Audience has provided these measures in addition to GAAP financial results because management believes these non-GAAP measures help provide a consistent basis for comparison between quarters and annual growth rates that are not influenced by certain non-cash charges and therefore are helpful in understanding Audience's underlying operating results. These non-GAAP measures are some of the primary measures Audience's management uses for planning and forecasting. These measures are not in accordance with, or an alternative to, GAAP and these non-GAAP measures may not be comparable to information provided by other companies. Reconciliations of the GAAP to non-GAAP results are presented at the end of this press release.
Cautionary Note Concerning Forward-Looking Statements
Statements in the press release and certain matters to be discussed on the fourth quarter conference call regarding Audience, Inc., which are not historical facts, are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements may be identified by terms such as believe, expect, may, will, provide, could and should and the negative of these terms or other similar expressions. These statements, including statements relating to expectations of adoption of Audience's latest generation Advanced Voice and Continuous VoiceQ activation capabilities by ZTE, Meizu and Coolpad and adoption of Audience's motion and sensor technologies, future revenue, net income and operating margin performance, future success for various products and our leadership position in the market, and the demand for our solutions including continued demand by customers upon whom we are substantially dependent, are based on current expectations and assumptions that are subject to risks and uncertainties. Our actual results could differ materially from those we anticipate as a result of various factors, including: completion of our December 31, 2014 audit by our independent auditors, and potential fluctuations in the company's quarterly and annual operating results and financial condition, including but not limited to matters related to tax; our dependence on a single OEM, Samsung Electronics Co. Ltd., for a substantial portion of our revenue; weak demand for high end smartphones integrating our products and the impact on our business; our need to maintain and expand our existing relationships with our OEMs, including Samsung and leading Chinese OEMs, and to establish relationships with new OEMs in order to maintain and increase our revenue; our ability to sustain profitable operations due to our history of losses and accumulated deficit; quarterly fluctuations in our results due to factors such as the timing of OEM product launches and customer purchasing behavior in light of anticipated mobile phone launches; our assessments of whether we have excess or obsolete inventory; increasing competition and new entrants in the market for our products; our need to diversify our sources of revenue; our ability to successfully integrate Sensor Platforms' team and technology; our ability to enter new end user product markets, as well as new geographic markets; pressure on the average selling prices for our products; our lengthy sales cycle and the lack of certainty as to whether any given OEM's products will achieve market acceptance; our OEMs' lengthy and expensive process to qualify our products; our ability to develop new or enhanced products, including codecs, Advanced Voice and Continuous VoiceQ products, in a timely manner that achieve market acceptance; our reliance on third parties to manufacture, assemble and test our products; increased defects that may be present in our products as we scale our manufacturing processes; the impact of future intellectual property litigation and claims for indemnification; changes in tax laws or our ability to utilize our tax structure and net operating losses and other risks inherent in fabless semiconductor businesses. For a discussion of these and other related risks, please refer to "Risk Factors" in our most recent Quarter Report on Form 10-Q for the three months ended September 30, 2014, which is available on the SEC's website at
www.sec.gov. Given these uncertainties, you should not place undue reliance on these forward-looking statements. Also, forward-looking statements represent our management's beliefs and assumptions only as of the date made. You should review our SEC filings carefully and with the understanding that our actual future results may be materially different from what we expect.
Except as required by law, we assume no obligation to update these forward-looking statements, or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future.
Audience, Inc.
Condensed Consolidated Balance Sheets
(in thousands)
December 31, December 31,
2014 2013 (1)
------------------ ------------------
(unaudited)
Assets
Current assets:
Cash and cash equivalents $ 46,184 $ 124,691
Short-term investments 8,999 14,855
Restricted cash 4,200 170
Accounts receivable, net 2,789 5,670
Inventories 27,999 13,422
Prepaid expenses and other current
assets 3,880 4,676
------------------ ------------------
Total current assets 94,051 163,484
Property and equipment, net 11,634 13,533
Intangibles assets, net 6,317 -
Other noncurrent assets 2,840 2,402
------------------ ------------------
Total assets $ 114,842 $ 179,419
================== ==================
Liabilities and stockholders' equity
Current liabilities:
Accounts payable $ 1,582 $ 6,304
Accrued and other current
liabilities 12,064 10,673
Deferred credits and income 725 265
------------------ ------------------
Total current liabilities 14,371 17,242
Income taxes payable - noncurrent 1,114 935
Other liabilities - noncurrent 2,074 1,861
------------------ ------------------
Total liabilities 17,559 20,038
------------------ ------------------
Stockholders' equity:
Common stock 23 22
Additional paid-in capital 195,351 183,840
Accumulated other comprehensive
income (loss) - (1)
Accumulated deficit (98,091) (24,480)
------------------ ------------------
Total stockholders' equity 97,283 159,381
------------------ ------------------
Total liabilities and stockholders'
equity $ 114,842 $ 179,419
================== ==================
Note 1: The condensed consolidated balance sheet has been derived from
audited consolidated financial statements.
Audience, Inc.
Condensed Consolidated Statements of Operations
(in thousands, except per share data)
Three months ended Twelve months ended
December 31, December 31,
------------------------ ------------------------
2014 2013 2014 2013 (1)
----------- ----------- ----------- -----------
(unaudited) (unaudited) (unaudited)
Revenue:
Hardware $ 15,037 $ 31,109 $ 104,123 $ 150,010
Licensing 2,171 2,032 9,217 10,121
----------- ----------- ----------- -----------
Total revenue 17,208 33,141 113,340 160,131
Cost of revenue 10,129 15,806 56,572 71,267
----------- ----------- ----------- -----------
Gross profit 7,079 17,335 56,768 88,864
Operating expenses:
Research and development 11,468 11,958 50,613 43,256
Selling, general and
administrative 9,581 10,279 46,153 41,346
Impairment of goodwill
and intangible assets 31,336 - 31,336 -
----------- ----------- ----------- -----------
Total operating expenses 52,385 22,237 128,102 84,602
----------- ----------- ----------- -----------
Income (loss) from
operations (45,306) (4,902) (71,334) 4,262
Interest income, net 5 29 38 157
Other expense, net (201) (71) (347) (280)
----------- ----------- ----------- -----------
Income (loss) before
income taxes (45,502) (4,944) (71,643) 4,139
Income tax provision
(benefit) 15 (2,023) 1,968 2,069
----------- ----------- ----------- -----------
Net income (loss) (45,517) $ (2,921) $ (73,611) $ 2,070
=========== =========== =========== ===========
Net income (loss) per
share:
Basic $ (1.96) $ (0.13) $ (3.25) $ 0.10
=========== =========== =========== ===========
Diluted $ (1.96) $ (0.13) $ (3.25) $ 0.09
=========== =========== =========== ===========
Weighted average shares
used in computing net
income (loss) per share:
Basic 23,173 22,012 22,683 21,467
=========== =========== =========== ===========
Diluted 23,173 22,012 22,683 23,197
=========== =========== =========== ===========
Note 1: The condensed consolidated statement of operations has been derived
from audited consolidated financial statements.
Audience, Inc.
Computation of GAAP net income (loss) per share
(in thousands, except for per share amounts)
Three months ended Twelve months ended
December 31, December 31,
------------------------ ------------------------
2014 2013 2014 2013 (1)
----------- ----------- ----------- -----------
(unaudited) (unaudited) (unaudited)
Computation of GAAP net
income (loss) per share:
GAAP net income (loss) $ (45,517) $ (2,921) $ (73,611) $ 2,070
=========== =========== =========== ===========
Weighted average shares
used in computing net
income (loss) per share:
Basic 23,173 22,012 22,683 21,467
=========== =========== =========== ===========
Diluted 23,173 22,012 22,683 23,197
=========== =========== =========== ===========
Net income (loss) per
share:
Basic $ (1.96) $ (0.13) $ (3.25) $ 0.10
=========== =========== =========== ===========
Diluted $ (1.96) $ (0.13) $ (3.25) $ 0.09
=========== =========== =========== ===========
Note 1: The computation of GAAP net income (loss) per share has been derived
from audited consolidated financial statements.
