April 30, 2009
SAN JOSE, Calif., April 30, 2009 — IDT® (Integrated Device Technology, Inc.; NASDAQ: IDTI), a leading provider of essential mixed signal semiconductor solutions that enrich the digital media experience, today announced results for the fiscal fourth quarter and year ended March 29, 2009.
“Our fiscal fourth quarter results were in line with our updated projections provided on March 31, 2009,” said Dr. Ted Tewksbury, president and CEO of IDT. “Despite a sequential revenue decline resulting from weakened demand, excess channel inventory and normal seasonality, we were pleased to see our book-to-bill ratio for the March quarter above one as customer order patterns began to stabilize. In addition, we implemented a number of cost control measures which lower our non-GAAP EPS and free cash flow breakeven points, and reallocated R&D dollars to focus on select opportunities to expand our addressable market.
“We faced a challenging macroeconomic environment during our fiscal 2009, but we have embraced this disruptive opportunity to reinvent the company, hire some of the industry’s finest talent and develop innovative new growth platforms that will expand our market share and propel revenue growth when demand returns. I am confident that if we continue to innovate and execute at our current pace, IDT will emerge from this downturn as an even more vital extension of our customers' development teams delivering increased value to our shareholders,” continued Tewksbury.
· IDT entered into a definitive acquisition agreement pursuant to which IDT will acquire Tundra Semiconductor for CDN $6.25 per share, for an aggregate purchase price of approximately CDN $120.8 million
· IDT introduced its new Power Smart technology and significantly expanded its power management expertise through the addition of its new analog design team
· H3C Technologies selected IDT PCI Express® switching solutions for its SecPath high-end security systems
· IDT introduced a new member to its family of Serial RapidIO® Central Packet Switches which provides increased bandwidth, configurability, and flexibility for next-generation cellular base stations
The following highlights the Company’s financial performance on both a GAAP and non-GAAP basis. The GAAP results include certain costs, charges, gains and losses in accordance with GAAP which are excluded from non-GAAP results based on management’s determination that they are not directly reflective of on-going operations. Non-GAAP results are not in accordance with GAAP and may not be comparable to non-GAAP information provided by other companies. Non-GAAP information should be considered a supplement to, and not a substitute for, financial statements prepared in accordance with GAAP. A complete reconciliation of GAAP to non-GAAP results is attached to this press release.
· Revenue for the fiscal fourth quarter of 2009 was $107.4 million, compared with $177.1 million reported in the same period one year ago. Revenue for fiscal year 2009 was $663.2 million, compared with $781.5 million in fiscal year 2008.
· GAAP net loss for the fiscal fourth quarter of 2009 was $719.2 million or a loss of $4.37 per diluted share, versus GAAP net income of $17.1 million or approximately $0.10 per diluted share in the same period one year ago. As a result of the current economic environment and decline in the market value of the Company, IDT has conducted a goodwill and intangible asset impairment analysis which resulted in a non-cash charge of $686.6 million. Fiscal fourth quarter 2009 GAAP results also include $18.3 million in amortization of intangibles, $6.6 million of stock-based compensation, and $5.4 million of severance-related expense. GAAP net loss for fiscal year 2009 was $1.0 billion, compared with GAAP net income of $34.2 million in fiscal 2008.
· Non-GAAP net loss for the fiscal fourth quarter of 2009 was $2.8 million or $0.02 per diluted share, compared with non-GAAP net income of $42.7 million or $0.24 per diluted share reported in the same period one year ago.Non-GAAP net income for fiscal year 2009 was $109.8 million or $0.65 per diluted share, compared with $181.8 million or $0.96 per diluted share in fiscal year 2008.
· GAAP gross profit for the fiscal fourth quarter of 2009 was $34.7 million, compared with GAAP gross profit of $77.9 million in the same period one year ago. Non-GAAP gross profit for the fiscal fourth quarter of 2009 was $49.1 million, compared with non-GAAP gross profit of $94.4 million reported in the same period one year ago. GAAP gross profit for fiscal 2009 was $276.0 million, compared with $339.3 million for fiscal 2008. Non-GAAP gross profit was $337.0 million for fiscal 2009, compared with $407.7 million for fiscal 2008.
· GAAP R&D expense for the fiscal fourth quarter of 2009 was $38.8 million, compared with GAAP R&D expense of $38.4 million in the same period one year ago. Non-GAAP R&D expense for the fiscal fourth quarter of 2009 was $31.9 million, compared with non-GAAP R&D expense of $33.0 million in the same period one year ago. GAAP R&D expense for fiscal 2009 was $161.2 million, compared with $165.6 million for fiscal 2008. Non-GAAP R&D expense for fiscal 2009 was $137.8 million, compared with $141.6 million in fiscal 2008.
· GAAP SG&A expense for the fiscal fourth quarter of 2009 was $29.8 million, compared with GAAP SG&A expense of $34.1 million in the same period one year ago. Non-GAAP SG&A expense for the fiscal fourth quarter of 2009 was $20.7 million, compared with non-GAAP SG&A expense of $22.3 million in the same period one year ago. GAAP SG&A expense for fiscal 2009 was $125.8 million, compared with $161.7 million for fiscal 2008. Non-GAAP SG&A expense for fiscal 2009 was $90.9 million, compared with $97.6 million for fiscal 2008.
Webcast and Conference Call Information
Investors can listen to a live or replay webcast of the Company’s quarterly financial conference call at http://www.IDT.com. The live webcast will begin at 1:30 p.m. Pacific time on April 30, 2009. The webcast replay will be available after 5:00 p.m. Pacific time on April 30, 2009.
Investors can also listen to the live call at 1:30 p.m. Pacific time on April 30, 2009 by calling (800) 230-1085 or (612) 288-0329. The conference call replay will be available after 5:00 p.m. Pacific time on April 30, 2009 through 11:59 p.m. Pacific time on May 7, 2009 at (800) 475-6701 or (320) 365-3844. The access code is 993533.
With the goal of continuously improving the digital media experience, IDT integrates its fundamental semiconductor heritage with essential innovation, developing and delivering low-power, mixed signal solutions that solve customer problems. Headquartered in San Jose, Calif., IDT has design, manufacturing and sales facilities throughout the world. IDT stock is traded on the NASDAQ Global Select Stock Market® under the symbol "IDTI". Additional information about IDT is accessible at www.IDT.com.
Forward Looking Statements
Investors are cautioned that forward-looking statements in this release, including but not limited to statements regarding demand for Company products, customer ordering patterns, channel inventory, anticipated trends in Company sales, expenses and profits, and macroeconomic conditions involve a number of risks and uncertainties that could cause actual results to differ materially from current expectations. Risks include, but are not limited to, global business and economic conditions, fluctuations in product demand, manufacturing capacity and costs, inventory management, competition, pricing, patent and other intellectual property rights of third parties, timely development and introduction of new products and manufacturing processes, dependence on one or more customers for a significant portion of sales, successful integration of acquired businesses and technology, availability of capital, cash flow and other risk factors detailed in the Company’s Securities and Exchange Commission filings. The Company urges investors to review in detail the risks and uncertainties in the Company’s Securities and Exchange Commission filings, including but not limited to the Annual Report on Form 10-K for the fiscal year ended March 30, 2008 and Quarterly Report on Form 10-Q for the period ended December 28, 2008. All forward-looking statements are made as of the date of this release and the Company disclaims any duty to update such statements.
The Company presents non-GAAP financial measures because the financial community uses non-GAAP results in its analysis and comparison of historical results and projections of the Company's future operating results. These non-GAAP results exclude impairment charges, acquisition-related charges, share-based compensation expense and certain other expenses and benefits. Management uses these non-GAAP measures to manage and assess the profitability of the business. These non-GAAP results are also consistent with another way management internally analyzes IDT’s results and may be useful. The Company has reconciled such non-GAAP results to the most directly comparable GAAP financial measures in the financial tables at the end of this press release.
Reference to these non-GAAP results should be considered in addition to results that are prepared under current accounting standards, but should not be considered a substitute for results that are presented in accordance with GAAP. It should also be noted that IDT's non-GAAP information may be different from the non-GAAP information provided by other companies.
IDT and the IDT logo are trademarks of Integrated Device Technology, Inc. All other brands, product names and marks are or may be trademarks or registered trademarks used to identify products or services of their respective owners.