ScanSoft Announces Third Quarter Results
Thursday November 13, 7:15 am ET
PEABODY, Mass.--(BUSINESS WIRE)--Nov. 13, 2003--ScanSoft, Inc. (Nasdaq: SSFT - News), the leading supplier of speech and imaging solutions, today announced financial results for the third quarter ended September 30, 2003.
ScanSoft reported third quarter 2003 revenue of $32.9 million, a 17 percent increase over third quarter 2002 revenue of $28.2 million. Net income before amortization of acquisition-related intangible assets and restructuring and other charges was $1.5 million, or $0.02 per diluted share, compared with $5.1 million, or $0.07 per diluted share, for the third quarter of 2002. After including amortization of acquisition-related intangible assets and restructuring and other charges, ScanSoft reported a third quarter 2003 net loss of $3.7 million, or $0.04 per share, compared with third quarter 2002 net income of $2.8 million, or $0.04 per diluted share.
For the first nine months of 2003, ScanSoft reported total revenue of $88.5 million, a 13 percent increase over revenue of $78.2 million in the first nine months of 2002. Net income before amortization of acquisition-related intangible assets and restructuring and other charges was $5.3 million, or $0.06 per diluted share, compared with $11.9 million, or $0.16 per diluted share, for the first nine months of 2002. After including amortization of acquisition-related intangible assets and restructuring and other charges, ScanSoft reported a net loss of $6.8 million, or $0.10 per share, in the first nine months of 2003 compared with net income of $1.9 million, or $0.03 per diluted share, for the first nine months of 2002.
Comments on the Third Quarter
"ScanSoft's solid results in the third quarter were driven by a strong performance in network speech, domestically and internationally, as we communicated our product roadmap, expanded our channels and deployed new applications," said Paul Ricci, chairman and CEO of ScanSoft. "During the quarter, we made good progress in focusing resources and attention on timely product launches, international expansion and support of our global partner channel."
Third Quarter Highlights:
* Operating Results: ScanSoft posted another quarter of operating profitability through synergies gained from the SpeechWorks acquisition and enterprise-wide expense control and productivity. ScanSoft ended the quarter with a cash balance of $48 million.
* SpeechWorks Acquisition: On August 11, 2003, ScanSoft completed the acquisition of SpeechWorks International, Inc. creating a global leader in speech markets. The organization and channel integration is substantially complete, with the company maintaining approximately 800 employees in 15 major offices worldwide and channel partners in an additional 60 countries. Product direction and technology integration plans have been finalized and being communicated to ScanSoft's global partner and customer network.
* Accelerating Adoption of Speech: Third quarter results were driven by strong performance in network speech as the company benefited from expanded channel relationships and growing deployments among its enterprise customers. The company recently showcased applications from customers such as Bank of America, Verizon, Dollar Rent-A-Car and Qantas Airways at Conversations, its annual customer and partner meeting.
* Global Leader in Speech Market: A recent Gartner Inc. report showed that ScanSoft and SpeechWorks together accounted for 38 percent of the speech recognition systems shipped worldwide in 2002.
* New PDF Solution: In the third quarter, ScanSoft began shipping PDF Converter, a new productivity applications offering that automatically converts PDF files into Microsoft Word documents. This product was officially launched in October in conjunction with the worldwide launch of Microsoft Office 2003.
* Microsoft Alliance: ScanSoft expanded its relationship with Microsoft through several initiatives including pre-launch activity for ScanSoft's new PDF Converter product; electronic forms for the Microsoft InfoPath system; and programs to enhance worker productivity in healthcare and education.
* Expanded International Presence: During the quarter, ScanSoft launched new, international versions of Dragon NaturallySpeaking v7, expanded its imaging R&D resources in Budapest and its sales efforts in Asia-Pacific, and introduced support for new languages in its speech recognition and text-to-speech (TTS) engines. International sales accounted for approximately 34 percent of the revenue in the third quarter.
"Through the SpeechWorks integration, the launch of new products and a market-oriented, company-wide reorganization, the third quarter had a profound, beneficial impact on the company, our partners and our customers," Ricci continued. "We are pleased with our early success as a new organization and are even more encouraged at the opportunity before us. With an intense focus on addressing customer needs and gaining additional market share across our Network Speech, Productivity Applications and Embedded Speech businesses, we are confident in ScanSoft's growth opportunities and the strength of our business model." |
