SANTA CLARA, Calif., May 06, 2016 (GLOBE NEWSWIRE) -- MoSys, Inc. (NASDAQ:MOSY), a leader in semiconductor
solutions that enable fast, intelligent data access for network and communications systems, today reported financial results for
the first quarter ended March 31, 2016.
First Quarter Overview
- Shipped Bandwidth Engine® 2 in production volumes to multiple customers;
- Demonstrated Bandwidth Engine 3 interoperability with industry-leading FPGA devices that target next-generation networking
and data center systems;
- Introduced and demonstrated new members of the LineSpeed™ Flex 100G PHY product family with extended reach capability;
and
- Launched new MoSys® Programmable Search Engine product family that allows customers to develop optimal
user-defined search functions for 100G and higher networking systems.
“First quarter revenue reflects continued ramping of Bandwidth Engine shipments to multiple customers, including
our Tier 1 customer to whom we shipped the first deliveries from scheduled 2016 backlog,“ commented Len Perham, president and CEO
of MoSys. “We secured additional design wins for both our Bandwidth Engine and LineSpeed product lines with new customers, as we
continue to expand our customer base. While our expected 2016 revenue ramp will be driven by current production products, we
continue to sample our LineSpeed Flex products and have received strong interest in our Bandwidth Engine 3 and recently announced
Programmable Search Engine products, all of which provide opportunities for future growth.”
Mr. Perham continued, “During the quarter, we began to benefit from our restructuring and other cost reduction
initiatives, which realigned resources and expenses while maintaining customer support and core product development activity. 2016
is a pivotal year for MoSys, as we strive to increase revenue, expand our product portfolio, add to our design win base, reduce
costs and win additional new customers. We anticipate Bandwidth Engine 2 being our primary revenue driver during 2016 as more
design wins ramp into production. Although still early in the year, we are encouraged by the progress towards our goals and expect
to gain additional momentum throughout the remainder of the year.”
Total net revenue for the first quarter of 2016 was $1.5 million, compared with $1.6 million in the previous
quarter and $0.8 million in the first quarter of 2015. Product revenue in the first quarter was $1.1 million, consistent with the
fourth quarter of 2015 and compared with $0.2 million in the year ago period. Royalty and other revenue for the first quarter of
2016 was $0.3 million, compared with $0.5 million in the previous quarter and $0.6 million in the first quarter of 2015.
Gross margin for the first quarter of 2016 was 41 percent, compared with 45 percent in the fourth quarter of
2015 and 69 percent for the first quarter of 2015. The sequential decrease in gross margin was primarily due to reduced royalty
revenue.
Total operating expenses on a GAAP basis for the first quarter of 2016 were $7.4 million, compared with $7.2
million in the fourth quarter of 2015 and $8.5 million in the year-ago period. First quarter 2016 operating expenses included a
one-time restructuring charge of $0.7 million and stock-based compensation and amortization of intangible assets expenses of $0.6
million.
GAAP net loss for the first quarter of 2016 was $6.9 million, or ($0.10) per share, including the restructuring
charges, stock-based compensation and amortization expenses. This compares with a net loss of $6.5 million, or ($0.10) per
share, in the previous quarter and a net loss of $8.0 million, or ($0.15) per share, for the first quarter of 2015. Non-GAAP net
loss for the first quarter of 2016 was $5.6 million, or ($0.08) per share, which excludes the restructuring charges, amortization
of intangible assets and stock-based compensation expense. Earnings per share for the first quarter of 2016 were computed using
approximately 65.7 million weighted shares on a GAAP and non-GAAP basis. A reconciliation of GAAP results to non-GAAP results is
provided in the financial statement tables following the text of this press release.
As of March 31, 2016, cash and investments totaled $20.9 million, which included $7.9 million in net cash
proceeds from the Company’s first quarter sale of 10% Senior Secured Convertible Notes in a private placement transaction.
Financial Results Webcast / Conference Call
MoSys will host a conference call and webcast with investors today at 5:30 a.m. Pacific Time (8:30 a.m. Eastern Time) to discuss
the first quarter 2016 financial results. Investors and other interested parties may access the call by dialing
1-855-779-0042 in the U.S. (+1-631-485-4856 outside of the U.S.) and entering the pass code
89160146 at least 10 minutes prior to the start of the call. In addition, an audio webcast will be available
through the MoSys Web site at http://www.mosys.com. A telephone replay will be available
for two business days following the call at 1-855-859-2056 in the U.S. (+1-404-537-3406 outside of the U.S.), pass code of
89160146.
Use of Non-GAAP Financial Measures
To supplement MoSys’ consolidated financial statements presented in accordance with GAAP, MoSys uses non-GAAP financial measures
that exclude from the statement of operations the effects of stock-based compensation, amortization of recorded intangible assets
and restructuring charges. MoSys’ management believes that the presentation of these non-GAAP financial measures is useful to
investors and other interested persons because they are one of the primary indicators that MoSys’ management uses for planning and
forecasting future performance. MoSys’ management believes that the presentation of non-GAAP financial measures that exclude these
items is useful to investors because management does not consider these charges part of the day-to-day business or reflective of
the core operational activities of the Company that are within the control of management or that would be used to evaluate
management’s operating performance.
Investors are encouraged to review the reconciliation of these non-GAAP financial measures to the comparable
GAAP results, which is provided in a table below the Condensed Consolidated Statements of Operations. The non-GAAP financial
measures disclosed by the Company should not be considered a substitute for, or superior to, financial measures calculated in
accordance with GAAP, and the financial results calculated in accordance with GAAP and reconciliations to those financial
statements should be carefully evaluated. The non-GAAP financial measures used by the Company may be calculated differently from,
and therefore may not be comparable to, similarly titled measures used by other companies. For additional information regarding
these non-GAAP financial measures, and management’s explanation of why it considers such measures to be useful, refer to the Form
8-K dated May 6, 2016, that the Company filed with the Securities and Exchange Commission.
Forward-Looking Statements
This press release may contain forward-looking statements about the Company, including, without limitation, anticipated benefits
and performance expected from our IC products and the Company’s future markets and future business prospects. Forward-looking
statements are based on certain assumptions and expectations of future events that are subject to risks and uncertainties. Actual
results and trends may differ materially from historical results or those projected in any such forward-looking statements
depending on a variety of factors. These factors include, but are not limited, to the following:
- achieving additional IC design wins;
- commencing volume shipments of Bandwidth Engine ICs;
- the timing of customer orders and product shipments;
- our ability to enhance our existing proprietary technologies and develop new technologies;
- achieving necessary acceptance and adoption of our IC architecture and interface protocols by potential customers and their
suppliers;
- difficulties and delays in the development, production, testing and marketing of our ICs;
- reliance on our manufacturing partners to assist successfully with the fabrication of our ICs;
- availability of quantities of ICs supplied by our manufacturing partners at a competitive cost;
- our lack of recent experience as a fabless semiconductor company making and selling proprietary ICs;
- level of intellectual property protection provided by our patents, the expenses and other consequences of litigation,
including intellectual property infringement litigation, to which we may be or may become a party from time to time;
- vigor and growth of markets served by our customers and our operations; and
other risks identified in the Company’s most recent report on Form 10-K filed with the Securities and Exchange
Commission, as well as other reports that MoSys files from time to time with the Securities and Exchange Commission. MoSys
undertakes no obligation to update publicly any forward-looking statement for any reason, except as required by law, even as new
information becomes available or other events occur in the future.
About MoSys, Inc.
MoSys, Inc. (NASDAQ:MOSY) is a fabless semiconductor company enabling leading equipment manufacturers in the networking and
communications systems markets to address the continual increase in Internet users, data and services. The Company’s solutions
deliver data path connectivity, speed and intelligence while eliminating data access bottlenecks on line cards and systems scaling
from 100G to multi-terabits per second. Engineered and built for high-reliability carrier and enterprise applications, MoSys'
Bandwidth Engine® and LineSpeed™ IC product families are based on the Company's patented high-performance, high-density
intelligent access and high-speed serial interface technology, and utilize the Company's highly efficient GigaChip®
Interface. MoSys is headquartered in Santa Clara, California. More information is available at www.mosys.com.
Bandwidth Engine, GigaChip and MoSys are registered trademarks of MoSys, Inc. in the US and/or other
countries. LineSpeed and the MoSys logo are trademarks of MoSys, Inc. All other marks mentioned herein are the property of their
respective owners.
(Financial Tables to Follow)
MOSYS, INC. |
CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS |
(In thousands, except per share amounts;
unaudited) |
|
|
Three Months Ended |
|
March 31, |
|
|
2016 |
|
|
2015 |
|
|
|
|
Net Revenue |
|
|
Product |
$ |
1,120 |
|
$ |
180 |
|
Royalty and other |
|
331 |
|
|
596 |
|
Total net revenue |
|
1,451 |
|
|
776 |
|
|
|
|
Cost of Net Revenue |
|
863 |
|
|
237 |
|
|
|
|
Gross Profit |
|
588 |
|
|
539 |
|
|
|
|
Operating Expenses |
|
|
Research and development |
|
5,232 |
|
|
6,893 |
|
Selling, general and administrative |
|
1,516 |
|
|
1,614 |
|
Restructuring charges |
|
676 |
|
|
- |
|
Total operating expenses |
|
7,424 |
|
|
8,507 |
|
|
|
|
Loss from operations |
|
(6,836 |
) |
|
(7,968 |
) |
|
|
|
Other income/(expense), net |
|
(9 |
) |
|
23 |
|
Loss before income taxes |
|
(6,845 |
) |
|
(7,945 |
) |
|
|
|
Income tax provision |
|
20 |
|
|
20 |
|
|
|
|
Net Loss |
$ |
(6,865 |
) |
$ |
(7,965 |
) |
|
|
|
Net loss per share |
|
|
Basic and diluted |
$ |
(0.10 |
) |
$ |
(0.15 |
) |
|
|
|
Shares used in computing net loss per share |
|
|
Basic and diluted |
|
65,675 |
|
|
54,282 |
|
|
|
|
|
|
|
MOSYS, INC. |
CONDENSED CONSOLIDATED BALANCE
SHEETS |
(In thousands, unaudited) |
|
|
|
|
March 31, |
December 31, |
|
|
2016 |
|
|
2015 |
|
|
|
|
Assets |
|
|
Current assets: |
|
|
Cash, cash equivalents and investments |
$ |
20,885 |
|
$ |
20,238 |
|
Accounts receivable, net |
|
798 |
|
|
729 |
|
Inventories |
|
1,468 |
|
|
1,597 |
|
Prepaid expenses and other |
|
903 |
|
|
701 |
|
Total current assets |
|
24,054 |
|
|
23,265 |
|
|
|
|
Property and equipment, net |
|
1,567 |
|
|
1,630 |
|
Goodwill |
|
23,134 |
|
|
23,134 |
|
Intangible assets, net |
|
306 |
|
|
334 |
|
Other assets |
|
440 |
|
|
329 |
|
Total assets |
$ |
49,501 |
|
$ |
48,692 |
|
|
|
|
Liabilities and Stockholders’ Equity |
|
|
Current liabilities: |
|
|
Accounts payable |
$ |
358 |
|
$ |
940 |
|
Accrued expenses and other |
|
2,225 |
|
|
2,664 |
|
Total current liabilities |
|
2,583 |
|
|
3,604 |
|
|
|
|
Notes payable |
|
7,879 |
|
|
- |
|
Other long-term liabilities |
|
245 |
|
|
247 |
|
Total liabilities |
|
10,707 |
|
|
3,851 |
|
|
|
|
Stockholders' equity |
|
38,794 |
|
|
44,841 |
|
|
|
|
Total liabilities and stockholders’ equity |
$ |
49,501 |
|
$ |
48,692 |
|
|
|
|
|
|
|
MOSYS, INC. |
Reconciliation of GAAP to Non-GAAP Net Loss
and Net Loss Per Share |
(In thousands, except per share amounts;
unaudited) |
|
|
|
|
Three Months Ended |
|
March 31, |
|
|
2016 |
|
|
2015 |
|
|
|
|
GAAP net loss |
$ |
(6,865 |
) |
$ |
(7,965 |
) |
Stock-based compensation expense |
|
|
- Research and development |
|
438 |
|
|
966 |
|
- Selling, general and administrative |
|
167 |
|
|
261 |
|
Total stock-based compensation expense |
|
605 |
|
|
1,227 |
|
|
|
|
Restructuring charges |
|
676 |
|
|
- |
|
Amortization of intangible assets |
|
28 |
|
|
237 |
|
|
|
|
Non-GAAP net loss |
$ |
(5,556 |
) |
$ |
(6,501 |
) |
|
|
|
GAAP net loss per share |
$ |
(0.10 |
) |
$ |
(0.15 |
) |
Reconciling items |
|
|
- Stock-based compensation expense |
|
0.01 |
|
|
0.02 |
|
- Restructuring charges |
|
0.01 |
|
|
- |
|
- Amortization of intangible assets |
|
- |
|
|
0.01 |
|
|
|
|
Non-GAAP net loss per share: basic and diluted |
$ |
(0.08 |
) |
$ |
(0.12 |
) |
|
|
|
Shares used in computing non-GAAP net loss per share |
|
|
|
|
Basic and diluted |
|
65,675 |
|
|
54,282 |
|
Contacts: Jim Sullivan, CFO MoSys, Inc. +1 (408) 418-7500 jsullivan@mosys.com Beverly Twing, Sr. Acct. Manager Shelton Group, Investor Relations +1 (214) 272-0089 btwing@sheltongroup.com