InvenSense Inc. (NYSE: INVN), a leading provider of MEMS sensor
platforms, today announced results for its third quarter of fiscal
2016, ended December 27, 2015.
Net revenue for the third quarter of fiscal 2016 was $120.0
million, up 7 percent from $112.5 million for the second quarter of
fiscal 2016, and up 4 percent from $115.9 million for the third
quarter of fiscal 2015.
Gross margin determined in accordance with U.S. generally
accepted accounting principles (GAAP) was 41 percent for the third
quarter of fiscal 2016, consistent with 41 percent for the second
quarter of fiscal 2016. GAAP gross margin for the third quarter of
fiscal 2016 included stock-based compensation and related payroll
taxes, and amortization of acquisition intangibles. Excluding these
items, non-GAAP gross margin was 44 percent for the third quarter
of fiscal 2016, consistent with 44 percent for the second quarter
of fiscal 2016.
GAAP net income for the third quarter of fiscal 2016 was $1.9
million, or 2 cents per diluted share. By comparison, GAAP net
income was $5.7 million, or 6 cents per diluted share for the
second quarter of fiscal 2016. GAAP net income for the third
quarter of fiscal 2016 included stock-based compensation and
related payroll taxes, accreting interest expense on convertible
notes, amortization of acquisition intangibles, business
acquisition costs, other adjustments, the income tax effect of
non-GAAP adjustments, and other discrete tax adjustments. Excluding
these items, non-GAAP net income for the third quarter of fiscal
2016 was $16.7 million, or 18 cents per diluted share, compared
with $14.9 million, or 16 cents per diluted share, for the second
quarter of fiscal 2016.
The reconciliation between GAAP and non-GAAP financial results
for all referenced periods is provided in a table immediately
following the Unaudited GAAP Condensed Consolidated Statements of
Operations below.
Management Qualitative Comments
"Amidst the backdrop of a tumultuous business and financial
environment, InvenSense posted a solid quarter,” said Behrooz Abdi,
president and chief executive officer. "We maintained careful
adherence to our business model, while continuing a rapid pace of
innovation across our product portfolio. We also executed well to
our plan of diversification, growing our revenues in a wide range
of Internet of Things applications, while continuing to drive our
strategic value and competitive differentiation within our mobile
customer base."
Third Quarter of Fiscal Year 2016 Earnings Conference
Call
A conference call will be held today at 1:30 p.m. Pacific Time
to discuss the quarter’s results and management’s current business
outlook.
To listen to the conference call, please dial (530) 379-4724 ten
minutes prior to the start of the call, using the passcode
24973303. International callers, please dial (877) 788-4691. A
taped replay will be made available approximately two hours after
the conclusion of the call and will remain available for seven
days. To access the replay, please dial (404) 537-3406 and enter
passcode 24973303. International callers please dial (855)
859-2056. The conference call will be available via a live webcast
on the investor relations section of InvenSense’s web site at
www.invensense.com/ir. An archived webcast replay will be available
on the web site for three months.
Note Regarding Use of Non-GAAP Financial Measures
As discussed above, in addition to the company’s condensed
consolidated financial statements, which are presented according to
GAAP, the company provides certain non-GAAP financial information
that excludes stock-based compensation expense, certain legal and
litigation expenses, business acquisition costs, amortization of
acquisition-related intangible assets, accreting interest expense
on convertible notes and other adjustments. The company uses these
non-GAAP measures in its own financial and operational
decision-making processes. Further, the company believes that these
non-GAAP measures offer an important analytical tool to help
investors understand the company’s core operating results and
trends and facilitate comparability with the operating results of
other companies that provide similar non-GAAP measures. These
non-GAAP measures have certain limitations as analytical tools and
are not meant to be considered in isolation or as a substitute for
GAAP financial information. For example, stock-based compensation
is an important component of the company’s compensation mix and
will continue to result in significant expenses in the company’s
GAAP results for the foreseeable future, but it is not reflected in
our non-GAAP measures. Also, other companies, including companies
in the company’s industry, may calculate non-GAAP financial
measures differently, limiting their usefulness as comparative
measures.
Forward-Looking Statements
Statements in this press release that are not historical are
“forward-looking statements” as the term is defined in the Private
Securities Litigation Reform Act of 1995. Forward-looking
statements are generally written in the future tense and/or
preceded by words such as “will,” “expects,” “anticipates,” or
other words that imply or predict a future state. Forward-looking
statements include any projection of revenue, gross margin,
expense, earnings, stockholder return or other financial items
discussed in this press release, including the strength of our
competitive positioning, the strength of design activity, increased
demand for our products and design wins contributing to revenue.
Investors are cautioned that all forward-looking statements in this
release involve risks and uncertainty that can cause actual results
to differ from those currently anticipated, due to a number of
factors, including without limitation, intense competition in our
industry; our achievement of design wins; our dependence on a
limited number of customers for a substantial portion of our
revenues; the continued adoption of motion tracking and motion
sensing as an interface in consumer electronics products; decreases
in average selling prices for our products; our ability to execute
on our plan of diversification and our success in growing our
revenues in the Internet of Things applications; our lack of
long-term supply contracts and dependence on limited sources of
supply; consumer acceptance of our customers’ products that
incorporate our solutions and our ability to continue to develop
and introduce new and enhanced products on a timely basis; as well
as changes in economic conditions in our markets and other risk
factors discussed in InvenSense’s Annual Report on Form 10-K for
the year ended March 29, 2015, subsequent quarterly reports on Form
10-Q, recent current reports on Form 8-K, and other documents filed
by us with the Securities and Exchange Commission (SEC) from time
to time. Copies of InvenSense’s SEC filings are posted on the
company’s website and are available from the company without
charge. Forward-looking statements are made as of the date of this
release, and, except as required by law, the company does not
undertake an obligation to update its forward-looking statements to
reflect future events or circumstances.
About InvenSense
InvenSense, Inc. (NYSE: INVN) is the world’s leading provider of
MEMS sensor platforms. The company’s patented InvenSense
Fabrication Platform, MotionFusion® technology, and location
software and services addresses the emerging need of many
mass-market consumer applications via improved performance,
accuracy, and intuitive motion-, gesture- and sound-based
interfaces. InvenSense technology can be found in Mobile,
Wearables, Smart Home, Industrial, and Automotive products.
InvenSense is headquartered in San Jose, California and has offices
in Boston, China, Taiwan, Korea, Japan, France, Canada, Slovakia
and Italy. More information can be found at www.invensense.com and
http://www.coursaretail.com/ follow us on Twitter at
@InvenSense.
©2016 InvenSense, Inc. All rights reserved. InvenSense, Sensing
Everything, FireFly, SensorStudio, TrustedSensor, Coursa, Coursa
Sports, Coursa Retail, UltraPrint, MotionTracking,
MotionProcessing, MotionProcessor, MotionFusion, MotionApps,
InvenSenseTV, DMP, AAR, and the InvenSense logo are trademarks of
InvenSense, Inc. Other company and product names may be trademarks
of the respective companies with which they are associated.
INVENSENSE, INC.
CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS
(In thousands, except per share
amounts)
(Unaudited)
Three Months Ended December 27, September
27, December 28, 2015
2015 2014 Net revenue $ 120,029
$ 112,545 $ 115,864 Costs of revenue 70,228
65,974 65,468 Gross profit 49,801 46,571
50,396 Operating expenses: Research and development 25,690 24,991
24,391 Selling, general and administrative 14,295
15,186 15,551 Total operating expenses
39,985 40,177 39,942
Income from operations 9,816 6,394 10,454 Interest (expense) (2,798
) (2,765 ) (2,690 ) Other income, net (35 ) 104
(281 ) Income before income taxes 6,983 3,733 7,483
Income tax provision (benefit) 5,093 (1,960 )
(2,738 ) Net income $ 1,890 $ 5,693 $ 10,221
Net income per share: Basic $ 0.02 $ 0.06
$ 0.11 Diluted $ 0.02 $ 0.06 $ 0.11
Weighted average shares outstanding used
in computing net income per share:
Basic 91,957 91,574 89,779
Diluted 92,922 92,569
92,336
INVENSENSE, INC.
RECONCILIATION OF GAAP TO NON-GAAP
FINANCIAL RESULTS
(In thousands, except per share
amounts)
(Unaudited)
Three Months
Ended December 27, September 27, December
28, 2015 2015
2014 GAAP net income $ 1,890 $ 5,693 $ 10,221
Adjustments: Stock based compensation expense 8,198 9,249 8,309
Convertible note accretion interest expense 2,034 1,999 1,886
Amortization of acquisition-related intangible assets 2,200 2,254
2,034 Business acquisition costs 198 - 1,160 Patent litigation
legal expense, net (138 ) 144 1,187
Income tax effect of pretax non-GAAP
adjustments and other discrete tax items
2,288 (4,476 ) (5,519 )
Non-GAAP net
income $ 16,670 $ 14,863 $ 19,278
GAAP net income per share of common stock, diluted $ 0.02
$ 0.06 $ 0.11
Non-GAAP net income per share
of common stock, diluted $ 0.18 $ 0.16 $ 0.21
GAAP Gross profit $ 49,801 $ 46,571 $ 50,396
Adjustments: Stock based compensation expense 628 587 591
Amortization of acquisition-related intangible assets 2,144
2,198 1,978
Non-GAAP Gross
profit $ 52,573 $ 49,356 $ 52,965
GAAP Operating Expense $ 39,985 $ 40,177 $ 39,942
Adjustments: Stock based compensation expense 7,570 8,662 7,718
Amortization of acquisition-related intangible assets 56 56 56
Business acquisition costs 198 - 1,160 Patent litigation legal
expense, net (138 ) 144 1,187
Non-GAAP Operating Expense $ 32,299 $ 31,315 $
29,821
INVENSENSE, INC.
CONDENSED CONSOLIDATED BALANCE
SHEETS
(In thousands, except par
value)
(Unaudited)
December 27,
March
29,
2015 2015 Assets
Current assets: Cash and cash equivalents $ 43,877 $ 85,637
Short-term investments 253,342 129,919 Accounts receivable 42,529
44,522 Inventories 61,666 75,105 Prepaid expenses and other current
assets 13,098 14,950 Total current
assets 414,512 350,133 Property and equipment, net 37,730 41,849
Intangible assets, net 38,710 45,508 Goodwill 139,175 139,175 Other
assets 9,290 9,019 Total assets $
639,417 $ 585,684
Liabilities and
Stockholders' Equity Current liabilities: Accounts payable $
44,153 $ 23,130 Accrued liabilities 29,425
31,991 Total current liabilities 73,578 55,121 Long-term
debt 148,801 142,810 Other long-term liabilities 26,548
28,252 Total liabilities 248,927
226,183 Stockholders' equity: Preferred stock:
Preferred stock, $0.001 par value — 20,000
shares authorized, no shares issued and outstanding at December 27,
2015 and March 29, 2015
- - Common stock:
Common stock, $0.001 par value — 750,000
shares authorized, 92,320 shares issued and outstanding at December
27, 2015, 90,894 shares issued and outstanding at March 29,
2015
292,288 262,677 Accumulated other comprehensive (loss) (362 ) (4 )
Retained earnings 98,564 96,828 Total
stockholders' equity 390,490 359,501
Total liabilities and stockholders' equity $ 639,417 $
585,684
INVENSENSE, INC.
CONDENSED CONSOLIDATED STATEMENTS OF
CASH FLOWS
(In thousands)
(Unaudited)
Three Months Ended
December 27,
September 27,
December 28,
2015
2015
2014
Cash flows from operating activities: Net income $
1,890 $ 5,693 $ 10,221 Adjustments to reconcile net income to net
cash provided by operating activities: Depreciation 3,303 3,195
3,047 Amortization of intangible assets 2,295 2,361 2,034 Non cash
interest expense 2,033 2,000 1,907 Loss on disposal of property and
equipment - - 131 Stock-based compensation expense 8,193 9,048
8,300 Deferred income tax assets 5,113 (1,674 ) (5,237 ) Tax effect
of employee benefit plans (118 ) (457 ) 42 Changes in operating
assets and liabilities: Accounts receivable 7,905 (47 ) (7,010 )
Inventories 18 2,807 7,210 Prepaid expenses and other current
assets 104 1,154 946 Other assets 52 (1,715 ) 940 Accounts payable
9,313 8,253 (4,771 ) Accrued liabilities (12,856 )
2,897 94 Net cash provided by operating
activities 27,245 33,515 17,854
Cash flows from investing activities: Purchase
of property and equipment (2,280 ) (1,611 ) (7,665 ) Sale and
maturities of available-for-sale investments 43,081 56,478 14,200
Purchase of available-for-sale investments (93,553 ) (91,305 ) -
Acquisitions, net of cash acquired - -
120 Net cash provided by (used in) investing
activities (52,752 ) (36,438 ) 6,655
Cash flows from financing activities: Proceeds from
exercise of common stock 1,130 226 2,124 Payments contingent
consideration (1,908 ) - - Net
cash provided by (used in) financing activities (778 )
226 2,124 Net increase
(decrease) in cash and cash equivalents (26,285 ) (2,697 ) 26,633
Cash and cash equivalents: Beginning of period 70,162
72,859 38,424 End of period $ 43,877
$ 70,162 $ 65,057
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version on businesswire.com: http://www.businesswire.com/news/home/20160127006243/en/
For Investor Inquiries, Contact:Green Communications
Consulting, LLCLeslie Green,
650-312-9060leslie@greencommunicationsllc.comir@invensense.comorFor
Press Inquiries, Contact:InvenSense, Inc.David Almoslino,
408-501-2278Senior DirectorCorporate Marketingpr@invensense.com
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