MILPITAS, CA — (Marketwired) — 01/27/16 — SGI (NASDAQ: SGI), a global leader in high performance solutions for compute, data analytics and data management, today reported financial results for its fiscal second quarter ended December 25, 2015. The data in this release is presented on both a GAAP and non-GAAP basis and a reconciliation of GAAP to non-GAAP measures is included in the financial tables in this press release.
Total revenue for the second quarter was $152 million compared to $138 million in the second quarter of 2015. GAAP net loss for the second quarter was $0.5 million, or $(0.01) per share compared with a net loss of $10 million, or $(0.30) per share in the second quarter of 2015. Non-GAAP net income in the second quarter was $5 million, or $0.14 per share compared with net income of $0.1 million, or breakeven per share in the same quarter a year ago.
“The second quarter results marked our return to non-GAAP profitability with improvements in both the top and bottom line,” said Jorge Titinger, President and CEO. “We made significant progress in our high performance data analytics business as we surpassed $10 million in revenue this quarter. We also continued to gain traction winning large deals in HPC such as the recent NCAR award in the weather vertical.”
The National Center for Atmospheric Research (“NCAR”) selected SGI–s ICE XA to build one of the world–s most advanced computer systems that will be used to develop models able to predict climate change and severe weather events on a global scale well into the future.
SGI delivered and put in production one of the fastest supercomputers in Latin America to CINVESTAV, which is expected to rank in the TOP500 supercomputers in the world. This new supercomputer will be used for modeling and research in earth and life sciences and was selected for its leading energy efficiency and flexible compute power.
The Nagaoka University of Technology recently chose SGI–s family of servers for its Information Processing Centre. As demand outpaced capacity, the SGI solution was the preferred choice for the university to significantly improve both performance and capacity for its users.
Consistent with its previously provided outlook for the full year, the company continues to expect:
Revenue in the range of $600 to $625 million, or year-over-year growth of 15 – 20%;
Non-GAAP gross margin between 26% and 27%;
Non-GAAP operating expenses flat to down 5% year-over-year;
Non-GAAP net income in the range of $0.25 to $0.35 per share after excluding approximately $17 million of adjustments; and
GAAP net loss in the range of $(0.11) to $(0.21) per share.
For the third quarter, we expect to be profitable on a non-GAAP basis at approximately $140 million in revenue.
SGI–s second quarter fiscal 2016 financial results conference call is scheduled to take place on Wednesday, January 27, 2016 at 1:30 p.m. PT (4:30 p.m. ET). A live webcast of the company–s earnings conference call will be available simultaneously on the Investor Relations section of the company–s website at investors.sgi.com. A replay of the webcast will also be available approximately two hours after the conclusion of the conference call and will remain available until next quarter.
The earnings conference call can also be accessed by dialing (888) 463-5422 (toll-free) or (970) 315-0484 (international) and entering the confirmation code: 17957979. An audio replay of the conference call will also be made available approximately two hours after the conclusion of the call. The audio replay will remain available for five days and can be accessed by dialing (855) 859-2056 (toll-free) or (404) 537-3406 (international) and entering the confirmation code: 17957979.
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The statements made in this press release regarding projected financial results, including SGI–s growth strategy, outlook regarding future profitability and positive cash generation, as well as certain statements made in the earnings conference call, are forward-looking statements within the meaning of the safe harbor provisions of Section 21E of the Securities Exchange Act of 1934 and Section 27A of the Securities Act of 1933. Actual results could differ materially from those described by these statements due to a number of factors, including, but not limited to the following: sales to U.S. government entities, which are subject to the government–s budgetary constraints; customer concentration risks; fluctuations in the buying patterns and sizes of customer orders from one quarter to the next; increased competition causing SGI to sell products or services at lower margins than expected; lengthy acceptance cycles of SGI–s products by certain customers and their effects on SGI–s revenue and liquidity; development or product delivery delays, delays in obtaining necessary components from suppliers or delays in customer acceptance once products are delivered; the addition of new customers or loss of existing customers; unexpected changes in the price for, and the availability of, components from SGI–s suppliers; SGI–s ability to enhance its products with new and better designs and functionality; actions taken by competitors, such as new product announcements or introductions or changes in pricing; market acceptance of newer products; and risks related to SGI–s term loan. Some of these risks and uncertainties are described in more detail in SGI–s most recent Forms 10-K and 10-Q and other filings with the Securities and Exchange Commission (“SEC”) and are available at the SEC–s web site at . Forward-looking statements are made based on information available to the company on the date of this press release. The company assumes no obligation to update the information in this press release.
This press release and the related earnings conference call include financial measures that are not determined in accordance with U.S. generally accepted accounting principles (“GAAP”), including non-GAAP gross margin, non-GAAP net income (loss) and non-GAAP basic and diluted net income (loss) per share. These non-GAAP measures are not based on any comprehensive set of accounting rules or principles and management exercises judgment in determining which items should be excluded in the calculation of non-GAAP measures. In addition, these non-GAAP measures may be different from non-GAAP measures used by other companies. While we believe that non-GAAP measures have limitations in that they do not reflect all of the amounts associated with our results of operations as determined in accordance with GAAP, we believe that non-GAAP measures are valuable in evaluating the company–s operating performance and analyzing our business operations. Management may exclude the following items from one or more of non-GAAP measures: (1) share-based compensation; (2) amortization and impairment of intangible assets; (3) restructuring and severance charges; (4) excess and obsolete inventory write-offs; (5) gains or losses on investments; and (6) other non-recurring costs. Pursuant to the requirements of SEC Regulation G, a detailed reconciliation between GAAP and non-GAAP financial results is provided in this press release. The adjustments made should not be construed as an inference that all such adjustments or costs are unusual, infrequent or non-recurring. Investors are advised to carefully review and consider this information as well as the GAAP financial results that are disclosed in this release and SGI–s SEC filings.
For a full reconciliation of historical non-GAAP measures referenced in this press release or today–s presentation to the comparable measures under GAAP, please refer to the company–s press releases on its website at .
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SGI Investor Relations
Annie Leschin
(415) 775-1788
Ben Liao
(669) 900-8090
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