7/18...PXLW..Achieves Profitability in Second Quarter
Record Revenues Fueled by Strong Sales of ImageProcessor ICs
TUALATIN, Ore.--(BUSINESS WIRE)--July 18, 2000--Pixelworks, Inc. (Nasdaq:PXLW - news)
Selected Quarter Highlights
Second quarter net income totals $0.6 million; marks first profitable quarter in company history in inaugural quarter as public company
Record revenues grow 72 percent sequentially, 556 percent year-over-year
Company completes successful IPO, raising $60.5 million
Pixelworks, Inc. (Nasdaq:PXLW - news), a leading designer and developer of system-on-a-chip semiconductors and software that enable the visual display of broadband content, today announced record financial results for the first reported quarter since completion of its initial public offering on May 19, 2000.
Revenue for the second quarter, which ended June 30, 2000, was $12.1 million, a 72 percent increase over revenue of $7.1 million in the first quarter and a 556 percent increase over the $1.8 million recorded in the comparable 1999 period.
Net income for the second quarter was $0.6 million, or $0.02 per diluted share, based on 35.8 million weighted-average diluted shares outstanding. This marked the first quarter of profitability since the inception of the company in 1997, coming in the company's inaugural quarter as a public company. This compared to a net loss of $3.0 million or $0.49 per basic and diluted share based on 6.2 million weighted-average basic and diluted shares outstanding for the comparable period in the prior year, and a net loss of $17.3 million or $2.19 per basic and diluted share based on 7.9 million weighted-average basic and diluted shares outstanding in the first quarter of 2000.
Net income for the second quarter, excluding non-cash charges related to amortization of deferred stock compensation expense, was $1.2 million, or $0.03 per diluted share. This compared to a net loss for the comparable prior year period, excluding non-cash charges for amortization of deferred stock compensation and accretion of preferred stock redemption preference, of $1.4 million, or $0.22 per basic and diluted share. Net income in the second quarter increased $1.8 million over the $0.6 million net loss, excluding non-cash charges of $16.6 million, in the first quarter of 2000.
``We are extremely pleased with our progress in the second quarter,'' said Allen Alley, President, CEO and Chairman of Pixelworks. ``After successfully completing our IPO in a challenging market environment, we demonstrated that Pixelworks is solidly on strategic course by generating healthy revenue growth and achieving our first-ever profitable quarter.''
``Our growth is being driven by higher than expected sales of Pixelworks ImageProcessor ICs used in innovative display products developed by our customers including Samsung, Sony, Compaq, ViewSonic and other industry leaders. These products have been received enthusiastically by consumers and industry experts proving end-users want the features and performance that Pixelworks ImageProcessor ICs provide,'' Alley concluded.
About Pixelworks, Inc.
Pixelworks, headquartered in Tualatin, Oregon, designs, develops and markets system-on-a-chip semiconductors and software that enable the visual display of broadband content through a wide variety of electronic devices. Pixelworks' solutions process and optimize video, computer graphics and Web information for display on a wide variety of devices used in business and consumer markets. For more information, please visit the company's Web site at www.pixelworks.com.
Forward-Looking Statements
This news release contains forward-looking statements that are based on expectations and assumptions that involve a number of uncertainties and risks that could cause actual results to differ materially from those discussed in the forward-looking statements, including but not limited to risks associated with rapidly evolving markets, the company's products and uncertainties regarding the development of those markets; new product development and the ongoing introduction of new and enhanced products by the company and its competitors; the company's reliance on independent foundries and contractors; intensive competition in the markets in which the company competes; dependence on sales to a limited number of large customers; dependence on key personnel; and the reliance on international sales. Additional information regarding factors that could cause actual results to differ from those anticipated is included in filings made by the company from time to time with the Securities and Exchange Commission. Those include, the prospectus included in its Form S-1 Registration Statement filed on May 19, 2000, and will over time include other filings.
PIXELWORKS, INC.
CONDENSED STATEMENT OF OPERATIONS
(in thousands, except per share data)
Three Months Ended Six Months Ended
June 30, June 30,
2000 1999 2000 1999
----------- ----------- ----------- -----------
Revenue $ 12,123 $ 1,849 $ 19,187 $ 2,465
Cost of revenue 7,411 1,318 11,906 1,481
----------- ----------- ----------- -----------
Gross profit 4,712 531 7,281 984
Operating expenses:
Research and
development 2,344 1,052 4,034 1,875
Selling, general and
administrative expense 2,122 915 3,906 1,519
Patent settlement
expense - - 4,078 -
Amortization of
deferred stock
compensation 582 29 1,026 33
----------- ----------- ----------- -----------
Total operating
expenses 5,048 1,996 13,044 3,427
----------- ----------- ----------- -----------
Income (loss) from
operations (336) (1,465) (5,763) (2,443)
----------- ----------- ----------- -----------
Interest income 926 74 1,221 110
Interest expense - - (38)
Other income - - 10 -
----------- ----------- ----------- -----------
Interest and other
income, net 926 74 1,193 110
----------- ----------- ----------- -----------
Income (loss)
before income
taxes 590 (1,391) (4,570) (2,333)
----------- ----------- ----------- -----------
Income tax provision
(benefit) - - - 3
----------- ----------- ----------- -----------
Net income (loss) 590 (1,391) (4,570) (2,336)
Preferred stock
beneficial conversion
feature - - 9,995 -
Accretion of preferred
stock redemption
preference - 1,625 2,100 1,723
----------- ----------- ----------- -----------
Net income (loss)
attributable to
common
shareholders $ 590 $ (3,016) $ (16,665) $ (4,059)
=========== =========== =========== ===========
Basic net income
(loss) per share $ 0.03 $ (0.49) $ (1.14) $ (0.81)
=========== =========== =========== ===========
Diluted net income
(loss) per share $ 0.02 $ (0.49) $ (1.14) $ (0.81)
=========== =========== =========== ===========
Weighted average
shares-basic 21,259,225 6,150,087 14,573,270 4,995,527
=========== =========== =========== ===========
Weighted average
shares-diluted 35,768,527 6,150,087 14,573,270 4,995,527
=========== =========== =========== ===========
Net income (loss)
excluding amortization
of deferred stock
compensation, patent
settlement expense,
accretion of preferred
stock redemption
preference and
preferred stock
beneficial conversion
feature $ 1,172 $ (1,362) $ 534 $ (2,303)
=========== =========== =========== ===========
Basic net income
(loss) per share $ 0.06 $ (0.22) $ 0.04 $ (0.46)
======== ========== =========== ===========
Diluted net income
(loss) per share $ 0.03 $ (0.22) $ 0.02 $ (0.46)
=========== =========== =========== ===========
Weighted average
shares-basic 21,259,225 6,150,087 14,573,270 4,995,527
=========== =========== =========== ===========
Weighted average
shares-diluted 35,768,527 6,150,087 29,771,869 4,995,527
=========== =========== =========== ===========
PIXELWORKS, INC.
CONDENSED BALANCE SHEET
(in thousands, except share data)
June 30, December 31,
ASSETS 2000 1999
-------- --------
CURRENT ASSETS
Cash and cash equivalents $ 92,035 $ 12,199
Short-term investments 5,906 -
Accounts receivable, net 3,115 2,537
Inventories 1,959 1,404
Prepaid expenses and other current assets 515 21
---------- ---------
Total current assets 103,530 16,161
Property and equipment, net 2,614 1,730
Other assets, net 1,697 503
---------- ---------
Total assets $ 107,841 $ 18,394
========== =========
LIABILITIES, PREFERRED STOCK AND SHAREHOLDERS' EQUITY (DEFICIT)
CURRENT LIABILITIES
Accounts payable $ 2,863 $ 712
Accrued liabilities 4,251 1,518
Line of credit - 669
Current portion of long-term obligations - 492
--------- --------
Total current liabilities 7,114 3,391
Long-term obligations - 591
Other liabilities 6 6
--------- --------
Total liabilities 7,120 3,988
Redeemable convertible preferred stock - 23,701
Shareholders' equity (deficit) 100,721 (9,295)
--------- --------
Total liabilities, preferred stock and
shareholders' equity (deficit) $ 107,841 $ 18,394
========= ========
Pixelworks is a trademark of Pixelworks, Inc. All other trademarks and registration marks are the property of their respective corporations
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Contact:
Pixelworks, Inc. (Investor Inquiries)
Jodie Brady, 503/612-6700 ext. 527
jodieb@pixelworks.com
or
Pixelworks, Inc. (Media Inquiries)
Chris Bright, 503/ 612-6700 ext. 594
cbright@pixelworks.com
or
www.pixelworks.com |
