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-- Revenue for the third quarter was $173.0 million, up 2% sequentially
-- Net income for the quarter was $10.5 million or $0.07 per share. Non-GAAP net income grew 37% sequentially to $15.7 million or $0.10 per share
-- Cash and investments increased $35.2 million to $134.6 million
-- Acquired TriAccess Technologies, a leading provider of Cable TV (CATV) and Fiber-to-the-Home (FTTH) integrated circuits
-- Signed a Strategic Partner agreement with China's Huawei Technologies to Supply 'Green' Optical products
-- Received Raytheon Space and Airborne Systems' Four-Star Supplier Excellence Award
-- Won a $16.2 million research contract from U.S. Defense Advanced Research Projects Agency (DARPA)
Commenting on the results for the quarter ended September 26, 2009, Ralph Quinsey, President and Chief Executive Officer, stated, "TriQuint revenue, in the last six months, is up 28% compared with the previous six months, demonstrating a strong rebound from the economic slowdown. Non-GAAP net income for Q3 2009 was up 37% sequentially and we finished the quarter with a solid cash position of $134.6 million dollars and no debt. Highlights for the quarter include the acquisition of TriAccess Technologies, a leading provider of cable and fiber-to-the-home devices, an agreement with Huawei Technologies to supply 'green' optical products and new DARPA funding for technology investment in very high frequency materials and applications."
Summary Financial Results for the Quarter Ended September 26, 2009:
Revenue for the third quarter of 2009 was $173.0 million, up 2% sequentially and a decrease of 7% from the third quarter of 2008. All markets enjoyed sequential growth with the networks market growing 13% sequentially, partially due to clearance of excess inventory in the WLAN market.
Net income for the third quarter of 2009 was $10.5 million, or $0.07 per diluted share. Non-GAAP net income for the third quarter grew 37% to $15.7 million, or $0.10 per diluted share. Non-GAAP financial measures exclude stock based compensation charges, a charge for the anticipated settlement of a lawsuit and certain charges associated with acquisitions. Please see the attached supplemental schedule for a reconciliation of GAAP to non-GAAP financial measures.
Gross margin for the third quarter of 2009 was 33.8%, up from 32.3% in the second quarter of 2009. On a non-GAAP basis, gross margin was 35.0%, up from 33.2% in the prior quarter. Gross margin increased due to improved factory utilization and the elimination of inefficiencies associated with high sequential revenue growth in the second quarter.
Operating expenses for the third quarter of 2009 were $47.7 million, or 27.6% of revenue. Non-GAAP operating expenses for the quarter were $44.8 million or 25.9% of revenue.
Inventory turns remained consistent at 5.1 while DSO improved slightly to 53 days. Cash, cash equivalents, and investments increased to $134.6 million as of September 26, 2009.
Outlook:
The Company estimates that fourth quarter 2009 revenue will be between $175 million and $185 million. Non-GAAP gross margin is expected to be between 35% and 37% and non-GAAP operating expenses are expected to be between $46 million to $48 million. Fourth quarter net income is expected to range between $0.07 and $0.09 per share and non-GAAP net income is expected to range between $0.10 and $0.12 per share. Cash is expected to increase by about $15 million. As of today the Company is 91% booked to the midpoint of revenue guidance for the fourth quarter.
Additional Information Regarding September 26, 2009 Results:
GAAP and non-GAAP financial measures are presented in the tables below. Non-GAAP financial measures are reconciled to the corresponding GAAP financial measures in the financial statement portion of this press release.
GAAP RESULTS
Three Months Ended Nine Months Ended
Change Change Change
vs. Q2 vs. Q3 vs. Q3
Q3 2009 Q2 2009 2009 Q3 2008 2008 Q3 2009 Q3 2008 2008
Revenue $ 173.0 $ 169.1 2 % $ 186.3 -7 % $ 461.0 $ 424.4 9 %
GM 33.8 % 32.3 % 1.5 % 31.4 % 2.4 % 29.6 % 33.2 % -3.6 %
Op Income (Loss) $ 10.7 $ 4.3 149 % $ 12.3 -13 % $ (1.7 ) $ 17.0 -110 %
Net Income (Loss) $ 10.5 $ 3.9 169 % $ 11.8 -11 % $ (1.2 ) $ 19.7 -106 %
Diluted EPS $ 0.07 $ 0.03 $ 0.04 $ 0.08 $ (0.01 ) $ (0.01 ) $ 0.13 $ (0.14 )
NON-GAAP RESULTS A
Three Months Ended Nine Months Ended
Change Change Change
vs. Q2 vs. Q3 vs. Q3
Q3 2009 Q2 2009 2009 Q3 2008 2008 Q3 2009 Q3 2008 2008
Revenue $ 173.0 $ 169.1 2 % $ 186.3 -7 % $ 461.0 $ 424.4 9 %
GM 35.0 % 33.2 % 1.8 % 33.0 % 2.0 % 30.7 % 34.9 % -4.2 %
Op Income (Loss) $ 15.8 $ 11.7 35 % $ 17.5 -10 % $ 15.2 $ 30.8 -51 %
Net Income (Loss) $ 15.7 $ 11.5 37 % $ 17.1 -8 % $ 16.2 $ 33.5 -52 %
Diluted EPS $ 0.10 $ 0.08 $ 0.02 $ 0.12 $ (0.02 ) $ 0.11 $ 0.23 $ (0.12 )
AExcludes stock based compensation charges, a charge
for an expected settlement of a lawsuit and certain charges
associated with acquisitions.
Conference Call:
TriQuint will host a conference call this afternoon at 2:00 p.m. PDT to discuss the results for the quarter as well as our future expectations for the Company. To access the conference call, investors may dial (888) 813-6582 domestically or (706) 643-7082 internationally approximately ten minutes prior to the invitation of the teleconference using passcode 27063245. The call can also be heard via webcast accessed through the "Investors" section of TriQuint's web site: www.triquint.com, or through www.Vcall.com. A replay will be available for 7 days by dialing (706) 645-9291, passcode 27063245.
Non-GAAP Financial Measures:
This press release provides financial measures for net income, diluted earnings per share, gross margin, operating expenses and operating income that exclude equity compensation expense, a charge for the anticipated settlement of a lawsuit, and certain charges associated with acquisitions, and are therefore not calculated in accordance with accounting principles generally accepted in the United States ("GAAP"). Management believes that these non-GAAP financial measures provide meaningful supplemental information regarding our performance that enhances management's and investors' ability to evaluate TriQuint's operating results.
Forward-Looking Statements:
This press release contains forward-looking statements made pursuant to the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements include statements regarding the clearance of excess inventory in the WLAN market, TriQuint's anticipated net income/(loss) and revenues, expected non-GAAP gross margins, operating expenses and net income and expected cash levels. Actual results may vary materially from those expressed or implied in the statements herein or from historical results, due to changes in economic, business, competitive, technological and/or regulatory factors, including TriQuint's performance; demand for TriQuint's products; ability to develop new products, improve yields, maintain product pricing and reduce costs; ability to win customers, increase our market share and continue to provide expected levels of inventory to customers; inventory levels in our markets and market conditions. Additional considerations and important risk factors are described in TriQuint's reports on Form 10-K and 10-Q and other filings with the Securities and Exchange Commission. These reports can be accessed at the SEC web site, www.sec.gov. Except as required by law, we undertake no obligation to revise or publicly release the results of any revision to these forward-looking statements.
A reader of this release should understand that it is not possible to predict or identify all risk factors and should not consider the list to be a complete statement of all potential risks and uncertainties.
Facts About TriQuint
Founded in 1985, we "Connect the Digital World to the Global Network"(R) by supplying high-performance RF modules, components and foundry services to the world's leading communications companies. Specifically, TriQuint supplies products to four out of the top five mobile phone manufacturers, and is a leading gallium arsenide (GaAs) supplier to major defense and space contractors. TriQuint creates standard and custom products using advanced processes that include gallium arsenide, surface acoustic wave (SAW) and bulk acoustic wave (BAW) technologies to serve diverse markets including wireless handsets, laptops, GPS/PND, base stations, broadband communications and military. TriQuint is also the lead researcher in a multi-year DARPA program to develop advanced gallium nitride (GaN) amplifiers. TriQuint, as named by Strategy Analytics(1), is the number-three worldwide leader in GaAs devices and the world's largest commercial GaAs foundry. TriQuint has ISO9001 certified manufacturing facilities in Oregon, Texas, and Florida and a production plant in Costa Rica; design centers are located in North America and Germany. Visit TriQuint at www.triquint.com/rf to receive new product information and to register for our newsletters.
(1) Announced February 2009 and May 2009, respectively.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In thousands)
September 26, June 27, December 31,
2009 2009 2008
Assets
Current assets:
Cash, cash equivalents and investments $ 134,608 $ 99,430 $ 86,077
Accounts receivable, net 100,399 107,319 78,419
Inventories 91,293 88,226 108,260
Other current assets 24,773 25,471 23,399
Total current assets 351,073 320,446 296,155
Property, plant and equipment, net 268,517 265,066 264,250
Other, net 47,025 39,373 57,972
Total assets $ 666,615 $ 624,885 $ 618,377
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable and accrued expenses $ 77,889 $ 64,193 $ 56,556
Other accrued liabilities 18,217 14,562 12,775
Total current liabilities 96,106 78,755 69,331
Long term income tax liability 9,871 9,714 10,676
Other long-term liabilities 10,820 10,336 12,294
Total liabilities 116,797 98,805 92,301
Stockholders' equity 549,818 526,080 526,076
Total liabilities and stockholders' equity $ 666,615 $ 624,885 $ 618,377
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(In thousands, except per share amounts)
Three Months Ended Nine Months Ended
September 26, June 27, September 27, September 26, September 27,
2009 2009 2008 2009 2008
Revenues $ 172,955 $ 169,063 $ 186,347 $ 460,965 $ 424,442
Cost of goods sold 114,513 114,492 127,787 324,654 283,521
Gross profit 58,442 54,571 58,560 136,311 140,921
Operating expenses:
Research, development and engineering 28,282 27,467 25,234 78,971 66,841
Selling, general and administrative 19,408 19,851 21,148 56,067 56,187
In-process research and development - - - - 1,400
Settlement of lawsuit - 2,950 - 2,950 -
Loss (gain) on disposal of equipment 14 4 (101 ) 22 (518 )
Total operating expenses 47,704 50,272 46,281 138,010 123,910
Operating income (loss) 10,738 4,299 12,279 (1,699 ) 17,011
Other (expense) income:
Interest income 139 199 603 677 3,719
Interest expense (179 ) (224 ) (134 ) (721 ) (148 )
Foreign currency gain (loss) 60 (38 ) 136 (54 ) 715
Recovery of investment - - - - 105
Other, net 9 53 19 439 38
Other income (expense), net 29 (10 ) 624 341 4,429
Income (loss) before income tax 10,767 4,289 12,903 (1,358 ) 21,440
Income tax expense (benefit) 256 386 1,060 (126 ) 1,753
Net income (loss) $ 10,511 $ 3,903 $ 11,843 $ (1,232 ) $ 19,687
.
Per Share Data
Basic per share net income (loss) $ 0.07 $ 0.03 $ 0.08 $ (0.01 ) $ 0.14
Diluted per share net income (loss) $ 0.07 $ 0.03 $ 0.08 $ (0.01 ) $ 0.13
Weighted-average shares outstanding:
Basic 150,878 148,063 145,029 148,789 143,897
Diluted 157,344 149,882 148,082 148,789 146,835
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
Three Months Ended Nine Months Ended
September 26, June 27, September 27, September 26, September 27,
2009 2009 2008 2009 2008
Revenues 100.0 % 100.0 % 100.0 % 100.0 % 100.0 %
Cost of goods sold 66.2 % 67.7 % 68.6 % 70.4 % 66.8 %
Gross profit 33.8 % 32.3 % 31.4 % 29.6 % 33.2 %
Operating expenses:
Research, development and engineering 16.4 % 16.3 % 13.5 % 17.1 % 15.7 %
Selling, general and administrative 11.2 % 11.8 % 11.3 % 12.2 % 13.2 %
In-process research and development - - - - 0.3 %
Settlement of lawsuit - 1.7 % - 0.6 % -
Loss (gain) on disposal of equipment 0.0 % 0.0 % -0.1 % 0.0 % -0.1 %
Total operating expenses 27.6 % 29.8 % 24.7 % 29.9 % 29.1 %
Operating income (loss) 6.2 % 2.5 % 6.7 % -0.3 % 4.1 %
Other income (expense):
Interest income 0.1 % 0.1 % 0.3 % 0.1 % 0.9 %
Interest expense -0.1 % -0.1 % -0.1 % -0.2 % -0.0 %
Foreign currency gain (loss) 0.0 % -0.0 % 0.1 % -0.0 % 0.2 %
Recovery of investment - - - - 0.0 %
Other, net 0.0 % 0.0 % 0.0 % 0.1 % 0.0 %
Other income (expense), net 0.0 % -0.0 % 0.3 % 0.0 % 1.1 %
Income (loss) before income tax 6.2 % 2.5 % 7.0 % -0.3 % 5.2 %
Income tax expense (benefit) 0.1 % 0.2 % 0.6 % -0.0 % 0.4 %
Net income (loss) 6.1 % 2.3 % 6.4 % -0.3 % 4.8 %
SUPPLEMENTAL RECONCILIATION OF GAAP TO NON-GAAP RESULTS
(Unaudited)
(In thousands, except per share amounts)
Three Months Ended Nine Months Ended
September 26, 2009 June 27, 2009 September 27, 2008 September 26, 2009 September 27, 2008
(% of revenues) (% of revenues) (% of revenues) (% of revenues) (% of revenues)
GAAP GROSS PROFIT $ 58,442 33.8 % $ 54,571 32.3 % $ 58,560 31.4 % $ 136,311 29.6 % $ 140,921 33.2 %
Adjustment for equity compensation charges 1,268 0.7 % 614 0.4 % 1,163 0.6 % 2,531 0.5 % 3,248 0.7 %
Adjustment for charges associated with acquisitions
Amortization of intangible assets 869 0.5 % 793 0.5 % 814 0.5 % 2,471 0.5 % 1,086 0.4 %
Increase in value of inventory - 0.0 % 85 0.0 % 966 0.5 % 338 0.1 % 2,672 0.6 %
NON-GAAP GROSS PROFIT $ 60,579 35.0 % $ 56,063 33.2 % 61,503 33.0 % $ 141,651 30.7 % $ 147,927 34.9 %
GAAP OPERATING EXPENSES $ 47,704 27.6 % $ 50,272 29.8 % 46,281 24.7 % $ 138,010 29.9 % $ 123,910 29.1 %
Adjustment for equity compensation charges (2,702 ) -1.6 % (2,780 ) -1.7 % (2,064 ) -1.0 % (7,978 ) -1.7 % (5,156 ) -1.2 %
Adjustment for settlement of lawsuit - 0.0 % (2,950 ) -1.7 % - 0.0 % (2,950 ) -0.6 % - 0.0 %
Adjustment for charges associated with acquisitions
Amortization of intangible assets (214 ) -0.1 % (202 ) -0.2 % (205 ) -0.1 % (621 ) -0.1 % (273 ) -0.1 %
In-process research and development - 0.0 % - 0.0 % - 0.0 % - 0.0 % (1,400 ) -0.3 %
NON-GAAP OPERATING EXPENSES $ 44,788 25.9 % $ 44,340 26.2 % 44,012 23.6 % $ 126,461 27.4 % $ 117,081 27.5 %
GAAP OPERATING INCOME (LOSS) $ 10,738 6.2 % $ 4,299 2.5 % 12,279 6.7 % $ (1,699 ) -0.3 % $ 17,011 4.1 %
Adjustment for equity compensation charges 3,970 2.3 % 3,394 2.1 % 3,227 1.7 % 10,508 2.3 % 8,404 1.9 %
Adjustment for settlement of lawsuit - 0.0 % 2,950 1.7 % - 0.0 % 2,950 0.6 % - 0.0 %
Adjustment for charges associated with acquisitions 1,083 0.6 % 1,080 0.7 % 1,985 1.1 % 3,430 0.7 % 5,431 1.4 %
NON-GAAP OPERATING INCOME $ 15,791 9.1 % $ 11,723 7.0 % 17,491 9.5 % $ 15,189 3.4 % $ 30,846 7.4 %
GAAP NET INCOME (LOSS) $ 10,511 6.1 % $ 3,903 2.3 % 11,843 6.4 % $ (1,232 ) -0.3 % $ 19,687 4.8 %
Adjustment for equity compensation charges 3,970 2.3 % 3,394 2.1 % 3,227 1.7 % 10,508 2.3 % 8,404 1.9 %
Adjustment for settlement of lawsuit - 0.0 % 2,950 1.7 % - 0.0 % 2,950 0.6 % - 0.0 %
Adjustment for charges associated with acquisitions 1,207 0.7 % 1,251 0.7 % 1,985 1.1 % 3,991 0.8 % 5,431 1.4 %
NON-GAAP NET INCOME $ 15,688 9.1 % $ 11,498 6.8 % 17,055 9.2 % $ 16,217 3.5 % $ 33,522 8.1 %
GAAP DILUTED EARNINGS (LOSS) PER SHARE $ 0.07 $ 0.03 $ 0.08 $ (0.01 ) $ 0.13
Adjustment for equity compensation charges 0.02 0.02 0.02 0.07 0.06
Adjustment for settlement of lawsuit - 0.02 - 0.02 -
Adjustment for charges associated with acquisitions 0.01 0.01 0.02 0.03 0.04
NON-GAAP DILUTED EARNINGS PER SHARE $ 0.10 $ 0.08 $ 0.12 $ 0.11 $ 0.23
GAAP COMMON SHARES ASSUMING DILUTION $ 157,344 $ 149,882 $ 148,082 $ 148,789 $ 146,835
Adjustment for equity compensation charges 1,691 1,103 20 950 63
COMMON SHARES ASSUMING DILUTION EXCLUDING EQUITY COMPENSATION $ 159,035 $ 150,985 $ 148,102 $ 149,739 $ 146,898
SOURCE: TriQuint Semiconductor, Inc
TriQuint Semiconductor, Inc Steve Buhaly VP of Finance & Administration, CFO +1-503-615-9401 sbuhaly@tqs.com or Fi. Comm Heidi A. Flannery Investor Relations Counsel +1-541-322-0230 heidi.flannery@ficomm.com or Media Contact: TriQuint Semiconductor, Inc. Brandi Frye Director, Marketing Comms +1-503-615-9488 bfrye@tqs.com
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