
|
408,792 |
|
|
|
325,923 |
|
|
| Operating expenses: |
|
|
|
|
|
|
|
|
Research and development |
64,728 |
|
|
|
68,632 |
|
|
|
265,634 |
|
|
|
287,977 |
|
|
|
Sales and marketing |
32,145 |
|
|
|
37,979 |
|
|
|
129,604 |
|
|
|
151,423 |
|
|
|
General and administrative |
24,336 |
|
|
|
30,014 |
|
|
|
112,240 |
|
|
|
126,351 |
|
|
|
Amortization of intangible assets |
4,745 |
|
|
|
6,617 |
|
|
|
18,581 |
|
|
|
27,280 |
|
|
|
Acquisition and integration costs |
(265 |
) |
|
|
11,011 |
|
|
|
13,346 |
|
|
|
42,271 |
|
|
|
Restructuring and related |
7,230 |
|
|
|
18,024 |
|
|
|
24,586 |
|
|
|
40,851 |
|
|
|
Total operating expenses |
132,919 |
|
|
|
172,277 |
|
|
|
563,991 |
|
|
|
676,153 |
|
|
| Loss from operations |
(6,776 |
) |
|
|
(60,871 |
) |
|
|
(155,199 |
) |
|
|
(350,230 |
) |
|
| Other income (expense), net: |
|
|
|
|
|
|
|
|
Interest income |
33 |
|
|
|
59 |
|
|
|
118 |
|
|
|
1,139 |
|
|
|
Interest expense |
(12,853 |
) |
|
|
(8,946 |
) |
|
|
(46,728 |
) |
|
|
(31,657 |
) |
|
|
Other income (loss), net |
10,777 |
|
|
|
3,001 |
|
|
|
1,121 |
|
|
|
(2,907 |
) |
|
|
Total other income (expense), net |
(2,043 |
) |
|
|
(5,886 |
) |
|
|
(45,489 |
) |
|
|
(33,425 |
) |
|
| Loss before income taxes |
(8,819 |
) |
|
|
(66,757 |
) |
|
|
(200,688 |
) |
|
|
(383,655 |
) |
|
| Provision for/(benefit from)
income taxes |
1,105 |
|
|
|
(163 |
) |
|
|
6,035 |
|
|
|
2,963 |
|
|
| Net loss |
$ |
(9,924 |
) |
|
|
$ |
(66,594 |
) |
|
|
$ |
(206,723 |
) |
|
|
$ |
(386,618 |
) |
|
| Net loss per common share: |
|
|
|
|
|
|
|
|
Basic |
$ |
(0.05 |
) |
|
|
$ |
(0.37 |
) |
|
|
$ |
(1.10 |
) |
|
|
$ |
(2.16 |
) |
|
|
Diluted |
$ |
(0.05 |
) |
|
|
$ |
(0.37 |
) |
|
|
$ |
(1.10 |
) |
|
|
$ |
(2.16 |
) |
|
| Weighted average shares used in
computing net loss per common share: |
|
|
|
|
|
|
|
|
Basic |
195,655 |
|
|
|
180,864 |
|
|
|
188,216 |
|
|
|
178,984 |
|
|
|
Diluted |
195,655 |
|
|
|
180,864 |
|
|
|
188,216 |
|
|
|
178,984 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Infinera CorporationGAAP to Non-GAAP
Reconciliations(In thousands, except percentages
and per share data)(Unaudited)
| |
|
|
|
| |
Three Months Ended |
|
Twelve Months Ended |
| |
December26, 2020 |
|
|
|
September26, 2020 |
|
|
|
December28, 2019 |
|
|
|
December26, 2020 |
|
|
|
December28, 2019 |
|
|
| Reconciliation of
Revenue: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| U.S. GAAP as reported |
$ |
353,525 |
|
|
|
|
|
$ |
340,211 |
|
|
|
|
|
$ |
384,567 |
|
|
|
|
|
$ |
1,355,596 |
|
|
|
|
|
$ |
1,298,865 |
|
|
|
|
| Acquisition-related deferred
revenue adjustment(1) |
892 |
|
|
|
|
|
1,037 |
|
|
|
|
|
1,891 |
|
|
|
|
|
4,089 |
|
|
|
|
|
9,631 |
|
|
|
|
| Other customer related
charges(2) |
— |
|
|
|
|
|
— |
|
|
|
|
|
— |
|
|
|
|
|
— |
|
|
|
|
|
8,100 |
|
|
|
|
| Non-GAAP as adjusted |
$ |
354,417 |
|
|
|
|
|
$ |
341,248 |
|
|
|
|
|
$ |
386,458 |
|
|
|
|
|
$ |
1,359,685 |
|
|
|
|
|
$ |
1,316,596 |
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Reconciliation of
Gross Profit: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
U.S. GAAP as reported |
$ |
126,143 |
|
|
|
35.7 |
% |
|
$ |
108,276 |
|
|
|
31.8 |
% |
|
$ |
111,406 |
|
|
|
29.0 |
% |
|
$ |
408,792 |
|
|
|
30.2 |
% |
|
$ |
325,923 |
|
|
|
25.1 |
% |
| Acquisition-related deferred
revenue adjustment(1) |
892 |
|
|
|
|
|
1,037 |
|
|
|
|
|
1,891 |
|
|
|
|
|
4,089 |
|
|
|
|
|
9,631 |
|
|
|
|
| Other customer related
charges(2) |
— |
|
|
|
|
|
— |
|
|
|
|
|
— |
|
|
|
|
|
— |
|
|
|
|
|
8,100 |
|
|
|
|
| Stock-based
compensation(3) |
1,742 |
|
|
|
|
|
1,878 |
|
|
|
|
|
1,752 |
|
|
|
|
|
7,785 |
|
|
|
|
|
6,449 |
|
|
|
|
| Amortization of acquired
intangible assets(4) |
4,611 |
|
|
|
|
|
7,287 |
|
|
|
|
|
8,437 |
|
|
|
|
|
29,247 |
|
|
|
|
|
32,583 |
|
|
|
|
| Acquisition and integration
costs(5) |
— |
|
|
|
|
|
43 |
|
|
|
|
|
7,238 |
|
|
|
|
|
1,828 |
|
|
|
|
|
28,449 |
|
|
|
|
| Acquisition-related inventory
adjustments(6) |
— |
|
|
|
|
|
— |
|
|
|
|
|
— |
|
|
|
|
|
— |
|
|
|
|
|
1,778 |
|
|
|
|
| Restructuring and
related(7) |
(106 |
) |
|
|
|
|
1,504 |
|
|
|
|
|
5,407 |
|
|
|
|
|
4,146 |
|
|
|
|
|
29,935 |
|
|
|
|
| COVID-19 related costs(8) |
— |
|
|
|
|
|
— |
|
|
|
|
|
— |
|
|
|
|
|
3,641 |
|
|
|
|
|
— |
|
|
|
|
| Non-GAAP as adjusted |
$ |
133,282 |
|
|
|
37.6 |
% |
|
$ |
120,025 |
|
|
|
35.2 |
% |
|
$ |
136,131 |
|
|
|
35.2 |
% |
|
$ |
459,528 |
|
|
|
33.8 |
% |
|
$ |
442,848 |
|
|
|
33.6 |
% |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Reconciliation of
Operating Expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| U.S. GAAP as reported |
$ |
132,919 |
|
|
|
|
|
$ |
135,193 |
|
|
|
|
|
$ |
172,277 |
|
|
|
|
|
563,991 |
|
|
|
|
|
$ |
676,153 |
|
|
|
|
| Stock-based
compensation(3) |
11,177 |
|
|
|
|
|
10,185 |
|
|
|
|
|
9,321 |
|
|
|
|
|
41,676 |
|
|
|
|
|
36,330 |
|
|
|
|
| Amortization of acquired
intangible assets(4) |
4,745 |
|
|
|
|
|
4,696 |
|
|
|
|
|
6,617 |
|
|
|
|
|
18,581 |
|
|
|
|
|
27,280 |
|
|
|
|
| Acquisition and integration
costs(5) |
(265 |
) |
|
|
|
|
1,045 |
|
|
|
|
|
11,011 |
|
|
|
|
|
13,346 |
|
|
|
|
|
42,271 |
|
|
|
|
| Restructuring and
related(7) |
7,230 |
|
|
|
|
|
6,679 |
|
|
|
|
|
18,024 |
|
|
|
|
|
24,586 |
|
|
|
|
|
40,851 |
|
|
|
|
| Litigation charges(9) |
— |
|
|
|
|
|
— |
|
|
|
|
|
— |
|
|
|
|
|
— |
|
|
|
|
|
4,100 |
|
|
|
|
| Non-GAAP as adjusted |
$ |
110,032 |
|
|
|
|
|
$ |
112,588 |
|
|
|
|
|
$ |
127,304 |
|
|
|
|
|
$ |
465,802 |
|
|
|
|
|
$ |
525,321 |
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Reconciliation of
Income/(Loss) from Operations: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| U.S. GAAP as reported |
$ |
(6,776 |
) |
|
|
(1.9 |
)% |
|
$ |
(26,917 |
) |
|
|
(7.9 |
)% |
|
$ |
(60,871 |
) |
|
|
(15.8 |
)% |
|
$ |
(155,199 |
) |
|
|
(11.4 |
)% |
|
$ |
(350,230 |
) |
|
|
(27.0 |
)% |
| Acquisition-related deferred
revenue adjustment(1) |
892 |
|
|
|
|
|
1,037 |
|
|
|
|
|
1,891 |
|
|
|
|
|
4,089 |
|
|
|
|
|
9,631 |
|
|
|
|
| Other customer related
charges(2) |
— |
|
|
|
|
|
— |
|
|
|
|
|
— |
|
|
|
|
|
— |
|
|
|
|
|
8,100 |
|
|
|
|
| Stock-based
compensation(3) |
12,919 |
|
|
|
|
|
12,063 |
|
|
|
|
|
11,073 |
|
|
|
|
|
49,461 |
|
|
|
|
|
42,779 |
|
|
|
|
| Amortization of acquired
intangible assets(4) |
9,356 |
|
|
|
|
|
11,983 |
|
|
|
|
|
15,054 |
|
|
|
|
|
47,828 |
|
|
|
|
|
59,863 |
|
|
|
|
| Acquisition and integration
costs(5) |
(265 |
) |
|
|
|
|
1,088 |
|
|
|
|
|
18,249 |
|
|
|
|
|
15,174 |
|
|
|
|
|
70,720 |
|
|
|
|
| Acquisition-related inventory
adjustments(6) |
— |
|
|
|
|
|
— |
|
|
|
|
|
— |
|
|
|
|
|
— |
|
|
|
|
|
1,778 |
|
|
|
|
| Restructuring and
related(7) |
7,124 |
|
|
|
|
|
8,183 |
|
|
|
|
|
23,431 |
|
|
|
|
|
28,732 |
|
|
|
|
|
70,786 |
|
|
|
|
| COVID-19 related costs(8) |
— |
|
|
|
|
|
— |
|
|
|
|
|
— |
|
|
|
|
|
3,641 |
|
|
|
|
|
— |
|
|
|
|
| Litigation charges(9) |
— |
|
|
|
|
|
— |
|
|
|
|
|
— |
|
|
|
|
|
— |
|
|
|
|
|
4,100 |
|
|
|
|
| Non-GAAP as adjusted |
$ |
23,250 |
|
|
|
6.6 |
% |
|
$ |
7,437 |
|
|
|
2.2 |
% |
|
$ |
8,827 |
|
|
|
2.3 |
% |
|
$ |
(6,274 |
) |
|
|
(0.5 |
)% |
|
$ |
(82,473 |
) |
|
|
(6.3 |
)% |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
|
|
| |
Three Months Ended |
|
Twelve Months Ended |
| |
December26, 2020 |
|
September26, 2020 |
|
December28, 2019 |
|
December26, 2020 |
|
December28, 2019 |
| Reconciliation of Net
Income/ (Loss): |
|
|
|
|
|
|
|
|
|
| U.S. GAAP as reported |
$ |
(9,924 |
) |
|
|
$ |
(35,896 |
) |
|
|
$ |
(66,594 |
) |
|
|
$ |
(206,723 |
) |
|
|
(386,618 |
) |
|
| Acquisition-related deferred
revenue adjustment(1) |
892 |
|
|
|
1,037 |
|
|
|
1,891 |
|
|
|
4,089 |
|
|
|
9,631 |
|
|
| Other customer related
charges(2) |
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
8,100 |
|
|
| Stock-based
compensation(3) |
12,919 |
|
|
|
12,063 |
|
|
|
11,073 |
|
|
|
49,461 |
|
|
|
42,779 |
|
|
| Amortization of acquired
intangible assets(4) |
9,356 |
|
|
|
11,983 |
|
|
|
15,054 |
|
|
|
47,828 |
|
|
|
59,863 |
|
|
| Acquisition and integration
costs(5) |
(265 |
) |
|
|
1,088 |
|
|
|
18,249 |
|
|
|
15,174 |
|
|
|
70,720 |
|
|
| Acquisition-related inventory
adjustments(6) |
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
1,778 |
|
|
| Restructuring and
related(7) |
7,124 |
|
|
|
8,183 |
|
|
|
23,431 |
|
|
|
28,732 |
|
|
|
70,786 |
|
|
| COVID-19 related costs(8) |
— |
|
|
|
— |
|
|
|
— |
|
|
|
3,641 |
|
|
|
— |
|
|
| Litigation charges(9) |
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
4,100 |
|
|
| Amortization of debt
discount(10) |
6,910 |
|
|
|
6,741 |
|
|
|
4,567 |
|
|
|
25,349 |
|
|
|
17,612 |
|
|
| Gain/Loss on non-marketable
equity investment(11) |
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(1,009 |
) |
|
| Income tax effects(12) |
(691 |
) |
|
|
(991 |
) |
|
|
(1,268 |
) |
|
|
(3,688 |
) |
|
|
(5,037 |
) |
|
|
Non-GAAP as adjusted |
$ |
26,321 |
|
|
|
$ |
4,208 |
|
|
|
$ |
6,403 |
|
|
|
$ |
(36,137 |
) |
|
|
$ |
(107,295 |
) |
|
| |
|
|
|
|
|
|
|
|
|
| Net Income/(Loss) per
Common Share - Basic and Diluted: |
|
|
|
|
|
|
|
|
|
| U.S. GAAP as reported |
$ |
(0.05 |
) |
|
|
$ |
(0.19 |
) |
|
|
$ |
(0.37 |
) |
|
|
$ |
(1.10 |
) |
|
|
$ |
(2.16 |
) |
|
| Non-GAAP as adjusted(13) |
$ |
0.13 |
|
|
|
$ |
0.02 |
|
|
|
$ |
0.03 |
|
|
|
$ |
(0.19 |
) |
|
|
$ |
(0.60 |
) |
|
| |
|
|
|
|
|
|
|
|
|
| Weighted Average Shares Used in
Computing Net Loss per Common Share - Basic and Diluted: |
|
|
|
|
|
|
|
|
|
| Basic |
195,655 |
|
|
|
189,589 |
|
|
|
180,864 |
|
|
|
188,216 |
|
|
|
178,984 |
|
|
| Diluted(14) |
203,259 |
|
|
|
195,868 |
|
|
|
186,349 |
|
|
|
188,216 |
|
|
|
178,984 |
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
Business combination accounting principles require Infinera to
write down to fair value its maintenance support contracts assumed
in Infinera's acquisition of Coriant, which closed during the
fourth quarter of 2018. The revenue for these support contracts is
deferred and typically recognized over a period of time after the
Coriant acquisition, so Infinera's GAAP revenue for a period of
time after the acquisition will not reflect the full amount of
revenue that would have been reported if the acquired deferred
revenue was not written down to fair value. The non-GAAP adjustment
eliminates the effect of the deferred revenue write-down.
Management believes these adjustments to revenue from support
contracts assumed in the Coriant acquisition are useful to
investors as an additional means to reflect revenue trends in
Infinera's business. |
| |
|
| (2) |
Other customer-related charges
include one-time benefits and charges that are not directly related
to Infinera’s ongoing or core business results. During the second
quarter of 2019, Infinera agreed to reimburse a customer for
certain expenses incurred by them in connection with a network
service outage that occurred during the fourth quarter of fiscal
2018. Management has excluded the impact of this charge in arriving
at Infinera's non-GAAP results because it is non-recurring, and
management believes that this reimbursement is not indicative of
ongoing operating performance. |
| |
|
| (3) |
Stock-based compensation expense
is calculated in accordance with the fair value recognition
provisions of Financial Accounting Standards Board Accounting
Standards Codification Topic 718, Compensation – Stock Compensation
effective January 1, 2006. The following table summarizes the
effects of stock-based compensation related to employees and
non-employees (in thousands): |
| |
|
|
|
|
| |
|
Three Months Ended |
|
Twelve Months Ended |
| |
|
December26, 2020 |
|
September26, 2020 |
|
December28, 2019 |
|
December26, 2020 |
|
December28, 2019 |
|
Cost of revenue |
|
$ |
1,742 |
|
|
$ |
1,878 |
|
|
$ |
1,752 |
|
|
$ |
7,785 |
|
|
$ |
6,449 |
|
|
Total Cost of revenue |
|
1,742 |
|
|
1,878 |
|
|
1,752 |
|
|
7,785 |
|
|
6,449 |
|
| Research and development |
|
4,501 |
|
|
4,209 |
|
|
3,574 |
|
|
16,863 |
|
|
17,457 |
|
| Sales and marketing |
|
2,771 |
|
|
2,706 |
|
|
2,578 |
|
|
10,907 |
|
|
8,413 |
|
| General and
administration |
|
3,905 |
|
|
3,270 |
|
|
3,169 |
|
|
13,906 |
|
|
10,460 |
|
|
Total Operating expenses |
|
$ |
11,177 |
|
|
$ |
10,185 |
|
|
$ |
9,321 |
|
|
$ |
41,676 |
|
|
$ |
36,330 |
|
|
Total stock-based compensation expense |
|
$ |
12,919 |
|
|
$ |
12,063 |
|
|
$ |
11,073 |
|
|
$ |
49,461 |
|
|
$ |
42,779 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(4) |
Amortization of acquired
intangible assets consists of developed technology, trade names,
customer relationships and backlog acquired in connection with the
Coriant acquisition. Amortization of acquired intangible assets
also consists of amortization of developed technology, trade names
and customer relationships acquired in connection with the
Transmode AB acquisition. U.S. GAAP accounting requires that
acquired intangible assets are recorded at fair value and amortized
over their useful lives. As this amortization is non-cash, Infinera
has excluded it from its non-GAAP gross profit, operating expenses
and net income measures. Management believes the amortization of
acquired intangible assets is not indicative of ongoing operating
performance and its exclusion provides a better indication of
Infinera's underlying business performance. |
| |
|
| (5) |
Acquisition and integration costs
consist of legal, financial, IT, manufacturing-related costs,
employee-related costs and professional fees incurred in connection
with the Coriant acquisition. These amounts have been adjusted in
arriving at Infinera's non-GAAP results because management believes
that these expenses are non-recurring, not indicative of ongoing
operating performance and their exclusion provides a better
indication of Infinera's underlying business performance. |
| |
|
|
(6) |
Business combination accounting
principles require Infinera to measure acquired inventory at fair
value. The fair value of inventory reflects the acquired company’s
cost of manufacturing plus a portion of the expected profit margin.
The non-GAAP adjustment to Infinera's cost of sales excludes the
amortization of the acquisition-related step-up in carrying value
for units sold in the quarter. Additionally, in connection with the
Coriant acquisition, cost of sales excludes a one-time adjustment
in inventory as a result of renegotiated supplier agreements that
contained unusually higher than market pricing. Management believes
these adjustments are useful to investors as an additional means to
reflect ongoing cost of sales and gross margin trends of Infinera's
business. |
|
|
|
|
(7) |
Restructuring and related costs
are primarily associated with the reduction of operating costs, the
closure of Infinera's Berlin, Germany site, the reduction of
headcount at Infinera's Munich, Germany site and other sites, and
Coriant's historical restructuring plan associated with its early
retirement plan. In addition, this includes accelerated
amortization on operating lease right-of-use assets due to the
cessation of use of certain facilities. Management has excluded the
impact of these charges in arriving at Infinera's non-GAAP results
as they are non-recurring in nature and its exclusion provides a
better indication of Infinera's underlying business
performance. |
|
|
|
|
(8) |
COVID-19 related costs consist of
higher replacement costs associated with certain warranty parts
customers were unable to return for repair due to logistics issues
and mobility issues related to COVID-19 public health mandates and
restrictions. In addition, Infinera needed to source certain key
components from an alternate supplier at substantially higher cost
in order to fulfill delivery commitments in the normal course of
business. Management has excluded these expenses from non-GAAP
financial measures because they were caused by atypical
circumstances during the COVID-19 pandemic, as their exclusion
provides a better indication of Infinera's underlying business
performance. |
|
|
|
|
(9) |
Litigation charges are associated
with the preliminary settlement of a litigation matter agreed to
during the quarter ended June 29, 2019. Management has excluded the
impact of this charge in arriving at Infinera's non-GAAP results
because it is non-recurring and management believes that this
expense is not indicative of ongoing operating performance. |
|
|
|
|
(10) |
Under GAAP, certain convertible
debt instruments that may be settled in cash on conversion are
required to be separately accounted for as liability (debt) and
equity (conversion option) components of the instrument in a manner
that reflects the issuer's non-convertible debt borrowing rate.
Accordingly, for GAAP purposes, Infinera is required to amortize as
debt discount an amount equal to the fair value of the conversion
option that was recorded in equity as interest expense on the
$402.5 million in aggregate principal amount of its 2.125%
convertible debt issuance in September 2018 due September 2024 and
$200 million in aggregate principal amount of 2.50% convertible
debt issued in March 9, 2020 due March 2027. Interest expense has
been excluded from Infinera's non-GAAP results because management
believes that this non-cash expense is not indicative of ongoing
operating performance and its exclusion provides a better
indication of Infinera's underlying business performance. |
|
|
|
|
(11) |
Management has excluded the gain
on the sale related to non-marketable equity investments in
arriving at Infinera's non-GAAP results because it is
non-recurring, and management believes that this income is not
indicative of ongoing operating performance |
| |
|
|
(12) |
The difference between the GAAP
and non-GAAP tax provision is due to the net tax effects of the
purchase accounting adjustments, acquisition-related costs and
amortization of acquired intangible assets. |
|
|
|
|
(13) |
Non-GAAP EPS as adjusted did not
exclude the impact of foreign currency. Had the impact of foreign
currency been excluded for the three months ended December 26,
2020, September 26, 2020 and December 28, 2019, non-GAAP EPS as
adjusted would have been $0.08, loss of less than one cent, and
$0.02, respectively, and for the twelve months ended December 26,
2020 and December 28, 2019, non-GAAP EPS as adjusted would have
been $(0.19) and $(0.57), respectively. |
|
|
|
|
(14) |
The non-GAAP diluted shares
include the potentially dilutive securities from Infinera's
stock-based benefit plans excluded from the computation of dilutive
net loss per share attributable to common stockholders on a GAAP
basis because the effect would have been anti-dilutive. These
potentially dilutive securities are added for the computation of
diluted net income per share on a non-GAAP basis in periods when
Infinera has net income on a non-GAAP basis. During the three
months ended December 26, 2020, the Company included the dilutive
effects of the 2027 Notes in the calculation of diluted net income
per common share as the average market price was above the
conversion price of the Notes. The dilutive impact of the Notes was
based on the difference between the Company's average stock price
during the period and the conversion price of the Notes. |
Infinera CorporationCondensed
Consolidated Balance Sheets(In thousands, except
par values)(Unaudited)
| |
December 26,2020 |
|
December 28,2019 |
| ASSETS |
|
|
|
| Current assets: |
|
|
|
|
Cash |
$ |
298,014 |
|
|
|
$ |
109,201 |
|
|
|
Short-term restricted cash |
3,293 |
|
|
|
4,339 |
|
|
|
Accounts receivable, net of allowance for doubtful accounts of
$2,912 in 2020 and $4,005 in 2019 |
319,428 |
|
|
|
349,645 |
|
|
|
Inventory |
269,307 |
|
|
|
340,429 |
|
|
|
Prepaid expenses and other current assets |
171,831 |
|
|
|
139,217 |
|
|
|
Total current assets |
1,061,873 |
|
|
|
942,831 |
|
|
| Property, plant and equipment,
net |
153,133 |
|
|
|
150,793 |
|
|
| Operating lease right-of-use
assets |
68,851 |
|
|
|
68,081 |
|
|
| Intangible assets |
124,882 |
|
|
|
170,346 |
|
|
| Goodwill |
273,426 |
|
|
|
249,848 |
|
|
| Long-term restricted cash |
14,076 |
|
|
|
19,257 |
|
|
| Other non-current assets |
36,256 |
|
|
|
27,182 |
|
|
|
Total assets |
$ |
1,732,497 |
|
|
|
$ |
1,628,338 |
|
|
| LIABILITIES AND
STOCKHOLDERS’ EQUITY |
|
|
|
| Current liabilities: |
|
|
|
|
Accounts payable |
$ |
175,762 |
|
|
|
$ |
273,397 |
|
|
|
Accrued expenses and other current liabilities |
150,550 |
|
|
|
193,168 |
|
|
|
Accrued compensation and related benefits |
52,976 |
|
|
|
92,221 |
|
|
|
Short-term debt, net |
101,983 |
|
|
|
31,673 |
|
|
|
Accrued warranty |
19,369 |
|
|
|
21,107 |
|
|
|
Deferred revenue |
133,246 |
|
|
|
103,753 |
|
|
|
Total current liabilities |
633,886 |
|
|
|
715,319 |
|
|
| Long-term debt, net |
445,996 |
|
|
|
323,678 |
|
|
| Long-term financing lease
obligations |
1,383 |
|
|
|
2,394 |
|
|
| Accrued warranty,
non-current |
21,339 |
|
|
|
22,241 |
|
|
| Deferred revenue,
non-current |
29,810 |
|
|
|
36,067 |
|
|
| Deferred tax liability |
4,164 |
|
|
|
8,700 |
|
|
| Operating lease liabilities |
76,126 |
|
|
|
64,210 |
|
|
| Other long-term liabilities |
93,509 |
|
|
|
69,194 |
|
|
| Commitments and
contingencies |
|
|
|
| Stockholders’ equity: |
|
|
|
|
Preferred stock, $0.001 par valueAuthorized shares – 25,000 and no
shares issued and outstanding |
— |
|
|
|
— |
|
|
|
Common stock, $0.001 par value Authorized shares – 500,000 as of
December 26, 2020 and December 28, 2019 Issued and outstanding
shares – 201,397 as of December 26, 2020 and 181,134 as of
December 28, 2019 |
201 |
|
|
|
181 |
|
|
|
Additional paid-in capital |
1,965,245 |
|
|
|
1,740,884 |
|
|
|
Accumulated other comprehensive loss |
(11,898 |
) |
|
|
(34,639 |
) |
|
|
Accumulated deficit |
(1,527,264 |
) |
|
|
(1,319,891 |
) |
|
|
Total stockholders' equity |
426,284 |
|
|
|
386,535 |
|
|
|
Total liabilities and stockholders’ equity |
$ |
1,732,497 |
|
|
|
$ |
1,628,338 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Infinera CorporationCondensed
Consolidated Statements of Cash Flows(In
thousands) (Unaudited)
| |
Twelve Months Ended |
| |
December 26,2020 |
|
December 28,2019 |
| Cash Flows from Operating
Activities: |
|
|
|
|
Net loss |
$ |
(206,723 |
) |
|
|
$ |
(386,618 |
) |
|
| Adjustments to reconcile net
loss to net cash used in operating activities: |
|
|
|
|
Depreciation and amortization |
100,140 |
|
|
|
119,824 |
|
|
|
Non-cash restructuring charges and related costs |
5,471 |
|
|
|
13,937 |
|
|
|
Amortization of debt discount and issuance costs |
28,115 |
|
|
|
19,162 |
|
|
|
Operating lease expense |
18,556 |
|
|
|
31,141 |
|
|
|
Stock-based compensation expense |
49,461 |
|
|
|
43,294 |
|
|
|
Other, net |
4,438 |
|
|
|
178 |
|
|
|
Changes in assets and liabilities: |
|
|
|
|
Accounts receivable |
32,150 |
|
|
|
(35,395 |
) |
|
|
Inventory |
71,424 |
|
|
|
(42,840 |
) |
|
|
Prepaid expenses and other assets |
(36,127 |
) |
|
|
(93,621 |
) |
|
|
Accounts payable |
(93,411 |
) |
|
|
83,272 |
|
|
|
Accrued liabilities and other expenses |
(107,704 |
) |
|
|
54,658 |
|
|
|
Deferred revenue |
21,910 |
|
|
|
25,658 |
|
|
|
Net cash used in operating activities |
(112,300 |
) |
|
|
(167,350 |
) |
|
| Cash Flows from Investing
Activities: |
|
|
|
|
Proceeds from sales of available-for-sale investments |
— |
|
|
|
1,499 |
|
|
|
Proceeds from sale of non-marketable equity investments |
— |
|
|
|
1,009 |
|
|
|
Proceeds from maturities of investments |
— |
|
|
|
25,085 |
|
|
|
Acquisition of business, net of cash acquired |
— |
|
|
|
(10,000 |
) |
|
|
Purchase of property and equipment, net |
(39,009 |
) |
|
|
(30,202 |
) |
|
|
Net cash used in investing activities |
(39,009 |
) |
|
|
(12,609 |
) |
|
| Cash Flows from Financing
Activities: |
|
|
|
|
Proceeds from issuance of common stock from at-the-market equity
offering, net of issuance costs of $3,380 |
92,916 |
|
|
|
— |
|
|
|
Proceeds from issuance of 2027 Notes |
194,500 |
|
|
|
— |
|
|
|
Proceeds from revolving line of credit |
55,000 |
|
|
|
48,125 |
|
|
|
Proceeds from short-term borrowings |
— |
|
|
|
24,310 |
|
|
|
Proceeds from mortgage payable |
— |
|
|
|
8,584 |
|
|
|
Repayment of revolving line of credit |
(8,000 |
) |
|
|
(20,000 |
) |
|
|
Repayment of third party manufacturing funding |
(5,346 |
) |
|
|
— |
|
|
|
Payment of debt issuance cost |
(2,455 |
) |
|
|
(273 |
) |
|
|
Repayment of mortgage payable |
(233 |
) |
|
|
(300 |
) |
|
|
Principal payments on financing lease obligations |
(1,587 |
) |
|
|
(163 |
) |
|
|
Payment of term license obligation |
(5,692 |
) |
|
|
— |
|
|
|
Proceeds from issuance of common stock |
17,072 |
|
|
|
12,053 |
|
|
|
Minimum tax withholding paid on behalf of employees for net share
settlement |
(2,013 |
) |
|
|
(426 |
) |
|
|
Net cash provided by financing activities |
334,162 |
|
|
|
71,910 |
|
|
| Effect of exchange rate
changes on cash and restricted cash |
(267 |
) |
|
|
(1,491 |
) |
|
| Net change in cash, cash
equivalents and restricted cash |
182,586 |
|
|
|
(109,540 |
) |
|
| Cash, cash equivalents and
restricted cash at beginning of period |
132,797 |
|
|
|
242,337 |
|
|
| Cash and restricted cash at
end of period(1) |
$ |
315,383 |
|
|
|
$ |
132,797 |
|
|
| |
|
|
|
| Supplemental
disclosures of cash flow information: |
|
|
|
|
Cash paid for income taxes, net |
$ |
5,039 |
|
|
|
$ |
16,944 |
|
|
|
Cash paid for interest |
$ |
15,638 |
|
|
|
$ |
9,564 |
|
|
| Supplemental schedule
of non-cash investing and financing activities: |
|
|
|
|
Unpaid debt issuance cost |
$ |
— |
|
|
|
$ |
2,493 |
|
|
|
Third-party manufacturer funding for transfer expenses
incurred |
$ |
— |
|
|
|
$ |
6,960 |
|
|
|
Transfer of inventory to fixed assets |
$ |
1,083 |
|
|
|
$ |
2,961 |
|
|
|
Property and equipment included in accounts payable and accrued
liabilities |
$ |
— |
|
|
|
$ |
3,838 |
|
|
|
Unpaid term licenses (included in accounts payable, accrued
liabilities and other long term liabilities) |
$ |
12,478 |
|
|
|
$ |
— |
|
|
|
|
|
|
|
|
|
|
|
|
|
| (1) |
Reconciliation
of cash and restricted cash to the condensed consolidated balance
sheets: |
| |
|
|
|
| |
December 26,2020 |
|
December 28,2019 |
| |
|
|
|
| |
(In thousands) |
|
Cash |
$ |
298,014 |
|
|
$ |
109,201 |
|
| Short-term restricted
cash |
3,293 |
|
|
$ |
4,339 |
|
| Long-term restricted cash |
14,076 |
|
|
$ |
19,257 |
|
|
Total cash and restricted cash |
$ |
315,383 |
|
|
$ |
132,797 |
|
|
|
|
|
|
|
|
|
|
Infinera CorporationSupplemental
Financial Information(Unaudited)
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
Q1'19 |
|
Q2'19 |
|
Q3'19 |
|
Q4'19 |
|
Q1'20 |
|
Q2'20 |
|
Q3'20 |
|
Q4'20 |
|
GAAP Revenue ($ Mil) |
|
$292.7 |
|
|
$296.3 |
|
|
$325.3 |
|
|
$384.6 |
|
|
$330.3 |
|
|
$331.6 |
|
|
$340.2 |
|
|
$353.5 |
|
| GAAP Gross Margin % |
|
22.7 |
% |
|
20.7 |
% |
|
26.7 |
% |
|
29.0 |
% |
|
23.3 |
% |
|
29.4 |
% |
|
31.8 |
% |
|
35.7 |
% |
| Non-GAAP Gross Margin
%(1) |
|
35.3 |
% |
|
30.7 |
% |
|
33.1 |
% |
|
35.2 |
% |
|
28.3 |
% |
|
33.8 |
% |
|
35.2 |
% |
|
37.6 |
% |
| Revenue
Composition: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Domestic % |
|
45 |
% |
|
45 |
% |
|
51 |
% |
|
52 |
% |
|
52 |
% |
|
50 |
% |
|
49 |
% |
|
36 |
% |
| International % |
|
55 |
% |
|
55 |
% |
|
49 |
% |
|
48 |
% |
|
48 |
% |
|
50 |
% |
|
51 |
% |
|
64 |
% |
| Customers >10% of
Revenue |
|
1 |
|
|
1 |
|
|
1 |
|
|
1 |
|
|
1 |
|
|
1 |
|
|
1 |
|
|
— |
|
| Cash Related
Information: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Cash from Operations ($
Mil) |
|
($56.2 |
) |
|
($63.8 |
) |
|
($37.2 |
) |
|
($10.2 |
) |
|
($91.5 |
) |
|
($36.6 |
) |
|
($36.4 |
) |
|
$52.2 |
|
| Capital Expenditures ($
Mil) |
|
$6.6 |
|
|
$9.2 |
|
|
$12.5 |
|
|
$2.7 |
|
|
$8.5 |
|
|
$10.5 |
|
|
$8.1 |
|
|
$11.9 |
|
| Depreciation &
Amortization ($ Mil) |
|
$31.0 |
|
|
$31.2 |
|
|
$29.0 |
|
|
$28.6 |
|
|
$25.4 |
|
|
$25.9 |
|
|
$22.9 |
|
|
$25.9 |
|
| DSOs |
|
83 |
|
|
80 |
|
|
80 |
|
|
83 |
|
|
75 |
|
|
79 |
|
|
78 |
|
|
82 |
|
| Inventory
Metrics: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Raw Materials ($ Mil) |
|
$82.5 |
|
|
$70.4 |
|
|
$47.2 |
|
|
$47.4 |
|
|
$50.0 |
|
|
$43.4 |
|
|
$39.3 |
|
|
$34.7 |
|
| Work in Process ($ Mil) |
|
$63.0 |
|
|
$59.5 |
|
|
$52.2 |
|
|
$48.8 |
|
|
$52.0 |
|
|
$50.9 |
|
|
$51.6 |
|
|
$55.8 |
|
| Finished Goods ($ Mil) |
|
$187.0 |
|
|
$208.9 |
|
|
$225.4 |
|
|
$244.1 |
|
|
$217.7 |
|
|
$193.9 |
|
|
$185.0 |
|
|
$178.8 |
|
| Total Inventory ($
Mil) |
|
$332.5 |
|
|
$338.8 |
|
|
$324.8 |
|
|
$340.3 |
|
|
$319.7 |
|
|
$288.2 |
|
|
$275.9 |
|
|
$269.3 |
|
| Inventory Turns(2) |
|
2.3 |
|
|
2.5 |
|
|
2.7 |
|
|
2.9 |
|
|
3.0 |
|
|
3.1 |
|
|
3.2 |
|
|
3.3 |
|
| Worldwide
Headcount |
|
3,708 |
|
|
3,632 |
|
|
3,557 |
|
|
3,261 |
|
|
3,302 |
|
|
3,209 |
|
|
3,074 |
|
|
3,050 |
|
| Weighted Average
Shares Outstanding (in thousands): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Basic |
|
176,406 |
|
|
178,677 |
|
|
179,988 |
|
|
180,864 |
|
|
182,024 |
|
|
185,596 |
|
|
189,589 |
|
|
195,655 |
|
| Diluted |
|
176,602 |
|
|
179,343 |
|
|
182,073 |
|
|
186,349 |
|
|
189,246 |
|
|
190,127 |
|
|
195,868 |
|
|
203,259 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
Non-GAAP adjustments include acquisition-related deferred revenue
and inventory adjustments, other customer related charges,
stock-based compensation expenses, amortization of acquired
intangible assets, acquisition and integration costs, restructuring
and related costs, and COVID-19 related costs. For a description of
this non-GAAP financial measure, please see the section titled
“GAAP to Non-GAAP Reconciliations” in this press release for a
reconciliation to the most directly comparable GAAP financial
measures. |
| |
|
| (2) |
Infinera calculates non-GAAP
inventory turns as annualized non-GAAP cost of revenue before
adjustments for restructuring and related costs, non-cash
stock-based compensation expense, and certain purchase accounting
adjustments, divided by the average inventory for the quarter. |
Infinera CorporationGAAP to Non-GAAP
Reconciliation of Financial Outlook(In millions,
except percentages and per share
data)(Unaudited)
The following amounts represent the midpoint of the expected
range:
| |
|
Q1'21 |
| |
|
Outlook |
| Reconciliation of
Revenue: |
|
|
|
U.S. GAAP |
|
$ |
329.0 |
|
|
| Acquisition-related deferred
revenue adjustment |
|
1.0 |
|
|
| Non-GAAP |
|
$ |
330.0 |
|
|
| |
|
|
| Reconciliation of Gross
Margin: |
|
|
| U.S. GAAP |
|
32.5 |
% |
|
| Acquisition-related deferred
revenue adjustment |
|
0.5 |
% |
|
| Stock-based compensation |
|
1.0 |
% |
|
| Amortization of acquired
intangible assets |
|
1.0 |
% |
|
| Restructuring and related
costs |
|
0.5 |
% |
|
| Non-GAAP |
|
35.5 |
% |
|
| |
|
|
| Reconciliation of
Operating Expenses: |
|
|
| U.S. GAAP |
|
$ |
144.0 |
|
|
| Stock-based compensation |
|
(14.0 |
) |
|
| Amortization of acquired
intangible assets |
|
(4.0 |
) |
|
| Restructuring and related
costs |
|
(2.0 |
) |
|
| Acquisition and integration
costs |
|
(1.0 |
) |
|
| Non-GAAP |
|
$ |
123.0 |
|
|
| |
|
|
| Reconciliation of
Operating Margin: |
|
|
| U.S. GAAP |
|
(11.5 |
)% |
|
| Acquisition-related deferred
revenue adjustment |
|
0.5 |
% |
|
| Stock-based compensation |
|
5.0 |
% |
|
| Amortization of acquired
intangible assets |
|
2.5 |
% |
|
| Acquisition and integration
costs |
|
0.5 |
% |
|
| Restructuring and related
costs |
|
1.0 |
% |
|
| Non-GAAP |
|
(2.0 |
)% |
|
| |
|
|
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