UNITED STATES
SECURITIES AND EXCHANGE
COMMISSION
Washington, D.C.
20549
___________________
FORM
8-K
___________________
CURRENT
REPORT
Pursuant to Section 13 or
15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of
earliest event reported): May 6, 2015
___________________
Quantum
Corporation
(Exact name of registrant
as specified in its charter)
___________________
Delaware
(State or other
jurisdiction of incorporation)
1-13449 |
94-2665054 |
(Commission File No.) |
(IRS Employer Identification
No.) |
224 Airport
Parkway, San Jose, CA 95110
(Address of principal
executive offices and zip code)
Registrants telephone
number, including area code: (408) 944-4000
___________________
Check the appropriate box
below if the Form 8-K filing is intended to simultaneously satisfy the filing
obligation of the registrant under any of the following provisions (see General
Instruction A.2. below):
☐ |
|
Written communications pursuant to
Rule 425 under the Securities Act (17 CFR 230.425) |
☐ |
|
Soliciting material pursuant to
Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
☐ |
|
Pre-commencement communications
pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b)) |
☐ |
|
Pre-commencement communications
pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c)) |
Item 2.02. Results of
Financial Operations and Financial Condition
On May 6, 2015, Quantum
Corporation issued a press release announcing earnings for its fourth quarter
and fiscal 2015, a copy of which is attached as Exhibit 99.1 hereto and
incorporated by reference.
This information shall not be
deemed filed for purposes of Section 18 of the Securities Exchange Act of
1934, as amended (the Exchange Act), or incorporated by reference in any filing
under the Securities Act of 1933, as amended, or the Exchange Act, except as
shall be expressly set forth by specific reference in such a filing.
Item 9.01. Financial
Statements and Exhibits
(d) Exhibits
99.1 |
|
Press Release, dated
May 6,
2015. |
SIGNATURE
Pursuant to the requirements
of the Securities Exchange Act of 1934, the registrant has duly caused this
report to be signed on its behalf by the undersigned hereunto duly
authorized.
|
QUANTUM CORPORATION |
|
|
|
|
|
/s/ SHAWN D. HALL |
|
Shawn D. Hall |
|
Senior Vice President, General Counsel and |
|
Secretary |
Dated: May 6, 2015
EXHIBIT INDEX
Exhibit |
|
Description |
99.1 |
|
Press Release, dated May 6, 2015. |
Exhibit 99.1
|
News
Release |
Contact: |
For
Release: |
Brad
Cohen |
May 6, 2015 |
Public Relations |
1:05 p.m. PDT |
Quantum Corp. |
|
(408) 944-4044 |
|
brad.cohen@quantum.com |
|
|
Brinlea Johnson or Allise Furlani |
|
Investor Relations |
|
The
Blueshirt Group |
|
(212) 331-8424 or (212) 331-8433 |
|
ir@quantum.com |
|
Quantum Corporation Reports Fiscal Fourth Quarter and
Full Year 2015
Results
Fiscal 2015 Year-Over-Year
Highlights:
● |
Total revenue of $553.1 million, with branded
revenue up 7% to $448.0 million after growing 20% in fourth
quarter |
● |
Scale-out storage revenue up 74% to record $102.4
million, with 116% growth in fourth quarter |
● |
DXi deduplication revenue up 10% to $88.2 million,
with 30% growth in fourth quarter |
● |
GAAP and non-GAAP net income of $16.8 million and
$38.1 million, up $38.2 million and $24.4 million,
respectively |
SAN JOSE, Calif., May 6, 2015 Quantum Corp. (NYSE:QTM)
today reported results for the fiscal fourth quarter and full year 2015 ended
March 31, 2015.
Fiscal Fourth Quarter 2015 Results
(All comparisons are relative to the fiscal fourth quarter of
2014.)
● |
Revenue was $147.8 million, up 15 percent,
primarily driven by strong sales of scale-out storage and DXi®
deduplication solutions. |
● |
Total branded revenue grew to $122.1 million, a
20 percent increase. |
● |
Scale-out storage and related service revenue
increased 116 percent, to a record $31.7
million. |
● |
DXi deduplication appliance and
related service revenue was $25.2 million, an increase of 30
percent. |
-more-
● |
GAAP operating income was $2.5 million, up from
an operating loss of $12.5 million. |
● |
GAAP net income was $12.9 million, or $0.04 per
diluted share. This included $13.6 million from the gain on sale of
Quantums investment in a privately held company. In the fiscal fourth
quarter 2014, the company had a net loss of $14.4 million, or $0.06 per
diluted share. |
● |
Non-GAAP operating income was $6.3 million, up
from an operating loss of $159,000. |
● |
Non-GAAP net income was $18.0 million, or $0.06
per diluted share, again including $13.6 million from the gain on sale of
Quantums investment in a privately held company. In the fiscal fourth
quarter 2014, Quantum had a net loss of $2.1 million, or $0.01 per diluted
share. |
Fiscal 2015 Results
(All comparisons are relative to fiscal 2014, which included a one-time
$15 million royalty payment to Quantum.)
● |
Revenue was $553.1 million, compared to $553.2
million, as Quantums $29.8 million in branded revenue growth offset the
combination of a $14.0 million decline in OEM revenue and a $15.8 million
reduction in royalty revenue. |
● |
Total branded revenue grew to $448.0 million, a
7 percent increase. |
● |
Scale-out storage revenue reached a record
level of $102.4 million, growing 74 percent. |
● |
DXi revenue was $88.2 million, a 10 percent
increase. |
● |
GAAP operating income was $14.4 million, up
from an operating loss of $11.8 million. |
● |
GAAP net income was $16.8 million, or $0.06 per
diluted share, compared to a net loss of $21.5 million, or $0.09 per
diluted share. |
● |
Non-GAAP operating income was $34.4 million, up
from $23.3 million. |
● |
Non-GAAP net income was $38.1 million, or $0.14
per diluted share, up from $13.7 million, or $0.05 per diluted
share. |
● |
Quantum ended the fiscal year with $70.6
million in total cash and cash equivalents, which reflected the early
repurchase of $50 million of convertible notes due November 2015 in an all
cash-transaction completed during the fourth
quarter. |
Our fourth quarter capped off a year that was a key turning point for
Quantum as we generated strong revenue and profit results that reflect the
strategic actions weve taken over the last several years to improve our
financial and operational performance, deliver even greater value to customers
and position the company for the future, said Linda Breard, CFO. Branded revenue grew
year-over-year in all four quarters, driven by growth rates in scale-out storage
increasing each quarter ultimately to 116 percent in Q4. We also returned to
generating annual growth in DXi revenue, and our full year GAAP net income was
the highest its been in more than five years.
-more-
We are well-positioned to build on this momentum and drive increased
growth and profit in fiscal 2016, said Jon Gacek, president and CEO. Our
scale-out storage solutions offer a unique combination of industry-leading
performance and low-cost retention through multi-tier storage across sites and
the cloud all managed by our StorNext® platform. This makes them ideal for
addressing increased demands for re-monetizing and analyzing digital content. As
a result, we plan to expand our leadership in media and entertainment and also
extend our expertise to other markets such as video surveillance, corporate
video and high performance computing applications.
At the same time, we will leverage our long-standing leadership in data
protection technology, recently expanded archive offerings and incorporation of
Dot Hill disk arrays into our product line to provide our large install base of
users and future customers with an even broader range of data center
solutions.
Finally, we will continue to invest in delivering further differentiated
solutions, capitalizing on new opportunities through sales and marketing initiatives and driving long-term growth.
Fiscal 2016
Outlook
For the fiscal first quarter,
Quantum expects:
● |
Revenue of approximately $125 million to $130
million, reflecting typical seasonality and the strength of the
prior quarter, including the large number of significant deals that closed toward the end
of the quarter. |
● |
Scale-out storage revenue growth of 50 percent
over the fiscal first quarter of 2015. |
● |
GAAP and non-GAAP gross margin of approximately
45-46 percent. |
● |
GAAP and non-GAAP operating expenses of
approximately $57 million and $54 million, respectively. |
● |
GAAP operating loss of $100,000 to
operating income of $1.9 million and non-GAAP operating income of $3
million to $5 million. |
● |
Interest expense of $1.9 million and taxes of
$400,000. |
-more-
● |
GAAP net loss of $2.1 million to $100,000,
or a loss of $0.01 to $0.00 per diluted share, and non-GAAP net income of
$1 million to $3 million, or $0.00 to $0.01 per diluted
share. |
For the full fiscal 2016 year,
Quantum is targeting year-over-year growth of:
● |
4-5 percent in total revenue. |
● |
50 percent in scale-out storage
revenue. |
● |
8-10 percent in non-GAAP operating
income. |
Changes in Board of Directors
In a separate news release issued today, Quantum announced the
resignation of Jeffrey Smith from its board of directors and appointment of
Robert Andersen (see news release at www.quantum.com/BODchanges).
Fiscal Fourth Quarter 2015 Business Highlights
● |
Quantum announced three new solutions that
integrate the cloud into multi-tier, hybrid storage architectures for
demanding data workloads. Q-Cloud Archive and Q-Cloud Vault incorporate
the power of the public cloud as an off-site tier within a Quantum
StorNext 5 workflow environment, while Q-Cloud Protect for AWS enables
customers using Quantums DXi deduplication appliances to replicate data
to the Amazon Web Services (AWS) cloud. With all three offerings,
customers can realize the full benefits of the cloud without having to
make changes to existing applications or processes. |
● |
The company introduced StorNext QXS-5600, a
high-capacity, high-density disk array that provides extremely
cost-effective storage for customers managing an increasing number of
large files containing high-resolution video, images or other rich
content. The new offering, which has been extremely well-received by
customers, provides ideal work-in-process storage for a wide variety of
applications, including 4K and 8K video production and postproduction,
geospatial imaging, seismic research and analysis, and video
surveillance. |
● |
Further reflecting its expansion into video
surveillance, Quantum announced the certification of StorNext with
XProtect® VMS from Milestone Systems, the worlds leading provider of open
platform IP video management software (VMS). The combined solution stores
large amounts of video files while optimizing the performance of the
system. |
-more-
● |
Fujitsu America and Quantum began offering North American
customers a joint solution for large enterprise and mainframe backup and
archive storage that encompasses best-in-class disk and tape technologies
from Fujitsu and Quantum, respectively. |
● |
The company announced the Quantum Advantage Program, a platform
for partners to test and qualify their technology with its
offerings, ensuring tightly integrated solutions
for the most demanding customer environments. |
● |
Quantum continued to garner awards and honors.
StorNext Pro™ Solutions received a Visionary Product Award for Enabling
Collaborative Storage Technology at the 14th annual Storage Visions
Conference. In addition, Storage magazine named DXi6900 and StorNext 5 as
finalists in two categories of its 2014 Product of the Year Awards, with
DXi6900 later receiving a Silver Award. StorNext 5 was also named a
finalist in the Storage Product of the Year category of the UKs Network
Computing Awards 2015 and the Postproduction category of the StudioDaily
Prime Awards. |
Conference Call and Audio Webcast Notification
Quantum will issue a news release on its fourth quarter and full year
2015 financial results on Wednesday, May 6, 2015, after the close of the market.
The company will also hold a conference call and live audio webcast to discuss
these results that same day at 2:00 p.m. PDT. Press and industry analysts are
invited to attend in listen-only mode.
Dial-in number: 719-457-2645 (U.S. and International); Access Code 6066999
Replay number: 719-457-0820 (U.S. and International); Access Code 6066999
Replay expiration: Monday, May 11, 2015, at 5:00 p.m. PDT
Webcast site: www.quantum.com/investors
About Quantum
Quantum is a leading expert in scale-out storage, archive and data
protection, providing solutions for capturing, sharing and
preserving digital assets over the entire data lifecycle. From small businesses
to major enterprises, more than 100,000 customers have trusted Quantum to
address their most demanding data workflow challenges. With Quantum, customers
can Be Certain they have the end-to-end storage foundation to maximize the
value of their data by making it accessible whenever and wherever needed,
retaining it indefinitely and reducing total cost and complexity. See how at
www.quantum.com/customerstories.
-more-
###
Quantum, the Quantum logo, Be
Certain, DXi, StorNext, StorNext Pro, Q-Cloud and Quantum Advantage Program are either registered
trademarks or trademarks of Quantum Corporation and its affiliates in the United
States and/or other countries. All other trademarks are the property of their
respective owners.
Safe Harbor Statement under
the U.S. Private Securities Litigation Reform Act of 1995: This press release
contains forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995. Specifically, without limitation, our statements that we are well-positioned to build on our momentum and drive increased growth and profit in fiscal 2016, that we plan to expand our leadership in media and entertainment and also extend our expertise to other markets such as video surveillance, corporate video and high performance computing applications, that we will leverage our long-standing leadership in data protection technology, that we will continue to invest in delivering further differentiated solutions, capitalizing on new opportunities through sales and marketing initiatives and driving long-term growth and all of our statements under the section titled “Fiscal 2016 Outlook” are forward-looking statements within the meaning of the Safe Harbor. All forward-looking statements in this press release are based on information available to Quantum on the date hereof. These statements involve known and unknown risks, uncertainties and other factors that may cause Quantum’s actual results to differ materially from those implied by the forward-looking statement. More detailed information about these risk factors, and additional risk factors are set forth in Quantum’s periodic filings with the Securities and Exchange Commission, including, but not limited to, those risks and uncertainties listed in the section entitled “Risk Factors” in Quantum’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on June 6, 2014 and in Quantum’s Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on February 6, 2015. Quantum expressly disclaims any obligation to update or alter its forward-looking statements, whether as a result of new information, future events or otherwise.
Use of Non-GAAP Financial
Measures
Quantum believes that the
non-GAAP financial measures disclosed above provide useful and supplemental
information to investors regarding its quarterly financial performance. Quantum
management uses these non-GAAP financial measures internally to understand,
manage and evaluate the companys business results and make operating decisions.
For instance, Quantum management often makes decisions regarding staffing,
future management priorities and how the company will direct future operating
expenses on the basis of non-GAAP financial measures. In addition, compensation
of our employees is based in part on the performance of our business based on
non-GAAP operating income.
The non-GAAP financial
measures used in this press release exclude the impact of the items below for
the following reasons:
Amortization of Intangible
Assets
This includes acquired intangibles such as
purchased technology and customer relationships in connection with prior
acquisitions. These expenses are not factored into managements evaluation of
potential acquisitions or Quantums performance after completion of the
acquisitions because they are not related to Quantums core operating
performance. In addition, the frequency and amount of such charges can vary
significantly based on the size and timing of acquisitions and the maturities of
the businesses being acquired. Excluding acquisition-related charges from
non-GAAP measures provides investors with a basis to compare Quantum against the
performance of other companies without the variability caused by purchase
accounting.
Share-Based Compensation
Expense
Share-based compensation expense relates primarily
to equity awards such as stock options and restricted stock units. Share-based
compensation is a non-cash expense that varies in amount from period to period
and is dependent on market forces that are often beyond Quantums control. As a
result, management excludes this item from Quantums internal operating
forecasts and models. Management believes that non-GAAP measures adjusted for
share-based compensation provide investors with a basis to measure Quantums
core performance against the performance of other companies without the
variability created by share-based compensation as a result of the variety of
equity awards used by other companies and the varying valuation methodologies
and assumptions used.
Restructuring
Charges
Restructuring charges primarily relate to expenses
associated with changes to Quantums operating structure. Restructuring charges
are excluded from non-GAAP financial measures because they are not considered
core operating activities. Although Quantum has engaged in various restructuring
activities in the past, each has been a discrete event based on a unique set of
business objectives. Management believes that it is appropriate to exclude
restructuring charges from Quantums non-GAAP financial measures, as it enhances
the ability of investors to compare Quantums period-over-period operating
results from continuing operations.
Outsourcing Transition
Costs
Outsourcing transition costs are expenses
attributable to transitioning our manufacturing to an outsourced model. These
costs are excluded from non-GAAP financial measures because they are not
considered core operating activities and management believes that it is
appropriate to exclude these costs in order to provide investors the ability to
compare Quantums period-over-period operating results from continuing
operations.
Proxy Contest and Related
Costs
Proxy contest and related costs are expenses
incurred to respond to activities and inquiries of Starboard Value LP, including
their proxy solicitation. The Company has not incurred significant expenses in
connection with such matters in historical periods and these costs are not
considered core operating activities. Management believes that it is appropriate
to exclude these costs in order to provide investors the ability to compare
Quantums period-over-period operating results from continuing operations.
Crossroads Patent
Litigation Costs
Crossroads patent litigation costs are expenses
incurred to defend ourselves and perform other activities related to a patent
infringement lawsuit filed by Crossroads Systems, Inc. These costs are excluded
from non-GAAP financial measures because they are not considered core operating
activities, and management believes that it is appropriate to exclude these
costs in order to provide investors the ability to compare Quantums
period-over-period operating results from continuing operations.
-more-
Acquisition
Expenses
The acquisition expenses were those expenses
incurred to acquire Symform, Inc. (Symform) and are not part of Quantums
future core operations.
Symform Expenses,
Net
Quantum acquired a cloud storage services platform
from Symform in July 2014. Symform revenue comprises revenue generated from the
Symform cloud storage services platform. Symform expenses consist of costs
related to running, maintaining and further developing the Symform cloud storage
services platform as well as the costs of integrating Symform into Quantums
business. Net Symform expenses represent Symform expenses less Symform revenue,
and non-GAAP gross margin excludes both Symform revenue and cost of revenue.
Management believes that it is appropriate to exclude these amounts in order to
provide investors with a view of Quantums results consistent with how
management views and is running the business.
Loss on Debt
Extinguishment
The loss on debt extinguishment relates to a
specific debt repurchase action undertaken in January 2015. The loss is excluded
from non-GAAP financial measures because it is not considered a core operating
activity and management believes that it is appropriate to exclude the loss in
order to provide investors the ability to compare Quantums period-over-period
results from continuing operations.
Non-GAAP financial measures
should not be considered as a substitute for, or superior to, measures of
financial performance prepared in accordance with GAAP. They are limited in
value because they exclude charges that have a material impact on the companys
reported financial results and, therefore, should not be relied upon as the sole
financial measures to evaluate the company. The non-GAAP financial measures are
meant to supplement, and be viewed in conjunction with, GAAP financial measures.
Investors are encouraged to review the reconciliation of the non-GAAP financial
measures to their most directly comparable GAAP financial measures as provided
in the tables accompanying this press release.
-more-
QUANTUM CORPORATION
CONDENSED CONSOLIDATED
BALANCE SHEETS
(In thousands)
(Unaudited)
|
|
March 31, 2015 |
|
March 31, 2014* |
Assets |
|
|
|
|
|
|
|
|
Current assets: |
|
|
|
|
|
|
|
|
Cash
and cash equivalents |
|
$ |
67,948 |
|
|
$ |
99,125 |
|
Restricted
cash |
|
|
2,621 |
|
|
|
2,760 |
|
Accounts
receivable |
|
|
124,159 |
|
|
|
101,605 |
|
Manufacturing
inventories |
|
|
50,274 |
|
|
|
34,815 |
|
Service
parts inventories |
|
|
24,640 |
|
|
|
25,629 |
|
Other
current assets |
|
|
12,332 |
|
|
|
10,161 |
|
Total
current assets |
|
|
281,974 |
|
|
|
274,095 |
|
|
Long-term assets: |
|
|
|
|
|
|
|
|
Property
and equipment |
|
|
14,653 |
|
|
|
17,574 |
|
Intangible
assets |
|
|
731 |
|
|
|
3,911 |
|
Goodwill |
|
|
55,613 |
|
|
|
55,613 |
|
Other
long-term assets |
|
|
5,784 |
|
|
|
10,605 |
|
Total
long-term assets |
|
|
76,781 |
|
|
|
87,703 |
|
|
|
|
|
|
|
|
|
|
|
|
$ |
358,755 |
|
|
$ |
361,798 |
|
|
Liabilities and Stockholders' Deficit |
|
|
|
|
|
|
|
|
Current liabilities: |
|
|
|
|
|
|
|
|
Accounts
payable |
|
$ |
54,367 |
|
|
$ |
41,792 |
|
Accrued
warranty |
|
|
4,219 |
|
|
|
6,116 |
|
Deferred
revenue, current |
|
|
95,899 |
|
|
|
98,098 |
|
Accrued
restructuring charges, current |
|
|
3,855 |
|
|
|
4,345 |
|
Convertible
subordinated debt, current |
|
|
83,735 |
|
|
|
- |
|
Accrued
compensation |
|
|
35,414 |
|
|
|
25,036 |
|
Other
accrued liabilities |
|
|
20,740 |
|
|
|
15,168 |
|
Total
current liabilities |
|
|
298,229 |
|
|
|
190,555 |
|
|
Long-term liabilities: |
|
|
|
|
|
|
|
|
Deferred
revenue, long-term |
|
|
39,532 |
|
|
|
40,054 |
|
Accrued
restructuring charges, long-term |
|
|
991 |
|
|
|
4,023 |
|
Convertible
subordinated debt, long-term |
|
|
70,000 |
|
|
|
203,735 |
|
Other
long-term liabilities |
|
|
10,441 |
|
|
|
10,831 |
|
Total
long-term liabilities |
|
|
120,964 |
|
|
|
258,643 |
|
|
Stockholders'
deficit |
|
|
(60,438 |
) |
|
|
(87,400 |
) |
|
|
|
|
|
|
|
|
|
|
|
$ |
358,755 |
|
|
$ |
361,798 |
|
* Derived from the March 31,
2014 audited Consolidated Financial Statements.
-more-
QUANTUM CORPORATION
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS
(In thousands, except per share
amounts)
(Unaudited)
|
|
Three Months Ended |
|
Twelve Months Ended |
|
|
March 31, 2015 |
|
March 31, 2014 |
|
March 31, 2015 |
|
March 31, 2014 |
Revenue: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Product |
|
$ |
98,003 |
|
|
$ |
79,426 |
|
|
$ |
355,579 |
|
|
$ |
348,318 |
|
Service |
|
|
38,826 |
|
|
|
37,587 |
|
|
|
155,674 |
|
|
|
147,199 |
|
Royalty |
|
|
10,969 |
|
|
|
10,955 |
|
|
|
41,842 |
|
|
|
57,648 |
|
Total
revenue |
|
|
147,798 |
|
|
|
127,968 |
|
|
|
553,095 |
|
|
|
553,165 |
|
Cost
of revenue: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Product |
|
|
67,406 |
|
|
|
55,909 |
|
|
|
237,679 |
|
|
|
237,076 |
|
Service |
|
|
18,228 |
|
|
|
19,877 |
|
|
|
70,730 |
|
|
|
75,930 |
|
Restructuring
charges related to cost of revenue |
|
|
- |
|
|
|
162 |
|
|
|
- |
|
|
|
539 |
|
Total
cost of revenue |
|
|
85,634 |
|
|
|
75,948 |
|
|
|
308,409 |
|
|
|
313,545 |
|
Gross
margin |
|
|
62,164 |
|
|
|
52,020 |
|
|
|
244,686 |
|
|
|
239,620 |
|
|
Operating
expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research
and development |
|
|
14,938 |
|
|
|
15,312 |
|
|
|
58,618 |
|
|
|
64,375 |
|
Sales
and marketing |
|
|
30,537 |
|
|
|
29,194 |
|
|
|
113,954 |
|
|
|
118,771 |
|
General
and administrative |
|
|
14,242 |
|
|
|
14,120 |
|
|
|
56,513 |
|
|
|
57,865 |
|
Restructuring
charges (benefits) |
|
|
(10 |
) |
|
|
6,150 |
|
|
|
1,666 |
|
|
|
10,675 |
|
Total
operating expenses |
|
|
59,707 |
|
|
|
64,776 |
|
|
|
230,751 |
|
|
|
251,686 |
|
Gain
on sale of assets |
|
|
- |
|
|
|
267 |
|
|
|
462 |
|
|
|
267 |
|
Income
(loss) from operations |
|
|
2,457 |
|
|
|
(12,489 |
) |
|
|
14,397 |
|
|
|
(11,799 |
) |
|
Other
income and expense |
|
|
13,621 |
|
|
|
505 |
|
|
|
13,836 |
|
|
|
1,296 |
|
Interest
expense |
|
|
(2,100 |
) |
|
|
(2,435 |
) |
|
|
(9,460 |
) |
|
|
(9,754 |
) |
Loss
on debt extinguishment |
|
|
(1,295 |
) |
|
|
- |
|
|
|
(1,295 |
) |
|
|
- |
|
Income
(loss) before income taxes |
|
|
12,683 |
|
|
|
(14,419 |
) |
|
|
17,478 |
|
|
|
(20,257 |
) |
Income
tax provision |
|
|
(222 |
) |
|
|
(15 |
) |
|
|
718 |
|
|
|
1,217 |
|
Net
income (loss) |
|
$ |
12,905 |
|
|
$ |
(14,404 |
) |
|
$ |
16,760 |
|
|
$ |
(21,474 |
) |
|
Income
(loss) per share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
$ |
0.05 |
|
|
$ |
(0.06 |
) |
|
$ |
0.07 |
|
|
$ |
(0.09 |
) |
Diluted |
|
$ |
0.04 |
|
|
$ |
(0.06 |
) |
|
$ |
0.06 |
|
|
$ |
(0.09 |
) |
|
Weighted
average shares: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
257,391 |
|
|
|
249,593 |
|
|
|
254,665 |
|
|
|
247,024 |
|
Diluted |
|
|
307,076 |
|
|
|
249,593 |
|
|
|
260,027 |
|
|
|
247,024 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Included in the above Statements
of Operations: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amortization of intangibles: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost
of revenue |
|
$ |
160 |
|
|
$ |
372 |
|
|
$ |
913 |
|
|
$ |
1,476 |
|
Sales
and marketing |
|
|
- |
|
|
|
1,857 |
|
|
|
2,784 |
|
|
|
7,426 |
|
|
|
|
160 |
|
|
|
2,229 |
|
|
|
3,697 |
|
|
|
8,902 |
|
Share-based compensation: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost
of revenue |
|
|
380 |
|
|
|
403 |
|
|
|
1,489 |
|
|
|
1,963 |
|
Research
and development |
|
|
576 |
|
|
|
792 |
|
|
|
2,559 |
|
|
|
3,430 |
|
Sales
and marketing |
|
|
879 |
|
|
|
949 |
|
|
|
3,506 |
|
|
|
4,097 |
|
General
and administrative |
|
|
1,093 |
|
|
|
1,047 |
|
|
|
4,029 |
|
|
|
3,969 |
|
|
|
|
2,928 |
|
|
|
3,191 |
|
|
|
11,583 |
|
|
|
13,459 |
|
Outsourcing transition costs: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost
of revenue |
|
|
- |
|
|
|
598 |
|
|
|
126 |
|
|
|
1,550 |
|
|
|
|
- |
|
|
|
598 |
|
|
|
126 |
|
|
|
1,550 |
|
Proxy contest and related
costs: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
General
and administrative |
|
|
- |
|
|
|
- |
|
|
|
972 |
|
|
|
- |
|
|
|
|
- |
|
|
|
- |
|
|
|
972 |
|
|
|
- |
|
Crossroads patent litigation costs: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
General
and administrative |
|
|
416 |
|
|
|
- |
|
|
|
1,160 |
|
|
|
- |
|
|
|
|
416 |
|
|
|
- |
|
|
|
1,160 |
|
|
|
- |
|
Acquisition expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
General
and administrative |
|
|
- |
|
|
|
- |
|
|
|
4 |
|
|
|
- |
|
|
|
|
- |
|
|
|
- |
|
|
|
4 |
|
|
|
- |
|
Symform expenses, net: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross
margin |
|
|
28 |
|
|
|
- |
|
|
|
78 |
|
|
|
- |
|
Research
and development |
|
|
136 |
|
|
|
- |
|
|
|
377 |
|
|
|
- |
|
Sales
and marketing |
|
|
143 |
|
|
|
- |
|
|
|
338 |
|
|
|
- |
|
General
and administrative |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
307 |
|
|
|
- |
|
|
|
793 |
|
|
|
- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
-more-
QUANTUM CORPORATION
CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
|
|
Twelve Months Ended |
|
|
March 31, 2015 |
|
March 31, 2014 |
Cash
flows from operating activities: |
|
|
|
|
|
|
|
|
Net
income (loss) |
|
$ |
16,760 |
|
|
$ |
(21,474 |
) |
Adjustments
to reconcile net income (loss) to net cash provided by operating
activities: |
|
|
|
|
|
|
|
|
Depreciation |
|
|
8,281 |
|
|
|
10,713 |
|
Amortization
of intangible assets |
|
|
3,697 |
|
|
|
8,902 |
|
Amortization
and write off of debt issuance costs |
|
|
1,896 |
|
|
|
1,634 |
|
Service
parts lower of cost or market adjustment |
|
|
3,698 |
|
|
|
11,307 |
|
Deferred
income taxes |
|
|
(160 |
) |
|
|
36 |
|
Share-based
compensation |
|
|
11,583 |
|
|
|
13,459 |
|
Gain
on sale of assets |
|
|
(462 |
) |
|
|
- |
|
Gain
on sale of other investments |
|
|
(13,574 |
) |
|
|
- |
|
Changes
in assets and liabilities, net of effect of acquisition: |
|
|
|
|
|
|
|
|
Accounts
receivable |
|
|
(22,554 |
) |
|
|
(4,770 |
) |
Manufacturing
inventories |
|
|
(19,688 |
) |
|
|
13,352 |
|
Service
parts inventories |
|
|
(1,010 |
) |
|
|
2,675 |
|
Accounts
payable |
|
|
12,849 |
|
|
|
(5,881 |
) |
Accrued
warranty |
|
|
(1,897 |
) |
|
|
(1,404 |
) |
Deferred
revenue |
|
|
(2,721 |
) |
|
|
8,651 |
|
Accrued
restructuring charges |
|
|
(3,548 |
) |
|
|
3,619 |
|
Accrued
compensation |
|
|
11,318 |
|
|
|
(6,140 |
) |
Other
assets and liabilities |
|
|
1,566 |
|
|
|
795 |
|
Net
cash provided by operating activities |
|
|
6,034 |
|
|
|
35,474 |
|
|
Cash
flows from investing activities: |
|
|
|
|
|
|
|
|
Purchases
of property and equipment |
|
|
(3,241 |
) |
|
|
(5,957 |
) |
Proceeds
from sale of assets |
|
|
462 |
|
|
|
- |
|
Change
in restricted cash |
|
|
(250 |
) |
|
|
426 |
|
Purchases
of other investments |
|
|
(22 |
) |
|
|
(1,118 |
) |
Return
of principal from other investments |
|
|
112 |
|
|
|
- |
|
Proceeds
from sale of other investments |
|
|
15,097 |
|
|
|
- |
|
Payment
for business acquisition, net of cash acquired |
|
|
(517 |
) |
|
|
- |
|
Net
cash provided by (used in) investing activities |
|
|
11,641 |
|
|
|
(6,649 |
) |
|
Cash
flows from financing activities: |
|
|
|
|
|
|
|
|
Repayments
of convertible subordinated debt |
|
|
(50,000 |
) |
|
|
(1,265 |
) |
Payment
of taxes due upon vesting of restricted stock |
|
|
(2,378 |
) |
|
|
(1,880 |
) |
Proceeds
from issuance of common stock |
|
|
3,737 |
|
|
|
4,430 |
|
Net
cash provided by (used in) financing activities |
|
|
(48,641 |
) |
|
|
1,285 |
|
|
Effect of exchange rate changes on cash and
cash equivalents |
|
|
(211 |
) |
|
|
39 |
|
|
Net
increase (decrease) in cash and cash equivalents |
|
|
(31,177 |
) |
|
|
30,149 |
|
Cash
and cash equivalents at beginning of period |
|
|
99,125 |
|
|
|
68,976 |
|
Cash
and cash equivalents at end of period |
|
$ |
67,948 |
|
|
$ |
99,125 |
|
-more-
QUANTUM
CORPORATION
GAAP TO NON-GAAP RECONCILIATION
(In thousands, except per share
amounts)
(Unaudited)
|
|
Three Months Ended
March 31, 2015 |
|
|
Gross
Margin |
|
Gross
Margin Rate |
|
Income
From Operations |
|
Operating Margin |
|
Net
Income |
|
Per Share
Net Income, Basic |
|
Per Share
Net Income, Diluted |
GAAP |
|
$ |
62,164 |
|
42.1 |
% |
|
$ |
2,457 |
|
|
1.7 |
% |
|
$ |
12,905 |
|
|
$ |
0.05 |
|
$ |
0.04 |
Non-GAAP Reconciling Items: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amortization of
intangibles |
|
|
160 |
|
|
|
|
|
160 |
|
|
|
|
|
|
160 |
|
|
|
|
|
|
|
Share-based
compensation |
|
|
380 |
|
|
|
|
|
2,928 |
|
|
|
|
|
|
2,928 |
|
|
|
|
|
|
|
Restructuring
benefits |
|
|
- |
|
|
|
|
|
(10 |
) |
|
|
|
|
|
(10 |
) |
|
|
|
|
|
|
Crossroads patent
litigation costs |
|
|
- |
|
|
|
|
|
416 |
|
|
|
|
|
|
416 |
|
|
|
|
|
|
|
Symform expenses,
net |
|
|
28 |
|
|
|
|
|
307 |
|
|
|
|
|
|
307 |
|
|
|
|
|
|
|
Loss on debt
extinguishment |
|
|
- |
|
|
|
|
|
- |
|
|
|
|
|
|
1,295 |
|
|
|
|
|
|
|
Non-GAAP |
|
$ |
62,732 |
|
42.4 |
% |
|
$ |
6,258 |
|
|
4.2 |
% |
|
$ |
18,001 |
|
|
$ |
0.07 |
|
$ |
0.06 |
|
Computation of basic and diluted net income per share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP |
|
Non-GAAP |
Net income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
12,905 |
|
$ |
18,001 |
Interest on dilutive convertible notes |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
902 |
|
|
1,968 |
Income for purposes of computing income per diluted share |
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
13,807 |
|
$ |
19,969 |
|
Weighted average shares: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
257,391 |
|
|
257,391 |
Dilutive shares from stock plans |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
7,183 |
|
|
7,183 |
Dilutive shares from convertible notes |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
42,502 |
|
|
65,675 |
Diluted |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
307,076 |
|
|
330,249 |
|
|
Twelve Months Ended
March 31, 2015 |
|
|
Gross
Margin |
|
Gross
Margin Rate |
|
Income
From Operations |
|
Operating Margin |
|
Net
Income |
|
Per Share
Net Income, Basic |
|
Per Share
Net Income, Diluted |
GAAP |
|
$ |
244,686 |
|
44.2 |
% |
|
$ |
14,397 |
|
2.6 |
% |
|
$ |
16,760 |
|
|
$ |
0.07 |
|
$ |
0.06 |
Non-GAAP Reconciling
Items: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amortization of
intangibles |
|
|
913 |
|
|
|
|
|
3,697 |
|
|
|
|
|
3,697 |
|
|
|
|
|
|
|
Share-based
compensation |
|
|
1,489 |
|
|
|
|
|
11,583 |
|
|
|
|
|
11,583 |
|
|
|
|
|
|
|
Restructuring
charges |
|
|
- |
|
|
|
|
|
1,666 |
|
|
|
|
|
1,666 |
|
|
|
|
|
|
|
Outsourcing transition
costs |
|
|
126 |
|
|
|
|
|
126 |
|
|
|
|
|
126 |
|
|
|
|
|
|
|
Proxy contest and
related costs |
|
|
- |
|
|
|
|
|
972 |
|
|
|
|
|
972 |
|
|
|
|
|
|
|
Crossroads patent
litigation costs |
|
|
- |
|
|
|
|
|
1,160 |
|
|
|
|
|
1,160 |
|
|
|
|
|
|
|
Acquisition
expenses |
|
|
- |
|
|
|
|
|
4 |
|
|
|
|
|
4 |
|
|
|
|
|
|
|
Symform expenses,
net |
|
|
78 |
|
|
|
|
|
793 |
|
|
|
|
|
793 |
|
|
|
|
|
|
|
Loss on debt
extinguishment |
|
|
- |
|
|
|
|
|
- |
|
|
|
|
|
1,295 |
|
|
|
|
|
|
|
Non-GAAP |
|
$ |
247,292 |
|
44.7 |
% |
|
$ |
34,398 |
|
6.2 |
% |
|
$ |
38,056 |
|
|
$ |
0.15 |
|
$ |
0.14 |
|
Computation of basic and diluted net income per share: |
|
|
|
|
|
|
|
|
|
|
|
|
GAAP |
|
Non-GAAP |
Net income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
16,760 |
|
$ |
38,056 |
Interest on dilutive convertible notes |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
- |
|
|
3,610 |
Income for purposes of computing income per diluted share |
|
|
|
|
|
|
|
|
|
|
|
|
$ |
16,760 |
|
$ |
41,666 |
|
Weighted average shares: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
254,665 |
|
|
254,665 |
Dilutive shares from stock plans |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
5,362 |
|
|
5,362 |
Dilutive shares from convertible notes |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
- |
|
|
42,502 |
Diluted |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
260,027 |
|
|
302,529 |
The non-GAAP financial
information set forth in this table is not prepared in accordance with generally
accepted accounting principles and may be different from non-GAAP financial
information used by other companies.
-more-
QUANTUM
CORPORATION
GAAP TO NON-GAAP RECONCILIATION
(In thousands, except per share
amounts)
(Unaudited)
|
|
Three Months Ended
March 31, 2014 |
|
|
Gross
Margin |
|
Gross
Margin Rate |
|
Loss
From Operations |
|
Operating Margin |
|
Net
Loss |
|
Per Share
Net Loss, Basic |
|
Per Share
Net Loss, Diluted |
GAAP |
|
$
|
52,020 |
|
40.7 |
% |
|
$
|
(12,489 |
) |
|
(9.8 |
)% |
|
$
|
(14,404 |
) |
|
$
|
(0.06 |
) |
|
$
|
(0.06 |
) |
Non-GAAP Reconciling Items: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amortization of intangibles |
|
|
372 |
|
|
|
|
|
2,229 |
|
|
|
|
|
|
2,229 |
|
|
|
|
|
|
|
|
|
Share-based compensation |
|
|
403 |
|
|
|
|
|
3,191 |
|
|
|
|
|
|
3,191 |
|
|
|
|
|
|
|
|
|
Restructuring charges |
|
|
162 |
|
|
|
|
|
6,312 |
|
|
|
|
|
|
6,312 |
|
|
|
|
|
|
|
|
|
Outsourcing transition costs |
|
|
598 |
|
|
|
|
|
598 |
|
|
|
|
|
|
598 |
|
|
|
|
|
|
|
|
|
Non-GAAP |
|
$ |
53,555 |
|
41.9 |
% |
|
$ |
(159 |
) |
|
(0.1 |
)% |
|
$ |
(2,074 |
) |
|
$ |
(0.01 |
) |
|
$ |
(0.01 |
) |
|
Computation of basic and diluted net loss per share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP |
|
Non-GAAP |
Net loss |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
(14,404 |
) |
|
$ |
(2,074 |
) |
|
Weighted average shares: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
249,593 |
|
|
|
249,593 |
|
|
|
Twelve Months Ended
March 31, 2014 |
|
|
Gross
Margin |
|
Gross
Margin Rate |
|
Income (Loss) From
Operations |
|
Operating Margin |
|
Net
Income (Loss) |
|
Per Share
Net Income (Loss), Basic |
|
Per Share
Net Income (Loss), Diluted |
GAAP |
|
$
|
239,620 |
|
43.3 |
% |
|
$
|
(11,799 |
) |
|
(2.1 |
)% |
|
$
|
(21,474 |
) |
|
$
|
(0.09 |
) |
|
$
|
(0.09 |
) |
Non-GAAP Reconciling Items: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amortization of intangibles |
|
|
1,476 |
|
|
|
|
|
8,902 |
|
|
|
|
|
|
8,902 |
|
|
|
|
|
|
|
|
|
Share-based compensation |
|
|
1,963 |
|
|
|
|
|
13,459 |
|
|
|
|
|
|
13,459 |
|
|
|
|
|
|
|
|
|
Restructuring charges |
|
|
539 |
|
|
|
|
|
11,214 |
|
|
|
|
|
|
11,214 |
|
|
|
|
|
|
|
|
|
Outsourcing transition costs |
|
|
1,550 |
|
|
|
|
|
1,550 |
|
|
|
|
|
|
1,550 |
|
|
|
|
|
|
|
|
|
Non-GAAP |
|
$ |
245,148 |
|
44.3 |
% |
|
$ |
23,326 |
|
|
4.2 |
% |
|
$ |
13,651 |
|
|
$ |
0.06 |
|
|
$ |
0.05 |
|
|
Computation of basic and diluted net income (loss) per share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP |
|
Non-GAAP |
Net income (loss) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
(21,474 |
) |
|
$ |
13,651 |
|
|
Weighted average shares: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
247,024 |
|
|
|
247,024 |
|
Dilutive shares from stock plans |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
- |
|
|
|
3,004 |
|
Diluted |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
247,024 |
|
|
|
250,028 |
|
The non-GAAP financial
information set forth in this table is not prepared in accordance with generally
accepted accounting principles and may be different from non-GAAP financial
information used by other companies.
-more-
QUANTUM
CORPORATION
FORECAST FIRST QUARTER FISCAL 2016
GAAP TO NON-GAAP
RECONCILIATION
(Dollars in
millions)
|
Percentage Range |
Forecast gross margin
rate on a GAAP basis |
44.6 |
% |
- |
|
45.6 |
% |
Forecast amortization of intangibles |
0.1 |
% |
|
|
Forecast share-based compensation |
0.3 |
% |
|
|
Forecast gross margin rate on a non-GAAP basis |
45.0 |
% |
- |
|
46.0 |
% |
|
Dollar Range |
Forecast operating
expense on a GAAP basis |
|
$56.6 |
|
|
|
|
Forecast share-based compensation |
|
(2.3 |
) |
|
|
|
Forecast Crossroads patent litigation costs |
|
(0.3 |
) |
|
|
|
Forecast operating expense on a non-GAAP basis |
|
$54.0 |
|
|
|
|
|
|
Dollar Range |
Forecast income
(loss) from operations on a GAAP basis |
$ |
(0.1 |
) |
- |
|
$ |
1.9 |
|
Forecast amortization of intangibles |
|
|
|
0.1 |
|
|
|
|
Forecast share-based compensation |
|
|
|
2.7 |
|
|
|
|
Forecast Crossroads patent litigation costs |
|
|
|
0.3 |
|
|
|
|
Forecast income from
operations on a non-GAAP basis |
$ |
3.0 |
|
- |
|
$ |
5.0 |
|
|
|
Dollar Range |
Forecast net loss on
a GAAP basis |
$ |
(2.1 |
) |
- |
|
$ |
(0.1 |
) |
Forecast amortization of intangibles |
|
|
|
0.1 |
|
|
|
|
Forecast share-based compensation |
|
|
|
2.7 |
|
|
|
|
Forecast Crossroads patent litigation costs |
|
|
|
0.3 |
|
|
|
|
Forecast net income
on a non-GAAP basis |
$ |
1.0 |
|
- |
|
$ |
3.0 |
|
|
|
Dollars per Share |
Forecast diluted
earnings per share on a GAAP basis |
$ |
(0.01 |
) |
- |
|
$
|
(0.00 |
) |
Forecast amortization of intangibles |
|
0.00 |
|
|
|
|
Forecast share-based compensation |
|
0.01 |
|
|
|
|
Forecast Crossroads patent litigation costs |
|
0.00 |
|
|
|
|
Forecast diluted
earnings per share on a non-GAAP basis |
$ |
0.00 |
|
- |
|
$ |
0.01 |
|
Estimates based on current
(May 6, 2015) projections.
The projected GAAP and
non-GAAP financial information set forth in this table represent forward-looking
statements within the meaning of the Private Securities Litigation Reform Act of
1995. For risk factors that could impact these projections, see our Annual
Report on Form 10-K as filed with the SEC on June 6, 2014. We disclaim any
obligation to update information in any forward-looking statement.
The non-GAAP financial
information set forth in this table is not prepared in accordance with generally
accepted accounting principles and may be different from non-GAAP financial
information used by other companies.
-end-