Immersion Corporation Reports First Quarter 2016 Results; Files Second Complaint Against Apple Inc., AT&T Inc., and AT&T Mobility LLC with U.S. International Trade Commission and in U.S. Federal District Court
Results for the quarter ended
Total revenues for the first quarter of 2016 were
Net loss for the first quarter of 2016 was
Non-GAAP net loss for the first quarter of 2016 was
As of
Litigation Update
Samsung: In the first quarter of 2016, Immersion initiated
arbitration against Samsung with the
Apple: In the first quarter of 2016, Immersion filed a complaint
against Apple Inc., AT&T Inc. and
Immersion also announced today that it has filed a second complaint with
the ITC against Apple, AT&T, and AT&T Mobility LLC and a corresponding
patent infringement complaint against Apple, AT&T and AT&T Mobility in
the U.S. District Court for the District of
The complaints assert infringement by the Apple iPhone 6s and Apple iPhone 6s Plus of the following three Immersion patents:
The complaints also assert infringement by the Apple MacBook and Apple MacBook Pro with Retina display of the following Immersion patent:
Sony: In the first quarter of 2016, Immersion received a
favorable ruling in an arbitration against
Management Commentary
"I am pleased with the results we achieved in the March quarter despite
a change in customer mix as we work to protect and preserve our
intellectual property with top-tier mobile OEMs," said
"Based on our March quarter performance and current outlook, we remain
on track towards our 2016 revenue outlook of
Recent Business Highlights
- Immersion renewed its license agreement with MEIZU Technology Co. Ltd., a leading manufacturer of mobile devices in China, for the use of Immersion TouchSense® technology in MEIZU branded smartphones. MEIZU's recently launched PRO 6 series feature a number of different use cases with Immersion's haptic technology, such as the back button, long-click home button, incoming calls, dial pad and keyboard.
-
Immersion and CRI Middleware Co., Ltd., a leading provider of audio and video solutions for the gaming industry in Japan, signed an agreement to enable game developers using CRI Middleware platform's CRIWARE to incorporate Immersion's TouchSense® technology in their Android mobile games. - Immersion's TouchSense® haptic technology was featured in Kyocera's New DuraForce XD Smartphone. This full-feature smartphone uses Immersion's TouchSense Haptic Enabling Kit to enhance user functionality with touch feedback. Immersion's haptic technology precisely controls the actuator(s) in the device to create nuanced tactile effects that simulate the connected experience of the physical world.
-
Immersion delivered eight advertising campaigns with haptics in the
first quarter of 2016 through Opera Mediaworks' ad network and TF1,
the largest broadcast network channel in
France , spanning multiple industries including consumer brands, automotive and entertainment. -
Immersion's TouchSense® Technology was featured in the in-app mobile
ad for the Lexus GS
F. Lexus , in partnership with its advertising agency Team One, has launched a haptic ad campaign for the first-ever Lexus GS F that currently runs on Opera Mediaworks-enabled Android mobile apps in the United States. Team One, Immersion and Opera Mediaworks worked together to enhance the Lexus mobile ad with sophisticated tactile effects to capture how it feels to drive the most powerful Lexus sedan.
Conference Call Information
Immersion will host a conference call with company management on
About Immersion
Founded in 1993,
Use of Non-GAAP Financial Measures
Immersion reports all financial information required in accordance with generally accepted accounting principles (GAAP), but it believes that evaluating its ongoing operating results may be difficult to understand if limited to reviewing only GAAP financial measures. Immersion discloses this non-GAAP information, such as Non-GAAP net income and Non-GAAP net income per diluted share, because it is useful in understanding the company's performance as it more closely reflects its expected long-term effective tax rates and excludes certain non-cash expenses and other special charges that many investors feel may obscure the company's true operating performance. Likewise, management uses these non-GAAP financial measures to manage and assess the profitability of its business. Investors are encouraged to review the related GAAP financial measures.
Forward-looking Statements
This press release contains "forward-looking statements" that involve
risks and uncertainties as well as assumptions that, if they never
materialize or prove incorrect, could cause the results of
All statements, other than the statements of historical fact, are
statements that may be deemed forward-looking statements, including, but
not limited to, the statements regarding the momentum of Immersion's
business, the benefits of the outcome of the arbitration against Sony,
the relevance of our intellectual property portfolio and our expectation
that revenues for 2016 will be in the range of
Immersion's actual results might differ materially from those stated or implied by such forward-looking statements due to risks and uncertainties associated with Immersion's business, which include, but are not limited to, potential and actual claims and proceedings, including litigation involving Immersion's intellectual property; delay in or failure to achieve commercial demand for Immersion's or its licensees' products; a delay in or failure to achieve the acceptance of force feedback as a critical user experience; unexpected difficulties in monetizing the patent portfolio; the commercial success of applications or devices into which Immersion's technology is licensed; ability to track and retain partners, the continued popularity of mobile games, mobile advertisements and wearables; potentially lengthy sales cycles and design processes; unanticipated difficulties and challenges encountered in development efforts; unexpected costs; the fact that certain target markets are still relatively nascent; risks associated with doing business internationally; litigation costs in any current or future litigation; failure to retain key personnel; ability to retain personnel; competition; the inherently uncertain nature of litigation which makes future outcomes and timing difficult to predict; the impact of global economic conditions and foreign currency exchange rates and other factors. Many of these risks and uncertainties are beyond the control of Immersion.
For a more detailed discussion of these factors, and other factors that
could cause actual results to vary materially, interested parties should
review the risk factors listed in Immersion's Annual Report on Form 10-K
for 2015 which is on file with the
Immersion, the Immersion logo and TouchSense are trademarks or
registered trademarks of
The use of the word "partner" or "partnership" in this press release does not mean a legal partner or legal partnership.
(IMMR - C)
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Condensed Consolidated Balance Sheets | |||||||
(In thousands) | |||||||
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||||||
2016 | 2015 | ||||||
(Unaudited) | (1) | ||||||
ASSETS | |||||||
Cash and cash equivalents | $ | 20,879 | $ | 25,013 | |||
Short-term investments | 39,927 | 39,918 | |||||
Accounts receivable, net | 4,774 | 1,213 | |||||
Prepaid expenses and other current assets | 2,679 | 2,790 | |||||
Total current assets | 68,259 | 68,934 | |||||
Property and equipment, net | 4,412 | 4,589 | |||||
Deferred income tax assets | 26,262 | 24,633 | |||||
Prepaid income taxes | 6,270 | 6,995 | |||||
Intangibles and other assets, net | 245 | 264 | |||||
TOTAL ASSETS | $ | 105,448 | $ | 105,415 | |||
LIABILITIES | |||||||
Accounts payable | $ | 2,978 | $ | 650 | |||
Accrued compensation | 2,769 | 4,840 | |||||
Other current liabilities | 2,782 | 2,999 | |||||
Deferred revenue | 6,943 | 6,696 | |||||
Total current liabilities | 15,472 | 15,185 | |||||
Long-term deferred revenue | 1,121 | 2,516 | |||||
Other long-term liabilities | 837 | 1,099 | |||||
TOTAL LIABILITIES | 17,430 | 18,800 | |||||
STOCKHOLDERS' EQUITY | 88,018 | 86,615 | |||||
TOTAL LIABILITIES & | |||||||
STOCKHOLDERS' EQUITY | $ | 105,448 | $ | 105,415 | |||
(1) Derived from Immersion's annual audited consolidated financial statements. |
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Condensed Consolidated Statements of Operations | ||||||||
(In thousands, except per share amounts) | ||||||||
(Unaudited) | ||||||||
Three Months | ||||||||
Ended |
||||||||
2016 | 2015 | |||||||
Revenues: | ||||||||
Royalty and license | $ | 13,448 | $ | 16,012 | ||||
Development, services, and other | 175 | 275 | ||||||
Total revenues | 13,623 | 16,287 | ||||||
Costs and expenses: | ||||||||
Cost of revenues | 23 | 115 | ||||||
Sales and marketing | 3,803 | 4,210 | ||||||
Research and development | 4,312 | 3,727 | ||||||
General and administrative | 10,090 | 8,293 | ||||||
Amortization of intangibles | 3 | 12 | ||||||
Total costs and expenses | 18,231 | 16,357 | ||||||
Operating loss | (4,608 | ) | (70 | ) | ||||
Interest and other income (expense) | 212 | (25 | ) | |||||
Loss before benefit for income taxes | (4,396 | ) | (95 | ) | ||||
Benefit for income taxes | 1,701 | 36 | ||||||
Net loss | $ | (2,695 | ) | $ | (59 | ) | ||
Basic and diluted net loss per share | $ | (0.09 | ) | $ | 0.00 | |||
Shares used in calculating basic and diluted net loss per share | 28,493 | 27,818 |
|
||||||||
Reconciliation of GAAP Net Loss to Non-GAAP Net Income (loss) | ||||||||
(In thousands, except per share amounts) | ||||||||
(Unaudited) | ||||||||
Three Months | ||||||||
Ended |
||||||||
2016 | 2015 | |||||||
GAAP net loss | $ | (2,695 | ) | $ | (59 | ) | ||
Add: Stock-based compensation | 2,334 | 1,740 | ||||||
Less: Benefit for income taxes |
(1,701 | ) | (36 | ) | ||||
Add: Non-GAAP benefit for income taxes (at 19%) | 835 | 18 | ||||||
Non-GAAP net income (loss) | $ | (1,227 | ) | $ | 1,663 | |||
Non-GAAP earnings (loss) per share | $ | (0.04 | ) | $ | 0.06 | |||
Shares used in calculating Non-GAAP earnings (loss) per share | 28,493 | 28,587 | ||||||
Note: Shares used in calculating Non-GAAP earnings per share have
been adjusted for the three months ended |
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