Infinera Corporation Reports Fourth Quarter and Fiscal Year 2015 Financial Results
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SUNNYVALE, CA -- (Marketwired) -- 02/11/16 -- Infinera Corporation, provider of Intelligent Transport Networks, today released financial results for the fourth quarter and fiscal year ended December 26, 2015.
GAAP revenue for the quarter was $260.0 million compared to $232.5 million in the third quarter of 2015 and $186.3 million in the fourth quarter of 2014.
GAAP gross margin for the quarter was 44.5% compared to 44.2% in the third quarter of 2015 and 45.3% in the fourth quarter of 2014. GAAP operating margin for the quarter was 5.3% compared to 6.1% in the third quarter of 2015 and 6.9% in the fourth quarter of 2014.
GAAP net income for the quarter was $12.6 million, or $0.08 per diluted share, compared to $8.5 million, or $0.06 per diluted share, in the third quarter of 2015, and $8.4 million, or $0.06 per diluted share, in the fourth quarter of 2014.
Non-GAAP revenue for the quarter was $260.6 million compared to $233.2 million in the third quarter of 2015 and $186.3 million in the fourth quarter of 2014.
Non-GAAP gross margin for the quarter was 48.3% compared to 47.5% in the third quarter of 2015 and 46.1% in the fourth quarter of 2014. Non-GAAP operating margin for the quarter was 12.7% compared to 14.4% in the third quarter of 2015 and 11.0% in the fourth quarter of 2014.
Non-GAAP net income for the quarter was $32.0 million, or $0.21 per diluted share, compared to $32.2 million, or $0.22 per diluted share, in the third quarter of 2015, and $18.0 million, or $0.13 per diluted share, in the fourth quarter of 2014.
GAAP revenue for the year was $886.7 million compared to $668.1 million in 2014.
GAAP gross margin for the year was 45.5% compared to 43.2% in 2014. GAAP operating margin for the year was 6.7% compared to 4.1% in 2014. GAAP net income for the year was $51.4 million, or $0.36 per diluted share, compared to $13.7 million, or $0.11 per diluted share in 2014.
Non-GAAP revenue for the year was $888.0 million compared to $668.1 million in 2014.
Non-GAAP gross margin for the year was 47.8% compared to 44.0% in 2014. Non-GAAP operating margin for the year was 13.1% compared to 8.3% in 2014. Non-GAAP net income for the year was $112.0 million, or $0.78 per diluted share, compared to $49.8 million, or $0.39 per diluted share in 2014.
A further explanation of the use of non-GAAP financial information and a reconciliation of the non-GAAP financial measures to the GAAP equivalents can be found at the end of this release.
"Our fourth quarter performance capped off an exceptional year of revenue and profitability growth, expansion of our product portfolio to serve the end-to-end market and the continuation of our commitment to deliver the Infinera Experience to our customers," said Tom Fallon, Infinera's Chief Executive Officer.
"With customers increasingly relying on optical transport as the foundation of their next generation networks, Infinera will continue to deliver the most innovative, scalable and programmable Intelligent Transport solutions in the industry. We exited 2015 on a $1 billion annual revenue run rate and are well positioned to address the significant future opportunities associated with this optical networking transformation."
Conference Call Information
Infinera will host a conference call for analysts and investors to discuss its fourth quarter and fiscal year 2015 results and its outlook for the first quarter of 2016 today at 5:00 p.m. Eastern Time (2:00 p.m. Pacific Time). Interested parties may join the conference call by dialing 1-866-270-1533 (toll free) or 1-412-317-0797 (international). A live webcast of the conference call will also be accessible from the Events & Webcasts section of Infinera's website at investors.infinera.com. Replay of the audio webcast will be available at investors.infinera.com approximately two hours after the end of the live call.
About Infinera
Infinera (NASDAQ: INFN) provides Intelligent Transport Networks, enabling carriers, cloud operators, governments and enterprises to scale network bandwidth, accelerate service innovation and simplify optical network operations. Infinera's end-to-end packet-optical portfolio is designed for long-haul, subsea, datacenter interconnect and metro applications. Infinera's unique large scale photonic integrated circuits enable innovative optical networking solutions for the most demanding networks. To learn more about Infinera visit www.infinera.com, follow us on Twitter @Infinera and read our latest blog posts at blog.infinera.com.
Forward-Looking Statements
This press release contains certain forward-looking statements based on current expectations, forecasts and assumptions that involve risks and uncertainties. Such forward-looking statements include, without limitation, Infinera's ability to continue to deliver the most innovative, scalable and programmable Intelligent Transport solutions in the industry; and Infinera's ability to address future opportunities in the optical networking market. Forward-looking statements can also be identified by forward-looking words such as "anticipate," "believe," "could," "estimate," "expect," "intend," "may," "should," "will," and "would" or similar words. These statements are based on information available to Infinera as of the date hereof and actual results could differ materially from those stated or implied due to risks and uncertainties. The risks and uncertainties that could cause Infinera's results to differ materially from those expressed or implied by such forward-looking statements include delays in the development and introduction of new products or updates to existing products and market acceptance of these products; Infinera's ability to successfully integrate the Infinera and Transmode businesses; the effect that changes in product pricing or mix, and/or increases in component costs could have on Infinera's gross margin; Infinera's ability to respond to rapid technological changes; Infinera's reliance on single-source suppliers; aggressive business tactics by Infinera's competitors; Infinera's ability to protect Infinera's intellectual property; claims by others that Infinera infringes their intellectual property; global macroeconomic conditions; war, terrorism, public health issues, natural disasters and other circumstances that could disrupt supply, delivery or demand of products; and other risks and uncertainties detailed in Infinera's SEC filings from time to time. More information on potential factors that may impact Infinera's business are set forth in its Quarterly Report on Form 10-Q for the quarter ended on September 26, 2015 as filed with the SEC on November 5, 2015, as well as subsequent reports filed with or furnished to the SEC from time to time. These reports are available on Infinera's website at www.infinera.com and the SEC's website at www.sec.gov. Infinera assumes no obligation to, and does not currently intend to, update any such forward-looking statements.
Use of Non-GAAP Financial Information
In addition to disclosing financial measures prepared in accordance with U.S. Generally Accepted Accounting Principles (GAAP), this press release and the accompanying tables contain certain non-GAAP measures that exclude non-cash stock-based compensation expenses, acquisition-related costs, certain purchase accounting adjustments and amortization of debt discount on Infinera's convertible senior notes. Infinera believes these adjustments are appropriate to enhance an overall understanding of its underlying financial performance and also its prospects for the future and are considered by management for the purpose of making operational decisions. In addition, these results are the primary indicators management uses as a basis for its planning and forecasting of future periods. The presentation of this additional information is not meant to be considered in isolation or as a substitute for net income, basic and diluted net income per share, gross margin or operating margin prepared in accordance with GAAP. Non-GAAP financial measures are not based on a comprehensive set of accounting rules or principles and are subject to limitations. For a description of these non-GAAP financial measures and a reconciliation to the most directly comparable GAAP financial measures, please see the section titled, "GAAP to Non-GAAP Reconciliations." Infinera anticipates disclosing forward-looking non-GAAP information in its conference call to discuss its fourth quarter and fiscal year 2015 results, including an estimate of certain non-GAAP financial measures for the first quarter of 2016 that excludes non-cash stock-based compensation expenses, acquisition-related costs, certain purchase accounting adjustments and amortization of debt discount on Infinera's convertible senior notes.
A copy of this press release can be found on the Investor Relations page of Infinera's website at www.infinera.com.
Infinera and the Infinera logo are trademarks or registered trademarks of Infinera Corporation. All other trademarks used or mentioned herein belong to their respective owners.
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Infinera Corporation
GAAP Condensed Consolidated Statements of Operations
(In thousands, except per share data)
(Unaudited)
Three Months Ended Twelve Months Ended
-------------------------- --------------------------
December 26, December 27, December 26, December 27,
2015 2014 2015 2014
------------ ------------ ------------ ------------
Revenue:
Product $ 227,040 $ 158,492 $ 769,230 $ 572,276
Services 32,994 27,814 117,484 95,803
------------ ------------ ------------ ------------
Total revenue 260,034 186,306 886,714 668,079
Cost of revenue:
Cost of product 130,765 89,809 436,916 340,856
Cost of services 13,505 12,154 46,321 38,919
------------ ------------ ------------ ------------
Total cost of
revenue 144,270 101,963 483,237 379,775
Gross profit 115,764 84,343 403,477 288,304
Operating expenses:
Research and
development 52,559 37,349 180,703 133,484
Sales and marketing 34,100 22,288 101,398 79,026
General and
administrative 15,316 11,840 61,640 48,452
------------ ------------ ------------ ------------
Total operating
expenses 101,975 71,477 343,741 260,962
Income from
operations 13,789 12,866 59,736 27,342
Other income
(expense), net:
Interest income 466 410 1,837 1,456
Interest expense (3,090) (2,835) (11,941) (11,021)
Other gain (loss),
net 611 (348) 2,399 (1,365)
------------ ------------ ------------ ------------
Total other income
(expense), net (2,013) (2,773) (7,705) (10,930)
Income before income
taxes 11,776 10,093 52,031 16,412
Provision for
(benefit from)
income taxes (392) 1,683 1,081 2,753
------------ ------------ ------------ ------------
Net income 12,168 8,410 50,950 13,659
Less: Net loss
attributable to
noncontrolling
interest (463) - (463) -
------------ ------------ ------------ ------------
Net income
attributable to
Infinera
Corporation $ 12,631 $ 8,410 $ 51,413 $ 13,659
============ ============ ============ ============
Net income per
common share
attributable
to Infinera
Corporation:
Basic $ 0.09 $ 0.07 $ 0.39 $ 0.11
============ ============ ============ ============
Diluted $ 0.08 $ 0.06 $ 0.36 $ 0.11
============ ============ ============ ============
Weighted average
shares used in
computing
net income per
common share:
Basic 140,015 125,830 133,259 123,672
============ ============ ============ ============
Diluted 149,439 133,072 143,171 128,565
============ ============ ============ ============
------------------------------------------------------
Infinera Corporation
GAAP to Non-GAAP Reconciliations
(In thousands, except percentages and per share data)
(Unaudited)
Three Months Ended
------------------------------------------------
December 26, September 26, December 27,
2015 2015 2014
--------------- --------------- --------------
Reconciliation of
Revenue:
U.S. GAAP as reported $ 260,034 $ 232,472 $ 186,306
Acquisition-related
deferred revenue
adjustment(1) 605 721 -
--------- --------- ---------
Non-GAAP as adjusted $ 260,639 $ 233,193 $ 186,306
========= ========= =========
Reconciliation of Gross
Profit:
U.S. GAAP as reported $ 115,764 44.5% $ 102,805 44.2% $ 84,343 45.3%
Stock-based
compensation(2) 1,733 1,621 1,472
Acquisition-related
deferred revenue
adjustment(1) 605 721 -
Amortization of acquired
intangible assets(3) 4,640 1,922 -
Acquisition-related
inventory step-up
expense(4) 3,090 3,620 -
Acquisition-related
costs(5) 39 - -
--------- ---- --------- ---- --------- ----
Non-GAAP as adjusted $ 125,871 48.3% $ 110,689 47.5% $ 85,815 46.1%
========= ==== ========= ==== ========= ====
Reconciliation of
Operating Expenses:
U.S. GAAP as reported $ 101,975 $ 88,545 $ 71,477
Stock-based
compensation(2) 6,979 6,830 6,075
Amortization of acquired
intangible assets(3) 1,656 686 -
Acquisition-related
costs(5) 565 3,950 -
--------- --------- ---------
Non-GAAP as adjusted $ 92,775 $ 77,079 $ 65,402
========= ========= =========
Reconciliation of Income
from Operations:
U.S. GAAP as reported $ 13,789 5.3% $ 14,260 6.1% $ 12,866 6.9%
Stock-based
compensation(2) 8,712 8,451 7,547
Acquisition-related
deferred revenue
adjustment(1) 605 721 -
Amortization of acquired
intangible assets(3) 6,296 2,608 -
Acquisition-related
inventory step-up
expense(4) 3,090 3,620 -
Acquisition-related
costs(5) 604 3,950 -
--------- ---- --------- ---- --------- ----
Non-GAAP as adjusted $ 33,096 12.7% $ 33,610 14.4% $ 20,413 11.0%
========= ==== ========= ==== ========= ====
Reconciliation of Net
Income Attributable
to Infinera Corporation:
U.S. GAAP as reported $ 12,631 $ 8,510 $ 8,410
Stock-based
compensation(2) 8,712 8,451 7,547
Acquisition-related
deferred revenue
adjustment(1) 605 721 -
Amortization of acquired
intangible assets(3) 6,296 2,608 -
Acquisition-related
inventory step-up
expense(4) 3,090 3,620 -
Acquisition-related
costs(5) 604 3,950 -
Acquisition-related
forward contract (gain)
loss(6) - 3,728 -
Amortization of debt
discount(7) 2,217 2,162 2,006
Income tax effects(8) (2,197) (1,529) -
--------- --------- ---------
Non-GAAP as adjusted $ 31,958 $ 32,221 $ 17,963
========= ========= =========
Net Income per Common
Share Attributable to
Infinera Corporation -
Basic:
U.S. GAAP as reported $ 0.09 $ 0.06 $ 0.07
========= ========= =========
Non-GAAP as adjusted $ 0.23 $ 0.24 $ 0.14
========= ========= =========
Net Income per Common
Share Attributable to
Infinera Corporation -
Diluted:
U.S. GAAP as reported $ 0.08 $ 0.06 $ 0.06
========= ========= =========
Non-GAAP as adjusted $ 0.21 $ 0.22 $ 0.13
========= ========= =========
Weighted Average Shares
Used in Computing Net
Income
per Common Share:
Basic 140,015 134,834 125,830
========= ========= =========
Diluted 149,439 145,300 133,072
========= ========= =========
Twelve Months Ended
-------------------------------
December 26, December 27,
2015 2014
--------------- --------------
Reconciliation of
Revenue:
U.S. GAAP as reported $ 886,714 $ 668,079
Acquisition-related
deferred revenue
adjustment(1) 1,326 -
--------- ---------
Non-GAAP as adjusted $ 888,040 $ 668,079
========= =========
Reconciliation of Gross
Profit:
U.S. GAAP as reported $ 403,477 45.5% $ 288,304 43.2%
Stock-based
compensation(2) 6,090 5,607
Acquisition-related
deferred revenue
adjustment(1) 1,326 -
Amortization of acquired
intangible assets(3) 6,562 -
Acquisition-related
inventory step-up
expense(4) 6,710 -
Acquisition-related
costs(5) 39 -
--------- ---- --------- ----
Non-GAAP as adjusted $ 424,204 47.8% $ 293,911 44.0%
========= ==== ========= ====
Reconciliation of
Operating Expenses:
U.S. GAAP as reported $ 343,741 $ 260,962
Stock-based
compensation(2) 26,490 22,787
Amortization of acquired
intangible assets(3) 2,342 -
Acquisition-related
costs(5) 7,241 -
--------- ---------
Non-GAAP as adjusted $ 307,668 $ 238,175
========= =========
Reconciliation of Income
from Operations:
U.S. GAAP as reported $ 59,736 6.7% $ 27,342 4.1%
Stock-based
compensation(2) 32,580 28,394
Acquisition-related
deferred revenue
adjustment(1) 1,326 -
Amortization of acquired
intangible assets(3) 8,904 -
Acquisition-related
inventory step-up
expense(4) 6,710 -
Acquisition-related
costs(5) 7,280 -
--------- ---- --------- ----
Non-GAAP as adjusted $ 116,536 13.1% $ 55,736 8.3%
========= ==== ========= ====
Reconciliation of Net
Income Attributable
to Infinera Corporation:
U.S. GAAP as reported $ 51,413 $ 13,659
Stock-based
compensation(2) 32,580 28,394
Acquisition-related
deferred revenue
adjustment(1) 1,326 -
Amortization of acquired
intangible assets(3) 8,904 -
Acquisition-related
inventory step-up
expense(4) 6,710 -
Acquisition-related
costs(5) 7,280 -
Acquisition-related
forward contract (gain)
loss(6) (1,054) -
Amortization of debt
discount(7) 8,545 7,730
Income tax effects(8) (3,726) -
--------- ---------
Non-GAAP as adjusted $ 111,978 $ 49,783
========= =========
Net Income per Common
Share Attributable to
Infinera Corporation -
Basic:
U.S. GAAP as reported $ 0.39 $ 0.11
========= =========
Non-GAAP as adjusted $ 0.84 $ 0.40
========= =========
Net Income per Common
Share Attributable to
Infinera Corporation -
Diluted:
U.S. GAAP as reported $ 0.36 $ 0.11
========= =========
Non-GAAP as adjusted $ 0.78 $ 0.39
========= =========
Weighted Average Shares
Used in Computing Net
Income
per Common Share:
Basic 133,259 123,672
========= =========
Diluted 143,171 128,565
========= =========
Infinera Corporation GAAP to Non-GAAP Reconciliations (In thousands, except percentages and per share data) (Unaudited)
(1) Business combination accounting principles require Infinera to write down to fair value its maintanence support contracts assumed in the Transmode acquisition. The revenue for these support contracts is deferred and typically recognized over a one year period, so Infinera's GAAP revenue for the one year period after the acquisition will not reflect the full amount of revenue that would have been reported if the acquired deferred revenue was not written down to fair value. The non-GAAP adjustment eliminates the effect of the deferred revenue write-down. Management believes these adjustments to the revenue from these support contracts are useful to investors as an additional means to reflect revenue trends of Infinera's business.
(2) Stock-based compensation expense is calculated in accordance with the fair value recognition provisions of Financial Accounting Standards Board Accounting Standards Codification Topic 718, Compensation-Stock Compensation effective January 1, 2006. The following table summarizes the effects of stock-based compensation related to employees and non-employees (in thousands):
Three Months Ended Twelve Months Ended
----------------------------------- -----------------------
December September December December December
26, 26, 27, 26, 27,
2015 2015 2014 2015 2014
----------- ----------- ----------- ----------- -----------
Cost of revenue $ 665 $ 645 $ 500 $ 2,405 $ 1,921
Research and
development 2,872 2,788 2,439 11,055 8,927
Sales and
marketing 2,159 2,131 1,960 8,081 7,477
General and
administration 1,948 1,911 1,676 7,354 6,383
----------- ----------- ----------- ----------- -----------
7,644 7,475 6,575 28,895 24,708
Cost of revenue
- amortization
from balance
sheet* 1,068 976 972 3,685 3,686
----------- ----------- ----------- ----------- -----------
Total stock-
based
compensation
expense $ 8,712 $ 8,451 $ 7,547 $ 32,580 $ 28,394
=========== =========== =========== =========== ===========
----------------
* Stock-based compensation expense deferred to
inventory and deferred inventory costs in prior
periods and recognized in the current period.
(3)
Amortization of acquisition-related intangible assets consists of amortization of developed technology, trade names, and customer relationships acquired in connection with the Transmode acquisition. U.S. GAAP accounting requires that acquired intangible assets are recorded at fair value and amortized over their useful lives. As this amortization is non-cash, Infinera has excluded it from its non-GAAP operating expenses, gross margin and net income measures. Management believes the amortization of acquired intangible assets is not indicative of ongoing operating performance and its exclusion provide a better indication of Infinera's underlying business performance.
(4)
Business combination accounting principles require Infinera to measure acquired inventory at fair value as of the date of the acquisition. The fair value of inventory reflects the acquired company's cost of manufacturing plus a portion of the expected profit margin. The non-GAAP adjustment to Infinera's cost of sales excludes the amortization of the step-up in carrying value for units sold in the quarter. Management believes the adjustment is useful to investors as an additional means to reflect cost of sales and gross margin trends of Infinera's business.
(5)
Acquisition-related costs related to Transmode acquisition, which closed during the third quarter of 2015, include legal, financial, employee retention costs and other professional fees incurred in connection with the transaction. These amounts have been adjusted in arriving at Infinera's non-GAAP results because management believes that these expenses are non-recurring, not indicative of ongoing operating performance and their exclusion provides a better indication of Infinera's underlying business performance.
(6)
In April 2015, Infinera entered into a foreign currency forward contract and in July 2015, Infinera entered into a series of foreign currency exchange option contracts to hedge currency exposures associated with the cash portion of the offer to acquire Transmode. The forward contract and option contracts were subsequently closed during the third quarter of 2015. Management has excluded the impact of these gains and losses from Infinera's non-GAAP results because they are non-recurring and management believes that these gains are not indicative of ongoing operating performance.
(7)
Under GAAP, certain convertible debt instruments that may be settled in cash on conversion are required to be separately accounted for as liability (debt) and equity (conversion option) components of the instrument in a manner that reflects the issuer's non-convertible debt borrowing rate. Accordingly, for GAAP purposes, Infinera is required to amortize as a debt discount an amount equal to the fair value of the conversion option that was recorded in equity as interest expense on its $150 million 1.75% convertible debt issuance in May 2013 over the term of the notes. Interest expense has been excluded from Infinera's non-GAAP results because management believes that this non-cash expense is not indicative of ongoing operating performance and provides a better indication of Infinera's underlying business performance.
(8)
The difference between the GAAP and non-GAAP tax is due to the net tax effects of the purchase accounting adjustments related to the Transmode acquisition, which closed during the third quarter of 2015.
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Infinera Corporation
Condensed Consolidated Balance Sheets
(In thousands, except par values)
(Unaudited)
December 26, December 27,
2015 2014
------------- -------------
ASSETS
Current assets:
Cash and cash equivalents $ 149,101 $ 86,495
Short-term investments 125,561 239,628
Accounts receivable, net of allowance for
doubtful accounts
of $624 in 2015 and $38 in 2014 186,243 154,596
Inventory 174,699 146,500
Prepaid expenses and other current assets 29,511 24,636
------------- -------------
Total current assets 665,115 651,855
Property, plant and equipment, net 110,861 81,566
Intangible assets, net 156,319 361
Goodwill 191,560 -
Long-term investments 76,507 59,233
Cost-method investment 14,500 14,500
Long-term restricted cash 5,310 5,460
Other non-current assets 6,122 5,041
------------- -------------
Total assets $ 1,226,294 $ 818,016
============= =============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 92,554 $ 61,533
Accrued expenses 33,736 26,441
Accrued compensation and related benefits 49,887 38,795
Accrued warranty 17,889 12,241
Deferred revenue 42,977 35,321
------------- -------------
Total current liabilities 237,043 174,331
Long-term debt, net 125,440 116,894
Accrued warranty, non-current 20,955 14,799
Deferred revenue, non-current 13,881 10,758
Deferred tax Iiability, non-current 35,731 2,132
Other long-term liabilities 16,183 17,195
Commitments and contingencies
Stockholders' equity:
Preferred stock, $0.001 par value
Authorized shares - 25,000 and no shares
issued and outstanding - -
Common stock, $0.001 par value
Authorized shares - 500,000 as of December 26, 2015 and
December 27, 2014
Issued and outstanding shares - 140,196 as of December
26, 2015 and 126,160
as of December 27, 2014 140 126
Additional paid-in capital 1,300,301 1,077,225
Accumulated other comprehensive income
(loss) 1,123 (4,618)
Accumulated deficit (539,413) (590,826)
------------- -------------
Total Infinera Corporation stockholders'
equity 762,151 481,907
Noncontrolling interest 14,910 -
------------- -------------
Total stockholder's equity 777,061 481,907
------------- -------------
Total liabilities and stockholders' equity $ 1,226,294 $ 818,016
============= =============
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Infinera Corporation
Condensed Consolidated Statements of Cash Flows
(In thousands)
(Unaudited)
Twelve Months Ended
----------------------------
December 26, December 27,
2015 2014
------------- -------------
Cash Flows from Operating Activities:
Net income $ 50,950 $ 13,659
Adjustments to reconcile net income to net
cash
provided by operating activities:
Depreciation and amortization 35,777 25,917
Amortization of debt discount and issuance
costs 9,281 8,395
Provision for (recovery of) doubtful
accounts 592 (2)
Amortization of premium on investments 2,917 3,772
Realized gain from forward contract (1,053) -
Stock-based compensation expense 32,580 28,394
Other loss (gain) 19 (7)
Changes in assets and liabilities:
Accounts receivable (15,971) (53,951)
Inventory (17,116) (25,486)
Prepaid expenses and other assets (3,248) (8,324)
Accounts payable 19,223 18,810
Accrued liabilities and other expenses (2,369) 11,866
Deferred revenue 10,777 8,788
Accrued warranty 10,817 4,132
------------- -------------
Net cash provided by operating
activities 133,176 35,963
Cash Flows from Investing Activities:
Purchase of available-for-sale investments (186,737) (302,398)
Acquisition of business, net of cash
acquired (144,445) -
Realized gain from forward contract for
business acquisition 1,053 -
Purchase of cost-method investment - (5,500)
Proceeds from sales of available-for-sale
investments 67,303 28,481
Proceeds from maturities and calls of
investments 213,234 208,051
Purchase of property and equipment (42,018) (23,122)
Change in restricted cash 135 (1,571)
------------- -------------
Net cash used in investing activities (91,475) (96,059)
Cash Flows from Financing Activities:
Proceeds from issuance of common stock 25,351 24,707
Minimum tax withholding paid on behalf of
employees for net share settlement (5,227) (1,846)
Excess tax benefit from stock option
transactions 859 -
------------- -------------
Net cash provided by financing
activities 20,983 22,861
Effect of exchange rate changes on cash (78) (600)
Net change in cash and cash equivalents 62,606 (37,835)
Cash and cash equivalents at beginning of
period 86,495 124,330
------------- -------------
Cash and cash equivalents at end of period $ 149,101 $ 86,495
============= =============
Supplemental disclosures of cash flow
information:
Cash paid for income taxes, net of refunds $ 4,570 $ 1,697
Cash paid for interest $ 2,647 $ 2,625
Supplemental schedule of non-cash investing
and financing activities:
Transfer of inventory to fixed assets $ 9,314 $ 2,569
Common stock issued in connection with
acquisition $ 169,507 $ -
Infinera Corporation
Supplemental Financial Information
(Unaudited)
----------------------------------------------------------------------------
Q1'14 Q2'14 Q3'14 Q4'14
----------------------------------------------------------------------------
Revenue ($ Mil) $ 142.8 $ 165.4 $ 173.6 $ 186.3
GAAP Gross Margin % 40.9% 42.5% 43.4% 45.3%
----------------------------------------------------------------------------
Non-GAAP Gross Margin % (1) 41.8% 43.3% 44.2% 46.1%
Revenue Composition:
Domestic % 78% 82% 70% 58%
International % 22% 18% 30% 42%
Customers >10% of Revenue 2 2 1 1
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Cash Related Information:
Cash from (Used in) Operations ($ Mil) $ (15.4) 10.3 $ 22.3 $ 18.7
Capital Expenditures ($ Mil) $ 5.6 $ 4.4 $ 4.4 $ 8.8
Depreciation & Amortization ($ Mil) $ 6.3 $ 6.5 $ 6.5 $ 6.6
DSO's 68 66 71 76
----------------------------------------------------------------------------
Inventory Metrics:
Raw Materials ($ Mil) $ 13.2 $ 11.2 $ 11.6 $ 15.2
Work in Process ($ Mil) $ 47.8 $ 40.6 $ 44.4 $ 50.0
Finished Goods ($ Mil) $ 65.5 $ 79.1 $ 74.8 $ 81.3
----------------------------------------------------------------------------
Total Inventory ($ Mil) $ 126.5 $ 130.9 $ 130.8 $ 146.5
----------------------------------------------------------------------------
Inventory Turns (2) 2.6 2.9 3.0 2.7
Worldwide Headcount 1,346 1,396 1,456 1,495
----------------------------------------------------------------------------
--------------------------------------------------------------------------
Q1'15 Q2'15 Q3'15 Q4'15
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Revenue ($ Mil) $ 186.9 $ 207.3 $ 232.5 $ 260.0
GAAP Gross Margin % 47.2% 46.7% 44.2% 44.5%
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Non-GAAP Gross Margin % (1) 47.8% 47.4% 47.5% 48.3%
Revenue Composition:
Domestic % 68% 75% 68% 62%
International % 32% 25% 32% 38%
Customers >10% of Revenue 2 3 2 2
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Cash Related Information:
Cash from (Used in) Operations ($ Mil)$ 19.8 $ 55.0 $ 32.5 $ 25.8
Capital Expenditures ($ Mil) $ 7.4 $ 8.7 $ 10.6 $ 15.3
Depreciation & Amortization ($ Mil) $ 6.6 $ 6.3 $ 9.2 $ 13.7
DSO's 64 48 55 65
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Inventory Metrics:
Raw Materials ($ Mil) $ 22.4 $ 30.2 $ 24.2 $ 27.9
Work in Process ($ Mil) $ 45.9 $ 43.9 $ 48.5 $ 52.6
Finished Goods ($ Mil) $ 88.9 $ 83.1 $ 97.2 $ 94.2
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Total Inventory ($ Mil) $ 157.2 $ 157.2 $ 169.9 $ 174.7
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Inventory Turns (2) 2.5 2.8 2.9 3.1
Worldwide Headcount 1,530 1,598 1,978 2,056
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(1) Non-GAAP adjustments include non-cash stock-based compensation expense, certain purchase accounting adjustments and amortization of acquired intangible assets. For a description of this non-GAAP financial measure, please see the section titled, "GAAP to Non-GAAP Reconciliations" of the press release dated February 11, 2016 for a reconciliation to the most directly comparable GAAP financial measures.
(2) Infinera calculates non-GAAP inventory turns as annualized non-GAAP cost of revenue before adjustments for non-cash stock-based compensation expense and certain purchase accounting adjustments, divided by the average inventory for the quarter.
Contacts:
Media: Anna Vue Tel. +1 (916) 595-8157 [email protected]: Jeff Hustis Tel. +1 (408) 213-7150 [email protected]
Source: Infinera
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