Total revenue for the second quarter of 2016 was $2.72 million, representing a decrease of 8% compared to $2.95 million in the first quarter of 2016 and a decrease of 45% compared to $4.97 million in the second quarter of 2015. New product revenue for the second quarter of 2016 was $1.20 million, a decrease of 20% compared to $1.49 million in the first quarter of 2016 and a decrease of 59% compared to $2.95 million in the second quarter of 2015. During the second quarter of 2016, mature product revenue was $1.52 million, an increase of 4% compared to $1.46 million sequentially and a decrease of 25% compared to $2.02 million in the second quarter of 2015. New product revenue accounted for 44% of the total revenue in the second quarter of 2016 compared to 51% in the first quarter of 2016 and 59% in the second quarter of 2015.
Under generally accepted accounting principles in the United States of America (GAAP), the net loss for the second quarter of 2016 was $5.57 million, or $0.08 per share, compared to a net loss of $5.09 million, or $0.09 per share in the first quarter of 2016 and a net loss of $4.28 million, or $0.08 per share, in the second quarter of 2015. Non-GAAP net loss for the second quarter of 2016 was $4.82 million, or $0.07 per share, compared to a non-GAAP net loss of $4.53 million, or $0.08 per share in the first quarter of 2016 and a non-GAAP net loss of $3.62 million, or $0.06 per share, in the second quarter of 2015.
GAAP and Non-GAAP cost of goods (COGS) for three and six months period ended July 3, 2016, include an inventory reserve of $203,000 for PolarPro III product. This reserve had an impact of 7.5% and 3% on gross margins for the three and six months period ended July 3, 2016. GAAP research and development (R&D) costs include a fixed asset write down of $312,000. This write down was eliminated in the presentation of non-GAAP consolidated statement of operation in the three and six months period ended July 3, 2016. The Impact of the write down on the earnings per share for the three and six months period ended July 3, 2016 was not material.
Conference Call
QuickLogic Corporation (
About QuickLogic
QuickLogic Corporation (
Non-GAAP Financial Measures
QuickLogic reports financial information in accordance with GAAP, but believes that non-GAAP financial measures are helpful in evaluating its operating results and comparing its performance to comparable companies. Accordingly, the Company excludes charges related to stock-based compensation, restructuring, the effect of the write-off of long-lived assets and the tax effect on other comprehensive income in calculating non-GAAP (i) income (loss) from operations, (ii) net income (loss), (iii) net income (loss) per share, and (iv) gross margin percentage. The Company provides this non-GAAP information to enable investors to evaluate its operating results in a manner similar to how the Company analyzes its operating results and to provide consistency and comparability with similar companies in the Company's industry.
Management uses the non-GAAP measures, which exclude gains, losses and other charges that are considered by management to be outside of the Company's core operating results, internally to evaluate its operating performance against results in prior periods and its operating plans and forecasts. In addition, the non-GAAP measures are used to plan for the Company's future periods, and serve as a basis for the allocation of the Company's resources, management of operations and the measurement of profit-dependent cash and equity compensation paid to employees and executive officers.
Investors should note, however, that the non-GAAP financial measures used by QuickLogic may not be the same non-GAAP financial measures, and may not be calculated in the same manner, as that of other companies. QuickLogic does not itself, nor does it suggest that investors should, consider such non-GAAP financial measures alone or as a substitute for financial information prepared in accordance with GAAP. A reconciliation of GAAP financial measures to non-GAAP financial measures is included in the financial statements portion of this press release. Investors are encouraged to review the related GAAP financial measures and the reconciliation of non-GAAP financial measures with their most directly comparable GAAP financial measures.
Forward Looking Statements
This press release contains forward-looking statements regarding our future business expectations, which are subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are only predictions and may differ materially from actual results due to a variety of factors including: delays in the market acceptance of the Company's new products; the ability to convert design opportunities into customer revenue; our ability to replace revenue from end-of-life products; the level and timing of customer design activity; the market acceptance of our customers' products; the risk that new orders may not result in future revenue; our ability to introduce and produce new products based on advanced wafer technology on a timely basis; our ability to adequately market the low power, competitive pricing and short time-to-market of our new products; intense competition, including the introduction of new products by competitors; our ability to hire and retain qualified personnel; changes in product demand or supply; capacity constraints; and general economic conditions. These and other potential factors and uncertainties that could cause actual results to differ from the results predicted are described in more detail in the Company's public reports filed with the Securities and Exchange Commission (the "SEC"), including the risks discussed in the "Risk Factors" section in the Company's Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and in the Company's prior press releases, which are available on the Company's Investor Relations website at http://ir.quicklogic.com/and on the SEC website at www.sec.gov. In addition, please note that the date of this press release as August 3, 2016, and any forward-looking statements contained herein are based on assumptions that we believe to be reasonable as of this date. We undertake no obligation to update these statements as a result of new information or future events.
QuickLogic and the QuickLogic logo are registered trademarks of QuickLogic Corporation. All other brands or trademarks are the property of their respective holders and should be treated as such.
QUICKLOGIC CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share amounts)
(Unaudited)
Three Months Ended Six Months Ended
----------------------------- -------------------
July 3, June 28, April 3, July 3, June 28,
2016 2015 2016 2016 2015
-------- --------- -------- -------- ---------
Revenue $ 2,717 $ 4,973 $ 2,950 $ 5,667 $ 11,132
Cost of revenue 1,941 2,830 1,794 3,735 6,110
-------- --------- -------- -------- ---------
Gross profit 776 2,143 1,156 1,932 5,022
Operating expenses:
Research and
development 3,683 3,493 3,447 7,130 6,970
Selling, general and
administrative 2,591 2,690 2,693 5,284 5,650
Restructuring cost -- 169 -- -- 169
-------- --------- -------- -------- ---------
Total operating expense 6,274 6,352 6,140 12,414 12,789
-------- --------- -------- -------- ---------
Loss from operations (5,498) (4,209) (4,984) (10,482) (7,767)
Interest expense (34) (15) (38) (72) (29)
Interest income and
other (expense), net (15) (33) (7) (22) (59)
-------- --------- -------- -------- ---------
Loss before income taxes (5,547) (4,257) (5,029) (10,576) (7,855)
Provision for income
taxes 27 21 64 91 61
-------- --------- -------- -------- ---------
Net loss $ (5,574) $ (4,278) $ (5,093) $(10,667) $ (7,916)
======== ========= ======== ======== =========
Net loss per share:
Basic $ (0.08) $ (0.08) $ (0.09) $ (0.17) $ (0.14)
======== ========= ======== ======== =========
Diluted $ (0.08) $ (0.08) $ (0.09) $ (0.17) $ (0.14)
======== ========= ======== ======== =========
Weighted average shares:
Basic 67,415 56,359 58,371 62,893 56,275
======== ========= ======== ======== =========
Diluted 67,415 56,359 58,371 62,893 56,275
======== ========= ======== ======== =========
QUICKLOGIC CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
(Unaudited)
January 3,
July 3, 2016 2016 (1)
------------- -------------
ASSETS
Current assets:
Cash and cash equivalents $ 18,970 $ 19,136
Accounts receivable, net 1,485 1,601
Inventories 2,318 2,878
Other current assets 983 1,312
------------- -------------
Total current assets 23,756 24,927
Property and equipment, net 3,090 3,315
Other assets 307 219
------------- -------------
TOTAL ASSETS $ 27,153 $ 28,461
============= =============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Trade payables $ 1,537 $ 4,032
Accrued liabilities 1,434 1,482
Current portion of capital lease obligations 142 281
------------- -------------
Total current liabilities 3,113 5,795
Long-term liabilities:
Revolving line of credit 4,000 2,000
Capital lease obligations, less current
portion 109 208
Other long-term liabilities 120 133
------------- -------------
Total liabilities 7,342 8,136
------------- -------------
Stockholders' equity:
Common stock, at par value 68 57
Additional paid-in capital 251,166 241,024
Accumulated deficit (231,423) (220,756)
------------- -------------
Total stockholders' equity 19,811 20,325
------------- -------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 27,153 $ 28,461
============= =============
(1) Derived from the January 3, 2016 audited balance sheet included in the
2015 Annual Report on Form 10-K of QuickLogic Corporation.
QUICKLOGIC CORPORATION
SUPPLEMENTAL RECONCILIATIONS OF GAAP AND NON-GAAP FINANCIAL MEASURES
(In thousands, except per share amounts and percentages)
(Unaudited)
Three Months Ended Six Months Ended
----------------------------- -------------------
July 3, June 28, April 3, July 3, June 28,
2016 2015 2016 2016 2015
-------- --------- -------- -------- ---------
GAAP loss from
operations $ (5,498) $ (4,209) $ (4,984) $(10,482) $ (7,767)
Adjustment for stock-
based compensation
within:
Cost of revenue 47 27 38 85 66
Research and
development 175 212 291 466 403
Selling, general and
administrative 217 252 233 450 519
Adjustment for the
write-off of
equipment within:
Research and
development 312 -- -- 312 --
Adjustment for
restructuring costs -- 169 -- -- 169
-------- --------- -------- -------- ---------
Non-GAAP loss from
operations $ (4,747) $ (3,549) $ (4,422) $ (9,169) $ (6,610)
======== ========= ======== ======== =========
GAAP net loss $ (5,574) $ (4,278) $ (5,093) $(10,667) $ (7,916)
Adjustment for stock-
based compensation
within:
Cost of revenue 47 27 38 85 66
Research and
development 175 212 291 466 403
Selling, general and
administrative 217 252 233 450 519
Adjustment for the
write-off of
equipment within:
Research and
development 312 -- -- 312 --
Adjustment for
restructuring costs -- 169 -- -- 169
-------- --------- -------- -------- ---------
Non-GAAP net loss $ (4,823) $ (3,618) $ (4,531) $ (9,354) $ (6,759)
======== ========= ======== ======== =========
GAAP net loss per share $ (0.08) $ (0.08) $ (0.09) $ (0.17) $ (0.14)
Adjustment for stock-
based compensation 0.01 0.01 0.01 0.02 0.02
Adjustment for the
write-off of
equipment * -- -- * --
Adjustment for
restructuring costs -- 0.01 -- -- *
-------- --------- -------- -------- ---------
Non-GAAP net loss per
share $ (0.07) $ (0.06) $ (0.08) $ (0.15) $ (0.12)
======== ========= ======== ======== =========
GAAP gross margin
percentage 28.6% 43.1% 39.2% 34.1% 45.1%
Adjustment for stock-
based compensation 1.7% 0.5% 1.3% 1.5% 0.6%
Adjustment for the
write-off equipment * --% --% * --%
Adjustment for
restructuring costs --% * --% --% *
======== ========= ======== ======== =========
Non-GAAP gross margin
percentage 30.3% 43.6% 40.5% 35.6% 45.7%
======== ========= ======== ======== =========
* Figures were not considered for reconciliation due to the insignificant
amount.
QUICKLOGIC CORPORATION
SUPPLEMENTAL DATA
(Unaudited)
Percentage of Revenue Change in Revenue
---------------------------- -----------------------
Q2 2015 to Q1 2016 to
Q2 2016 Q2 2015 Q1 2016 Q2 2016 Q2 2016
-------- -------- -------- ---------- ----------
COMPOSITION OF
REVENUE
Revenue by product:
(1)
New products 44% 59% 51% (59)% (20)%
Mature products 56% 41% 49% (25)% 4%
Revenue by
geography:
Asia Pacific 65% 70% 58% (49)% 3%
North America 24% 22% 28% (41)% (22)%
Europe 11% 8% 14% (26)% (26)%
(1) New products include all products manufactured on 180 nanometer or
smaller semiconductor processes. Mature products include all products
produced on semiconductor processes larger than 180 nanometers.
Contacts: Sue Cheung Principal Accounting Officer and Corporate Controller (408) 990-4076 Email Contact Andrea Vedanayagam (408) 656-4494 Email Contact