|By Business Wire||
|February 6, 2013 04:03 PM EST||
Ixia (Nasdaq: XXIA) today reported its financial results for the fourth quarter and year ended December 31, 2012.
Total revenue for the 2012 fourth quarter was a record $124.1 million, compared with $83.7 million reported for the 2011 fourth quarter and $109.6 million reported for the 2012 third quarter. The 2012 fourth quarter includes $30.3 million in revenue from the recent acquisitions of Anue Systems, Inc. (“Anue”) and BreakingPoint Systems, Inc. (“BreakingPoint”), which closed in June and August 2012, respectively. Excluding Anue and BreakingPoint, fourth quarter revenue grew 12 percent to $93.8 million in 2012 from $83.7 million a year ago.
Total revenue for the fiscal year 2012 was a record $411.7 million, an increase of 34 percent compared with $308.4 million reported for fiscal year 2011. Fiscal year 2012 includes $54.9 million in revenue attributable to Anue and BreakingPoint. For the full year, excluding Anue and BreakingPoint revenue in calendar 2012, revenue grew 16 percent to $356.8 million.
“Our strong fourth quarter capped off a transformational year that included completing two significant acquisitions and achieving record revenue and profit,” commented Vic Alston, Ixia's president and chief executive officer. “In the quarter, demand was strong across our entire solution offering with revenue from our Anue and BreakingPoint solutions exceeding our expectations. We made solid progress expanding our customer base with service provider and enterprise accounts hitting 50 percent of revenue in the quarter.”
Alston continued, “Looking forward into 2013, we intend to continue building on our momentum and growing our presence among service providers and enterprises as we help them optimize their networks and datacenters worldwide to accelerate, secure and scale application delivery.”
On a GAAP basis, the company recorded net income for the 2012 fourth quarter of $4.6 million, or $0.06 per diluted share, compared with net income of $9.8 million, or $0.14 per diluted share, for the 2011 fourth quarter. The company recorded GAAP net income for fiscal year 2012 of $47.2 million, or $0.61 per diluted share, compared with $23.8 million or $0.33 per diluted share, for fiscal year 2011. GAAP results for the fiscal year 2012 include a tax benefit of approximately $37.4 million, or $0.44 per diluted share, for the reversal of valuation allowances related to deferred tax assets.
Non-GAAP net income for the 2012 fourth quarter was a record $19.5 million, or $0.24 per diluted share, compared with non-GAAP net income of $13.7 million, or $0.18 per diluted share, for the 2011 fourth quarter. The company recorded non-GAAP net income for fiscal year 2012 of $60.7 million, or $0.77 per diluted share, compared with $43.8 million, or $0.59 per diluted share, for fiscal year 2011.
Additional non-GAAP information and a reconciliation of our non-GAAP measures to the most directly comparable GAAP financial measures for the 2012 and 2011 fourth quarters and fiscal years may be found in the attached financial tables.
Ixia ended the fourth quarter with approximately $177 million in cash, cash equivalents and investments, compared with $154 million at September 30, 2012.
Conference Call and Webcast Information
Ixia will host a conference call today, at 5:00 p.m., Eastern time, for analysts and investors to discuss its 2012 fourth quarter results and its business outlook for the 2013 first quarter. Open to the public, investors may access the call by dialing 678-825-8347. A live webcast of the conference call, along with supplemental financial information, will be accessible from the "Investors" section of Ixia's web site (www.ixiacom.com). Following the live webcast, an archived version will be available in the "Investors" section on the Ixia web site for 90 days.
To supplement our consolidated financial results prepared in accordance with Generally Accepted Accounting Principles ("GAAP"), we have included certain non-GAAP financial measures in this press release and in the attachments hereto. Specifically, we have provided non-GAAP financial measures (i.e., non-GAAP income from operations, non-GAAP net income, and non-GAAP diluted earnings per share) that exclude certain non-cash and/or non-recurring income and expense items such as proceeds and expenses from certain legal and contractual settlements, stock-based compensation expenses, acquisition and other related costs, restructuring expenses, the amortization of acquisition-related intangible assets, and the related income tax effects of these items, as well as certain other non-cash income tax impacts such as changes in the valuation allowance recorded against certain deferred tax assets. The aforementioned items represent income and expense items that may be difficult to estimate from period to period and/or that we believe are not directly attributable to the underlying performance of our business operations. These non-GAAP financial measures are provided to enhance the user's overall understanding of our financial performance. We believe that by excluding these items, our non-GAAP measures provide supplemental information to both management and investors that is useful in assessing our core operating performance, in evaluating our ongoing business operations and in comparing our results of operations on a consistent basis from period to period. These non-GAAP financial measures are also used by management to plan and forecast future periods and to assist in making operating and strategic decisions. The presentation of this additional information is not prepared in accordance with GAAP. The information therefore may not necessarily be comparable to that of other companies and should be considered as a supplement to, not a substitute for, or superior to, the corresponding measures calculated in accordance with GAAP. Investors are encouraged to review the reconciliations of GAAP to non-GAAP financial measures which are included below in the attached financial tables.
Ixia solutions deliver actionable insight through real-time monitoring, real-world testing, and rapid assessment. This end-to-end visibility provides organizations with a complete understanding into user behavior, security vulnerabilities, network capacity, application performance, and IT resiliency. From the lab to the network to the cloud, Ixia solutions enable its customers to optimize networks and data centers to accelerate, secure, and scale application delivery. For more information, visit www.ixiacom.com.
Safe Harbor under the Private Securities Litigation Reform Act of 1995:
Certain statements made in this press release are forward-looking statements, including, without limitation, statements regarding growth, profitability, financial performance and future business. In some cases, such forward-looking statements can be identified by terms such as may, will, should, expect, plan, believe, estimate, predict or the like. Such statements reflect our current intent, belief and expectations and are subject to risks and uncertainties that could cause our actual results to differ materially from those expressed or implied in the forward-looking statements. Factors that may cause future results to differ materially from our current expectations include the risk that the anticipated benefits and synergies of our recent acquisitions of Anue and BreakingPoint will not be realized, changes in the global economy, competition, consistency of orders from significant customers, our success in developing and producing new products, market acceptance of our products, war, terrorism, political unrest, natural disasters and other circumstances that could, among other consequences, reduce the demand for our products, disrupt our supply chain and/or impact the delivery of our products. Such factors also include those identified in our Annual Report on Form 10-K for the year ended December 31, 2011, and in our other filings with the U.S. Securities and Exchange Commission. We undertake no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise.
Condensed Consolidated Balance Sheets
|December 31,||December 31,|
|Cash and cash equivalents||$||47,508||$||42,729|
|Short-term investments in marketable securities||126,851||156,684|
|Accounts receivable, net||103,587||65,357|
|Prepaid expenses and other current assets||40,278||12,700|
|Total current assets||355,836||304,709|
|Investments in marketable securities||3,119||185,608|
|Property and equipment, net||28,763||25,060|
|Intangible assets, net||157,050||46,028|
|Liabilities and Shareholders’ Equity|
|Accrued expenses and other||51,524||28,196|
|Total current liabilities||134,416||74,164|
|Convertible senior notes||200,000||200,000|
|Common stock, without par value; 200,000 shares authorized at December 31, 2012 and 2011; 74,126 and 70,240 shares issued and outstanding as of December 31, 2012 and 2011, respectively||158,933||132,330|
|Additional paid-in capital||168,980||145,840|
|Accumulated other comprehensive income||2,289||2,230|
|Total shareholders’ equity||441,392||344,362|
|Total liabilities and shareholders’ equity||$||814,948||$||634,467|
Condensed Consolidated Statements of Operations
(in thousands, except per share data)
|Three months ended||Year ended|
|December 31,||December 31,|
|Costs and operating expenses:(1)|
|Cost of revenues – products||21,765||15,602||71,276||56,801|
|Cost of revenues – services||2,898||1,838||10,493||6,520|
|Research and development||29,220||19,105||98,380||75,101|
|Sales and marketing||37,506||22,486||117,302||87,011|
|General and administrative||11,779||7,756||45,443||33,648|
|Amortization of intangible assets||10,758||4,262||30,121||15,980|
|Acquisition and other related||3,389||249||11,861||1,100|
|Total costs and operating expenses||119,294||71,298||388,953||276,161|
|Income from operations||4,825||12,353||22,704||32,195|
|Interest income and other, net||615||246||2,255||2,059|
|Income before income taxes||3,625||10,799||17,744||27,054|
|Income tax (benefit) expense||(970||)||1,035||(29,484||)||3,279|
|Earnings per share:|
|Weighted average number of common and common equivalent shares outstanding:|
|(1) Stock-based compensation included in:|
|Cost of revenues - products||$||167||$||73||$||423||$||402|
|Cost of revenues - services||63||28||162||153|
|Research and development||2,686||912||6,242||4,286|
|Sales and marketing||2,375||750||5,352||3,296|
|General and administrative||2,316||840||7,462||4,454|
Non-GAAP Information and Reconciliation to Most Directly Comparable GAAP Financial Measures
(in thousands, except per share data)
Three months ended
|GAAP income from operations||$||4,825||$||12,353||$||22,704||$||32,195|
|Amortization of intangible assets(b)||10,758||4,262||30,121||15,980|
|Acquisition and other related(c)||3,389||249||11,861||1,100|
|Legal, contract settlements and other(e)||—||(900||)||2,083||—|
|Non-GAAP income from operations||$||29,222||$||18,567||$||91,483||$||61,866|
|GAAP net income||$||4,595||$||9,764||$||47,228||$||23,775|
|Amortization of intangible assets(b)||10,758||4,262||30,121||15,980|
|Acquisition and other related(c)||3,389||249||11,861||1,100|
|Legal, contract settlements and other(e)||—||(900||)||2,083||—|
|Income tax effect related to non-GAAP adjustments(g)||(9,529||)||(2,237||)||(55,324||)||(9,667||)|
|Non-GAAP net income||$||19,463||$||13,741||$||60,683||$||43,779|
|GAAP diluted earnings per share||$||0.06||$||0.14||$||0.61||$||0.33|
|Amortization of intangible assets(b)||0.14||0.06||0.36||0.22|
|Acquisition and other related(c)||0.04||—||0.14||0.02|
|Legal, contract settlements and other(e)||—||(0.02||)||0.02||—|
|Income tax effect related to non-GAAP adjustments(g)||(0.13||)||(0.03||)||(0.65||)||(0.14||)|
|Convertible senior notes(h)||(0.01||)||(0.01||)||—||(0.02||)|
|Non-GAAP diluted earnings per share||$||0.24||$||0.18||$||0.77||$||0.59|
|Shares used in computing GAAP diluted earnings per common share||
|Effect of reconciling item(h)(i)||10,224||10,059||(223||)||10,052|
Shares used in computing non-GAAP diluted earnings per common share
|(a)||This reconciling item represents stock-based compensation expenses. As stock-based compensation represents a non-cash charge that is not directly attributable to the underlying performance of our business operations, we believe that by excluding stock-based compensation, investors are provided with supplemental information that is useful in comparing our operating results from period to period and in evaluating our core operations and performance. While we expect to continue to recognize stock-based compensation expense in the future, management also excludes this expense when evaluating current performance, forecasting future results, measuring core operating results, and making operating and strategic decisions.|
|(b)||This reconciling item represents the amortization of intangible assets related to the acquisitions of various businesses and technologies such as the acquisitions of Catapult Communications Corporation, Agilent Technologies’ N2X Data Network Testing Product line, VeriWave, Inc., Anue Systems, Inc. and BreakingPoint Systems, Inc. As the amortization expense represents a non-cash charge that is not directly attributable to the underlying performance of our business operations, we believe that by excluding the amortization of acquisition-related intangible assets, we provide investors with supplemental information that is useful in evaluating our ongoing operations and performance. While the amortization of acquisition-related intangible assets is expected to continue in the future, management also excludes this expense when evaluating current performance, forecasting future results, measuring core operating results, and making operating and strategic decisions.|
|(c)||This reconciling item represents costs associated with acquisition-related activities. Acquisition and other related costs consist primarily of transaction and integration related costs such as success-based banking fees, professional fees for legal, accounting and tax services, integration related consulting fees, amortization of deferred consideration payable to certain pre-acquisition employees of BreakingPoint Systems, Inc., certain employee, facility and infrastructure costs, and other related expenses. We believe that by excluding acquisition and other related costs, we provide investors with supplemental information that is useful in comparing our ongoing operating results from period to period and in evaluating our core operations and performance.|
|(d)||This reconciling item represents costs associated with our restructuring/reorganization plans in light of our acquisition of BreakingPoint Systems, Inc. These costs primarily relate to one-time employee termination benefits consisting of severance and other related costs, and costs related to the closure of our office in Melbourne, Australia. We believe that by excluding restructuring costs, we provide investors with supplemental information that is useful in comparing our operating results from period to period and in evaluating our core operations and performance.|
|(e)||This reconciling item represents a one-time charge of $900,000 incurred in the first quarter of 2011 to terminate and settle a development contract, a one-time reversal of $900,000 incurred in the fourth quarter of 2011 related to certain legal and contractual matters, a one-time transition charge of $1.7 million incurred in the first quarter of 2012 in connection with the departure of our former CEO and a one-time charge of $401,000 incurred in the second quarter of 2012 to settle a legal matter. We believe that by excluding these charges, we provide our investors with supplemental information that is useful in comparing our operating results from period to period and in evaluating our core operations and performance.|
|(f)||This reconciling item relates to the purchase price accounting adjustment associated with the fair value of inventory as a result of the acquisition of BreakingPoint Systems, Inc. recorded in the third and fourth quarters of 2012. While we may have similar charges in the future resulting from purchase price accounting adjustments, management excludes these expenses when evaluating current performance, forecasting future results, measuring core operating results, and making operating and strategic decisions. We believe that by excluding these charges, we provide investors with supplemental information that is useful in comparing our operating results from period to period and in evaluating our core operations and performance.|
|(g)||This adjustment represents the income tax effects of the reconciling items noted in footnotes (a), (b), (c), (d), (e) and (f) as well as certain other non-cash income tax impacts such as changes in the valuation allowance relating to the company’s deferred tax assets. We recorded partial release of our valuation allowance of $22.6 million, $12.7 million and $2.1 million, in the second, third and fourth quarters of 2012, respectively.|
|(h)||This reconciling item for the non-GAAP diluted earnings per share calculation for the three and twelve months ended December 31, 2011 and for the three months ended December 31, 2012 includes the impact of the convertible senior notes as these were anti-dilutive for the equivalent GAAP earnings per share calculations.|
|(i)||This adjustment represents the effects of stock-based compensation on diluted common equivalent shares outstanding as well as any adjustments required due to a change from a net loss to a net income position.|
With the Apple Watch making its way onto wrists all over the world, it’s only a matter of time before it becomes a staple in the workplace. In fact, Forrester reported that 68 percent of technology and business decision-makers characterize wearables as a top priority for 2015. Recognizing their business value early on, FinancialForce.com was the first to bring ERP to wearables, helping streamline communication across front and back office functions. In his session at @ThingsExpo, Kevin Roberts...
Sep. 5, 2015 06:00 AM EDT Reads: 132
[session] Critical IoT Communications By @ImadMouline | @ThingsExpo #M2M #API #RTC #WebRTC #InternetofThings
Contrary to mainstream media attention, the multiple possibilities of how consumer IoT will transform our everyday lives aren’t the only angle of this headline-gaining trend. There’s a huge opportunity for “industrial IoT” and “Smart Cities” to impact the world in the same capacity – especially during critical situations. For example, a community water dam that needs to release water can leverage embedded critical communications logic to alert the appropriate individuals, on the right device, as...
Sep. 5, 2015 05:15 AM EDT Reads: 141
[session] Start Thinking ‘Service By @AylaNetworks | @ThingsExpo #IoT #M2M #API #RTC #InternetOfThings
Manufacturing connected IoT versions of traditional products requires more than multiple deep technology skills. It also requires a shift in mindset, to realize that connected, sensor-enabled “things” act more like services than what we usually think of as products. In his session at @ThingsExpo, David Friedman, CEO and co-founder of Ayla Networks, will discuss how when sensors start generating detailed real-world data about products and how they’re being used, smart manufacturers can use the ...
Sep. 5, 2015 05:00 AM EDT Reads: 112
In his session at @ThingsExpo, Lee Williams, a producer of the first smartphones and tablets, will talk about how he is now applying his experience in mobile technology to the design and development of the next generation of Environmental and Sustainability Services at ETwater. He will explain how M2M controllers work through wirelessly connected remote controls; and specifically delve into a retrofit option that reverse-engineers control codes of existing conventional controller systems so the...
Sep. 5, 2015 05:00 AM EDT Reads: 294
To assist customers with legacy Windows Server 2003 that is no longer supported by Microsoft, Racemi has introduced fixed price packages for upgrading and migrating Windows Server 2003 servers to either Windows 2008 R2 or Windows 2012 R2 and the choice of Amazon Web Services (AWS) or SoftLayer cloud. "We're extending a lifeline by upgrading the legacy servers to more modern Windows Server platforms while taking advantage of cloud computing," said James Strayer, vice president of product managem...
Sep. 5, 2015 03:30 AM EDT Reads: 117
SYS-CON Events announced today that HPM Networks will exhibit at the 17th International Cloud Expo®, which will take place on November 3–5, 2015, at the Santa Clara Convention Center in Santa Clara, CA. For 20 years, HPM Networks has been integrating technology solutions that solve complex business challenges. HPM Networks has designed solutions for both SMB and enterprise customers throughout the San Francisco Bay Area.
Sep. 5, 2015 01:30 AM EDT Reads: 1,006
SYS-CON Events announced today that Pythian, a global IT services company specializing in helping companies leverage disruptive technologies to optimize revenue-generating systems, has been named “Bronze Sponsor” of SYS-CON's 17th Cloud Expo, which will take place on November 3–5, 2015, at the Santa Clara Convention Center in Santa Clara, CA. Founded in 1997, Pythian is a global IT services company that helps companies compete by adopting disruptive technologies such as cloud, Big Data, advance...
Sep. 5, 2015 01:00 AM EDT Reads: 418
All major researchers estimate there will be tens of billions devices - computers, smartphones, tablets, and sensors - connected to the Internet by 2020. This number will continue to grow at a rapid pace for the next several decades. With major technology companies and startups seriously embracing IoT strategies, now is the perfect time to attend @ThingsExpo, November 3-5, 2015, at the Santa Clara Convention Center in Santa Clara, CA. Learn what is going on, contribute to the discussions, and e...
Sep. 5, 2015 01:00 AM EDT Reads: 265
SYS-CON Events announced today that G2G3 will exhibit at SYS-CON's @DevOpsSummit Silicon Valley, which will take place on November 3–5, 2015, at the Santa Clara Convention Center in Santa Clara, CA. Based on a collective appreciation for user experience, design, and technology, G2G3 is uniquely qualified and motivated to redefine how organizations and people engage in an increasingly digital world.
Sep. 4, 2015 11:00 PM EDT Reads: 585
In their Live Hack” presentation at 17th Cloud Expo, Stephen Coty and Paul Fletcher, Chief Security Evangelists at Alert Logic, will provide the audience with a chance to see a live demonstration of the common tools cyber attackers use to attack cloud and traditional IT systems. This “Live Hack” uses open source attack tools that are free and available for download by anybody. Attendees will learn where to find and how to operate these tools for the purpose of testing their own IT infrastructu...
Sep. 4, 2015 09:30 PM EDT Reads: 546
DevOps Summit, taking place Nov 3-5, 2015, at the Santa Clara Convention Center in Santa Clara, CA, is co-located with 17th Cloud Expo and will feature technical sessions from a rock star conference faculty and the leading industry players in the world. The widespread success of cloud computing is driving the DevOps revolution in enterprise IT. Now as never before, development teams must communicate and collaborate in a dynamic, 24/7/365 environment. There is no time to wait for long development...
Sep. 4, 2015 07:00 PM EDT Reads: 1,670
Too often with compelling new technologies market participants become overly enamored with that attractiveness of the technology and neglect underlying business drivers. This tendency, what some call the “newest shiny object syndrome,” is understandable given that virtually all of us are heavily engaged in technology. But it is also mistaken. Without concrete business cases driving its deployment, IoT, like many other technologies before it, will fade into obscurity.
Sep. 4, 2015 06:45 PM EDT Reads: 458
SYS-CON Events announced today that DataClear Inc. will exhibit at the 17th International Cloud Expo®, which will take place on November 3–5, 2015, at the Santa Clara Convention Center in Santa Clara, CA. The DataClear ‘BlackBox’ is the only solution that moves your PC, browsing and data out of the United States and away from prying (and spying) eyes. Its solution automatically builds you a clean, on-demand, virus free, new virtual cloud based PC outside of the United States, and wipes it clean...
Sep. 4, 2015 05:30 PM EDT Reads: 510
With the proliferation of connected devices underpinning new Internet of Things systems, Brandon Schulz, Director of Luxoft IoT – Retail, will be looking at the transformation of the retail customer experience in brick and mortar stores in his session at @ThingsExpo. Questions he will address include: Will beacons drop to the wayside like QR codes, or be a proximity-based profit driver? How will the customer experience change in stores of all types when everything can be instrumented and a...
Sep. 4, 2015 04:15 PM EDT Reads: 536
Organizations from small to large are increasingly adopting cloud solutions to deliver essential business services at a much lower cost. According to cyber security experts, the frequency and severity of cyber-attacks are on the rise, causing alarm to businesses and customers across a variety of industries. To defend against exploits like these, a company must adopt a comprehensive security defense strategy that is designed for their business. In 2015, organizations such as United Airlines, Sony...
Sep. 4, 2015 03:30 PM EDT Reads: 551
Any Ops team trying to support a company in today’s cloud-connected world knows that a new way of thinking is required – one just as dramatic than the shift from Ops to DevOps. The diversity of modern operations requires teams to focus their impact on breadth vs. depth. In his session at DevOps Summit, Adam Serediuk, Director of Operations at xMatters, Inc., will discuss the strategic requirements of evolving from Ops to DevOps, and why modern Operations has begun leveraging the “NoOps” approa...
Sep. 4, 2015 03:30 PM EDT Reads: 476
In today's digital world, change is the one constant. Disruptive innovations like cloud, mobility, social media, and the Internet of Things have reshaped the market and set new standards in customer expectations. To remain competitive, businesses must tap the potential of emerging technologies and markets through the rapid release of new products and services. However, the rigid and siloed structures of traditional IT platforms and processes are slowing them down – resulting in lengthy delivery ...
Sep. 4, 2015 01:45 PM EDT Reads: 667
SYS-CON Events announced today that Micron Technology, Inc., a global leader in advanced semiconductor systems, will exhibit at the 17th International Cloud Expo®, which will take place on November 3–5, 2015, at the Santa Clara Convention Center in Santa Clara, CA. Micron’s broad portfolio of high-performance memory technologies – including DRAM, NAND and NOR Flash – is the basis for solid state drives, modules, multichip packages and other system solutions. Backed by more than 35 years of tech...
Sep. 4, 2015 12:00 PM EDT Reads: 300
SYS-CON Events announced today that IceWarp will exhibit at the 17th International Cloud Expo®, which will take place on November 3–5, 2015, at the Santa Clara Convention Center in Santa Clara, CA. IceWarp, the leader of cloud and on-premise messaging, delivers secured email, chat, documents, conferencing and collaboration to today's mobile workforce, all in one unified interface
Sep. 4, 2015 12:00 PM EDT Reads: 508
U.S. companies are desperately trying to recruit and hire skilled software engineers and developers, but there is simply not enough quality talent to go around. Tiempo Development is a nearshore software development company. Our headquarters are in AZ, but we are a pioneer and leader in outsourcing to Mexico, based on our three software development centers there. We have a proven process and we are experts at providing our customers with powerful solutions. We transform ideas into reality.
Sep. 4, 2015 11:45 AM EDT Reads: 589