Cavium Announces Financial Results for Q2 2016

CAVIUM, INC. Unaudited GAAP Condensed Consolidated Statements of Operations(in thousands, except per share amounts)

June 30, 2016

March 31, 2016

Net revenue

$

107,158

$

101,882

Cost of revenue

35,499

33,866

Gross profit

71,659

68,016

Operating expenses:

     Research and development

52,578

50,455

     Sales, general and administrative

25,882

20,925

        Total operating expenses

78,460

71,380

Loss from operations

(6,801)

(3,364)

Other income (expense), net:

    Interest expense

(185)

(208)

    Other, net

(151)

14

Total other expense, net

(336)

(194)

     Loss before income taxes

(7,137)

(3,558)

     Provision for income taxes

273

275

Net loss

$

(7,410)

$

(3,833)

Net loss per common share, basic and diluted

$

(0.13)

$

(0.07)

Shares used in computing basic and diluted net loss per common share

57,527

56,932

CAVIUM, INC.Unaudited Reconciliation of Non-GAAP Adjustments(in thousands)

Three Months Ended

June 30, 2016

March 31, 2016

Reconciliation of GAAP operating expenses to non-GAAP:

GAAP research and development expenses

$

52,578

$

50,455

Stock-based compensation and related payroll taxes

(9,017)

(8,773)

Amortization of acquisition related assets and other

(3,523)

(3,532)

Non-GAAP research and development expenses

$

40,038

$

38,150

GAAP sales, general and administrative expenses

$

25,882

$

20,925

Stock-based compensation and related payroll taxes

(5,263)

(5,984)

Acquisition related expenses

(6,339)

-

Non-GAAP sales, general and administrative expenses

$

14,280

$

14,941

Total Non-GAAP operating expenses

$

54,318

$

53,091

CAVIUM, INC.Unaudited Reconciliation of Non-GAAP Adjustments(in thousands, except per share data and percentages)

Three Months Ended

June 30, 2016

March 31, 2016

Reconciliation of GAAP gross profit and margin to non-GAAP:

Net revenue

$

107,158

$

101,882

GAAP gross profit

71,659

68,016

GAAP gross margin

66.9

%

66.8

%

Stock-based compensation and related payroll taxes

261

191

Amortization of acquisition related assets

157

157

Non-GAAP gross profit

$

72,077

$

68,364

Non-GAAP gross margin

67.3

%

67.1

%

Reconciliation of GAAP loss from operations to non-GAAP income from operations:

GAAP loss from operations

$

(6,801)

$

(3,364)

Stock-based compensation and related payroll taxes

14,541

14,948

Amortization of acquisition related assets and other

3,680

3,689

Acquisition related expenses

6,339

-

Non-GAAP income from operations

$

17,759

$

15,273

Non-GAAP income from operations as a percentage of revenue

16.6

%

15.0

%

Reconciliation of GAAP net loss to non-GAAP net income:

GAAP net loss

$

(7,410)

$

(3,833)

Non-GAAP adjustments:

Stock-based compensation and related payroll taxes

14,541

14,948

Amortization of acquisition related assets and other

3,680

3,689

Acquisition related expenses

6,339

-

Total of non-GAAP adjustments

24,560

18,637

Non-GAAP net income

$

17,150

$

14,804

GAAP net loss per share, diluted

$

(0.13)

$

(0.07)

Non-GAAP adjustments detailed above

0.42

0.32

Non-GAAP net income per share, diluted

$

0.29

$

0.25

GAAP weighted average shares, diluted

57,527

56,932

Non-GAAP share adjustment

2,471

3,233

Non-GAAP weighted average shares, diluted

59,998

60,165

CAVIUM, INC.Unaudited GAAP Condensed Consolidated Balance Sheets(in thousands)

As of

June 30, 2016

March 31, 2016

Assets

Current assets

Cash and cash equivalents

$

140,419

$

129,629

Accounts receivable, net

82,137

79,594

Inventories

52,702

48,092

Prepaid expenses and other current assets

10,109

8,233

Total current assets

285,367

265,548

Property and equipment, net

64,917

63,303

Intangible assets, net

36,698

37,907

Goodwill

71,478

71,478

Other assets

1,822

1,738

Total assets

$

460,282

$

439,974

Liabilities and Stockholders' Equity

Current liabilities

Accounts payable

$

30,024

$

25,668

Other accrued expenses and other current liabilities

16,447

8,326

Deferred revenue

7,856

6,425

Capital lease and technology license obligations

17,380

17,286

Total current liabilities

71,707

57,705

Capital lease and technology license obligations, net of current

4,182

6,932

Deferred tax liability

3,923

3,785

Other non-current liabilities

4,140

2,907

Total liabilities

83,952

71,329

Stockholders' equity

Common stock

58

57

Additional paid-in capital

576,927

561,833

Accumulated deficit

(200,655)

(193,245)

Total stockholders' equity

376,330

368,645

Total liabilities and stockholders' equity

$

460,282

$

439,974