Immersion Corporation Reports Record Revenue in Third Quarter 2015; Raises Financial Outlook
Total revenues for the third quarter of 2015 were
Non-GAAP net income for the third quarter of 2015 was
As of
Management Commentary
"We achieved strong results in the third quarter as we generated record
September quarter revenues, enabling us to raise our revenue guidance
for the year," said
"Based on our year-to-date performance and current outlook, we are
increasing our 2015 revenue guidance to between
Business Highlights
Recent developments reflect the continued expansion of Immersion's base of customers and partners, new innovations in consumer form factors and content leveraging haptics, and further progress in the Content and Media area, including:
- New customer engagements, including a signed deal with Acer resulting in the launch of the industry's first dual-haptic (two actuator) tablet design. The new Acer Predator 8 Tablet and Gameloft's "Asphalt 8" leverage Immersion's TouchSense® Technology to deliver an immersive mobile gaming experience.
- Recent design wins and launches, including the Fujitsu Arrow NX F-04G and Gionee Elife E8 mobile smartphones.
- The establishment of new Content and Media relationships, and the launch of haptically-enhanced games, movie trailers and ads, including a new animated ad campaign for Stoli Vodka on Opera Mediaworks' mobile ad platform capable of reaching more than one million users per day through 250 separate mobile apps.
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 positioning Immersion to
capitalize on exciting market opportunities and our expectation that
revenues for 2015 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; the continued popularity of mobile games 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; 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 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 2014 which is on file with the
Immersion, the Immersion logo, TouchSense and TouchSense Engage 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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| 2015 | 2014 | ||||||
| (Unaudited) | (1) | ||||||
| ASSETS | |||||||
| Cash and cash equivalents | $ | 33,167 | $ | 14,380 | |||
| Short-term investments | 33,990 | 42,981 | |||||
| Accounts and other receivables, net | 1,503 | 3,021 | |||||
| Deferred income taxes | 2,921 | 9,377 | |||||
| Prepaid expenses and other current assets | 3,022 | 845 | |||||
| Total current assets | 74,603 | 70,604 | |||||
| Property and equipment, net | 4,778 | 1,207 | |||||
| Deferred income tax assets | 21,458 | 25,419 | |||||
| Prepaid income taxes | 7,495 | 0 | |||||
| Intangibles and other assets, net | 269 | 291 | |||||
| TOTAL ASSETS | $ | 108,603 | $ | 97,521 | |||
| LIABILITIES | |||||||
| Accounts payable | $ | 1,539 | $ | 669 | |||
| Accrued compensation | 3,631 | 1,906 | |||||
| Other current liabilities | 1,639 | 2,225 | |||||
| Deferred revenue | 12,664 | 7,779 | |||||
| Total current liabilities | 19,473 | 12,579 | |||||
| Long-term deferred revenue | 3,983 | 7,827 | |||||
| Other long-term liabilities | 752 | 512 | |||||
| TOTAL LIABILITIES | 24,208 | 20,918 | |||||
| STOCKHOLDERS' EQUITY | 84,395 | 76,603 | |||||
| TOTAL LIABILITIES & | |||||||
| STOCKHOLDERS' EQUITY | $ | 108,603 | $ | 97,521 | |||
| (1) Derived from Immersion's annual audited consolidated financial statements. | |||||||
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| Condensed Consolidated Statements of Income | ||||||||||||||||
| (In thousands, except per share amounts) | ||||||||||||||||
| (Unaudited) | ||||||||||||||||
| Three Months | Nine Months | |||||||||||||||
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Ended |
Ended |
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| 2015 | 2014 | 2015 | 2014 | |||||||||||||
| Revenues: | ||||||||||||||||
| Royalty and license | $ | 13,944 | $ | 11,714 | $ | 45,895 | $ | 38,473 | ||||||||
| Development, services, and other | 369 | 337 | 928 | 845 | ||||||||||||
| Total revenues | 14,313 | 12,051 | 46,823 | 39,318 | ||||||||||||
| Costs and expenses: | ||||||||||||||||
| Cost of revenues | 117 | 104 | 347 | 325 | ||||||||||||
| Sales and marketing | 3,198 | 2,238 | 11,078 | 7,638 | ||||||||||||
| Research and development | 3,471 | 2,718 | 10,697 | 8,782 | ||||||||||||
| General and administrative | 6,241 | 5,274 | 21,253 | 17,745 | ||||||||||||
| Amortization of intangibles | 3 | 15 | 18 | 55 | ||||||||||||
| Total costs and expenses | 13,030 | 10,349 | 43,393 | 34,545 | ||||||||||||
| Operating Income | 1,283 | 1,702 | 3,430 | 4,773 | ||||||||||||
| Interest and other income (expense) | (84 | ) | (30 | ) | (63 | ) | 107 | |||||||||
| Income before provision for income taxes | 1,199 | 1,672 | 3,367 | 4,880 | ||||||||||||
| Provision for income taxes | (1,015 | ) | (599 | ) | (1,647 | ) | (1,774 | ) | ||||||||
| Net Income | $ | 184 | $ | 1,073 | $ | 1,720 | $ | 3,106 | ||||||||
| Basic net income per share | $ | 0.01 | $ | 0.04 | $ | 0.06 | $ | 0.11 | ||||||||
| Shares used in calculating basic net income per share | 28,190 | 28,505 | 28,027 | 28,420 | ||||||||||||
| Diluted net income per share | $ | 0.01 | $ | 0.04 | $ | 0.06 | $ | 0.11 | ||||||||
| Shares used in calculating diluted net income per share | 29,134 | 29,351 | 28,893 | 29,355 | ||||||||||||
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| Reconciliation of GAAP Net Income to Non-GAAP Net Income | ||||||||||||||||
| (In thousands, except per share amounts) | ||||||||||||||||
| (Unaudited) | ||||||||||||||||
| Three Months | Nine Months | |||||||||||||||
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Ended |
Ended |
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| 2015 | 2014 | 2015 | 2014 | |||||||||||||
| GAAP Net Income | $ | 184 | $ | 1,073 | $ | 1,720 |
|
$ | 3,106 | |||||||
| Add: Stock-based compensation | 1,276 | 1,131 | 4,245 | 4,058 | ||||||||||||
| Add: GAAP Provision for income taxes | 1,015 | 599 | 1,647 | 1,774 | ||||||||||||
| Less: Non-GAAP provision for income taxes (at 19%) | (228 | ) | (318 | ) | (640 | ) | (927 | ) | ||||||||
| Non-GAAP Net Income | $ | 2,247 | $ | 2,485 | $ | 6,972 | $ | 8,011 | ||||||||
| Non-GAAP Earnings Per Share | $ | 0.08 | $ | 0.08 | $ | 0.24 | $ | 0.27 | ||||||||
| Shares used in calculating Non-GAAP Earnings per Share | 29,134 | 29,351 | 28,893 | 29,355 | ||||||||||||
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