FREMONT, CA — (Marketwired) — 10/29/13 — Ikanos Communications, Inc. (NASDAQ: IKAN)
Revenue of $16.9 million
GAAP Gross Profit of 51%
GAAP Operating Expenses of $17.0 million
Cash, Cash Equivalents and Short-Term Investments of $25.6 million
Ikanos Communications, Inc. (NASDAQ: IKAN), a leading provider of advanced broadband semiconductor and integrated software products for the digital home, today announced its financial results for the fiscal third quarter of 2013 ended September 29, 2013.
“Ikanos achieved better than expected third quarter results, with gross profits exceeding our target, while revenue ended near the mid-range of our guidance,” said Dennis Bencala, chief financial officer and vice president of finance at Ikanos. “We achieved revenue of $16.9 million, with a GAAP gross profit of 51%, well above our guidance of 47% to 49%. We also sequentially reduced operating expenses for the fourth consecutive quarter, with OPEX down to $17.0 million and below our guidance of $17.5 to $18.5 million. Additionally, quarter-end inventory was managed to $1.6 million, while meeting customer demand and contributing to a quarter-ending cash and short-term investments balance of $25.6 million.”
“While we continued to grow our opportunity pipeline with a number of new design wins in Q3, we also took a significant step forward in securing Ikanos- position in the emerging FTTdp market,” said Omid Tahernia, president and CEO at Ikanos. “This was accomplished through the introduction of our single-port CO processor, the Velocity-Uni, which was formally launched at the Broadband World Forum (BBWF) conference in Amsterdam last week. Also at the conference, we were quite pleased to be selected as the recipient of InfoVision-s “Best Broadband Enabler” award this year, with our Velocity-3 taking the top spot in recognition of its technical excellence.”
“While we continue to navigate through the current transition in our business, we remain positive on the outlook,” continued Tahernia. “We see the additional design wins, the expansion of our TAM with new products such as inSIGHT and Velocity-Uni, and the early customer demand for our next-generation G.fast platform, creating tremendous market momentum and future growth potential for our overall business.”
Ikanos reports its financial results in accordance with U.S. generally accepted accounting principles (GAAP) and additionally on a non-GAAP basis. Non-GAAP net income (loss), non-GAAP gross profits, non-GAAP operating expenses and non-GAAP earnings per share, where applicable, exclude the income statement effects of stock-based compensation, restructuring charges and amortization of intangible assets. Ikanos has provided these measures because its management believes these additional non-GAAP measures are useful to investors for performing financial analysis as these additional measures highlight Ikanos- recurring operating results. Ikanos- management uses these non-GAAP measures internally to evaluate Ikanos operating performance and to plan for its future. However, non-GAAP measures are not a substitute for GAAP reporting. For a reconciliation of GAAP versus non-GAAP financial information, please see the attached schedules.
Revenue for the third quarter of 2013 was $16.9 million, compared to revenue of $31.4 million for the third quarter of 2012 and revenue of $19.1 million for the second quarter of 2013. GAAP gross profit for the third quarter of 2013 was 51%, compared to a GAAP gross profit of 47% for the third quarter of 2012 and GAAP gross profit of 49% for the second quarter of 2013.
Non-GAAP gross profit for the third quarter of 2013 was 52%, compared to a non-GAAP gross profit of 48% for the third quarter of 2012 and non-GAAP gross profit of 49% for the second quarter of 2013.
GAAP operating expenses for the third quarter of 2013 were $17.0 million, compared to operating expenses of $21.1 million for the third quarter of 2012 and operating expenses of $17.5 million for the second quarter of 2013.
Non-GAAP operating expenses for the third quarter of 2013 were $16.0 million, compared to non-GAAP operating expenses of $20.2 million for the third quarter of 2012 and non-GAAP operating expenses of $16.5 million for the second quarter of 2013.
GAAP net loss for the third quarter of 2013 was $(8.7) million, or a loss of $(0.12) per share on 71.7 million weighted average shares outstanding. This compares with a net loss of $(6.4) million, or a loss of $(0.09) per share on 69.8 million weighted average shares outstanding for the third quarter of 2012 and a GAAP net loss of $(8.7) million, or a loss of $(0.12) per share on 71.2 million weighted average shares outstanding for the second quarter of 2013.
Non-GAAP net loss for the third quarter of 2013 was $(7.5) million, or a loss of $(0.11) per share on 71.7 million weighted average shares outstanding compared to a non-GAAP net loss of $(5.1) million, or a loss of $(0.07) per share on 69.8 million weighted average shares outstanding for the third quarter of 2012, and a non-GAAP loss of $(7.5) million, or a loss of $(0.11) per share on 71.2 million weighted average shares outstanding for the second quarter of 2013.
Cash, cash equivalents and short-term investments at the end of third quarter of 2013 were $25.6 million, compared to $27.3 million at the end of the second quarter of 2013.
Additionally, at the end of the third quarter of 2013 inventory was $1.6 million compared to $4.0 million at the end of the second quarter of 2013. Current liabilities at the end of the third quarter of 2013 were $25.8 million, compared to $21.1 million at the end of the second quarter of 2013.
Revenue is expected to be between $17.0 million and $19.0 million for the fiscal fourth quarter of 2013.
GAAP gross profit for the fiscal fourth quarter of 2013 is expected to be between 49% and 51%. Non-GAAP gross profit is expected to be between 50% and 52% for the fourth quarter of 2013.
GAAP operating expenses for the fiscal fourth quarter of 2013 are expected to be in the range of $17.0 million to $18.0 million. On a non-GAAP basis operating expenses are expected to be in the range of $16.0 million to $17.0 million for the fourth quarter of 2013.
GAAP net loss for the fiscal fourth quarter of 2013 is expected to be in the range of approximately $(7.5) million to $(9.9) million, or a GAAP loss per share of $(0.10) to $(0.14). Non-GAAP net loss for the fiscal fourth quarter of 2013 is expected to be in the range of approximately $(6.5) million to $(8.6) million, or a non-GAAP loss per share of $(0.09) to $(0.12).
Management will review the third quarter financial results and its expectations for subsequent periods on a conference call on Tuesday, October 29, 2013 at 1:30 p.m. Pacific Time. To listen to the call, please visit and click on the link provided for the webcast or dial (888) 428-9490 or (719) 325-2432 and enter conference ID 8616859. The webcast will be archived and available for 90 days at . A replay of the conference call will be accessible until January 27, 2014 by dialing (888) 203-1112 or (719) 457-0820 and entering conference ID 8616859.
Ikanos Communications, Inc. (NASDAQ: IKAN) is a leading provider of advanced broadband semiconductor and integrated software products for the digital home. The company-s broadband DSL, communications processors and other offerings power access infrastructure and customer premises equipment for many of the world-s leading network equipment manufacturers and telecommunications service providers. For more information, visit .
© 2013 Ikanos Communications, Inc. All Rights Reserved. Ikanos Communications, Ikanos and the Ikanos logo, the Bandwidth without boundaries tagline, Fusiv, inSIGHT, Neos, Ikanos Velocity and Ikanos NodeScale are among the trademarks or registered trademarks of Ikanos Communications. All other trademarks mentioned herein are properties of their respective holders.
Some of the statements included in this press release constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. You should not place undue reliance on these statements. These forward-looking statements include statements that reflect the current views of our senior management with respect to our financial performance and future events with respect to our business and our industry in general. Statements that include the words “expect,” “intend,” “plan,” “believe,” “anticipate,” “estimate,” and similar statements of a future or forward-looking nature identify forward-looking statements.
Forward-looking statements address matters that involve risks and uncertainties. Accordingly, there are or will be important factors that could cause our actual results to differ materially from those indicated in these statements. We believe that these factors include, but are not limited to, the following: our ability to reduce or maintain operating expenses at current levels; our ability to successfully complete the public offering as described in our Registration Statement on Form S-1 filed on August 23, 2013; our ability to translate customer demand into revenue; our ability to deliver full production releases of our newer products and the acceptance of those products by our customers and telecommunications service providers; that not all design wins nor successful lab or field trials will result in revenue for us; macroeconomic conditions which may cause our customers to defer purchasing plans or cancel any purchasing plans altogether despite successful design wins; that production ramps by our customers will continue at the same rate or at all; the continued demand by telecommunications service providers for our specific xDSL semiconductor products; our ability to maintain an adequate cash and short-term investment balance; our ability to comply with the financial covenants in our credit agreement; the failure of telecommunications service providers to implement deployment plans on schedule, or at all, despite positive engagements or successful lab or field trials; our continued ability to obtain and deliver production volumes of new and current products and technologies; our ability to generate demand and close transactions for the sale of our products; our ability to develop commercially successful products as a result of our current research and development programs; our reliance on third parties to manufacture the products we sell; competition in the markets in which we operate; risks associated with doing business abroad, including foreign currency risks; the fact that the products we sell may not satisfy shifting customer demand or compete successfully with our competitors- products; that our offering of standalone software, selling directly to telecommunications service providers, will generate any revenue for us or result in significant or any operational costs savings for the telecommunications service providers; and unexpected future costs, expenses, and financing requirements. For a more detailed discussion of how these and other risks and uncertainties could cause our actual results to differ materially from those indicated in our forward-looking statements, see our reports filed with SEC (available at ), including our Annual Report on Form 10-K for the fiscal year ended December 30, 2012, our Quarterly Report on Form 10-Q for the second quarter ended June 30, 2013, and our Registration Statement on Form S-1 filed on August 23, 2013. Ikanos undertakes no obligation to update or revise these forward-looking statements to reflect events or circumstances subsequent to date of this press release.
Gary Good
Trainer Communications
707-837-1718
MKR Group, Inc.
Todd Kehrli or Jim Byers
(323) 468-2300
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