Acme Packet Reports Record Revenues and Net Income in Third Quarter of Fiscal Year 2006
Acme Packet, Inc. (NASDAQ: APKT), the leader in session border control solutions, today announced results for its third quarter ended September 30, 2006.
Results for Three Month Period Ended September 30, 2006
For the three month period ended September 30, 2006, total revenues increased 229% to $22.3 million from $6.8 million in the same period last year. For the three month period ended September 30, 2006, net income was $6.8 million. Basic and diluted net income per share for the three month period ended September 30, 2006 was $0.14 per share and $0.12 per share, respectively. The Company reported a net loss of $2.5 million, or $0.16 per share, in the same period last year. For the three month period ended September 30, 2006, net income on a non-GAAP basis(1) was $7.1 million. Basic and diluted non-GAAP net income per share for the three month period ended September 30, 2006 was $0.15 per share and $0.13 per share, respectively. Non-GAAP net income(1) for the three month period ended September 30, 2006 differs from GAAP net income as it excludes stock-based compensation charges of approximately $300,000, or $0.01 per share. The Company had no stock-based compensation charges in the same period in 2005. A reconciliation of GAAP to non-GAAP results is included at the end of this press release.
Results for Nine Month Period Ended September 30, 2006
For the nine month period ended September 30, 2006, total revenues increased 158% to $60.4 million from $23.4 million in the same period last year. For the nine month period ended September 30, 2006, net income was $18.1 million. Basic and diluted net income per share for the nine month period ended September 30, 2006 was $0.37 per share and $0.34 per share, respectively. The Company reported a net loss of $2.4 million, or $0.15 per share, in the same period last year. For the nine month period ended September 30, 2006, net income on a non-GAAP basis(1), was $18.5 million. Basic and diluted non-GAAP net income per share(1) for the nine month period ended September 30, 2006 was $0.38 per share and $0.35 per share, respectively. Non-GAAP net income(1) for the nine month period ended September 30, 2006 differs from GAAP net income as it excludes stock-based compensation charges of approximately $400,000, or $0.01 per share. The Company had no stock-based compensation charges in the same period in 2005. A reconciliation of GAAP to non-GAAP results is included at the end of this press release.
Subsequent to the completion of the third quarter of fiscal year 2006, the Company announced the closing of an initial public offering by Acme Packet of 9.7 million shares and by certain of its stockholders of approximately 3.5 million shares of its common stock, each at a price of $9.50 per share. The Company's common stock is listed on the Nasdaq Global Market under the symbol "APKT" and began trading on October 13, 2006. Cash proceeds to the Company, net of expenses, totaled approximately $83.7 million.
"We are pleased to announce record revenues and net income for the third quarter of fiscal 2006 and our fourth consecutive quarter of profitability. Our top line growth - which continues to be fueled by the broad support by new customers and new projects launched by existing customers - demonstrates the value that session border controllers (SBCs) play in advanced IP service creation and delivery," said Andy Ory, President and Chief Executive Officer of Acme Packet. "We look forward to expanding our clear industry and technology leadership in the SBC market as service providers worldwide look to leverage our innovative technology to deliver a robust suite of tiered services to their residential and business subscribers."
The following milestones were completed or announced during the three month period ended September 30, 2006.
-- The Company introduced several new session border control (SBC) configurations which feature subsets of Acme Packet's Net-Net(R) OS software technology used by Acme Packet's Net-Net Session Director (SD) - an integrated session border controller. The configurations, which are supported on the Company's Net-Net(R) 4000 and Net-Net(R) 9000 series hardware platforms, decompose the SBC into separate signaling and media control systems for Session Initiation Protocol (SIP) sessions, and include the Company's Net-Net Border Gateway, Session Controller and Signaling Firewall. These new configurations are designed to provide the Company's distribution partners and service provider customers with increased flexibility and scalability in implementing next-generation IP Multimedia Subsystem (IMS) and derivative service architectures.
-- The Company announced that its Acme Packet Net-Net(R) SBCs have been certified as XConnect Ready(TM) by Xconnect, a provider of "Plug and Peer" Voice over IP (VoIP) peering services and the operator of the XConnect Alliance. By using Acme Packet's Net-Net SBCs at their interconnect and peering borders while subscribing to XConnect's peering services, operators can reduce the costs of terminating VoIP calls to millions of telephone numbers in the XConnect registry.
-- The Company announced that its Acme Packet Net-Net(R) 4000 SBC has been accepted for listing by the United States Department of Agriculture's Rural Utilities Service (RUS), also known as Rural Development Utilities Programs (RDUP). This acceptance follows long standing deployments with numerous rural service providers in support of their business and residential VoIP services and allows qualifying rural telephone companies to purchase the Acme Packet Net-Net 4000 SBC with long-term, low-interest loans from the U.S. federal government.
-- The Company announced that it has launched Canadian operations with the opening of a sales and service presence in Ottawa, Ontario, the heart of Canada's "Silicon Valley North" high technology community. The Company established Canadian operations to better serve its customer base of incumbent and competitive service providers in Canada and to seek to grow its business in Canada.
-- The Company announced that Korea Telecom (KT), the largest service provider in Korea, is deploying Acme Packet's Net-Net(R) SBC in its national VoIP network that connects its residential and business customers. Upon completion of the deployment, KT expects to expand its current service offering of VoIP and high speed data with secure, high-quality multimedia IP services, all over its existing backbone infrastructure.
-- The Company announced that Brasil Telecom, the third largest fixed line service provider in Brazil, has selected Acme Packet's Net-Net(R) session border controllers for VoIPfone service, a SIP-based business and residential VoIP offering.
Business Outlook
The Company currently expects total revenues for the three month period ended December 31, 2006 to range between $22.0 million and $23.0 million and net income to range between $4.7 million and $5.2 million, or between $0.08 and $0.09 per share on a fully diluted basis. The Company expects non-GAAP(1) net income for the three month period ended December 31, 2006 to range between $5.0 million and $5.5 million, or between $0.08 and $0.09 per share on a fully-diluted basis. Non-GAAP(1) net income per share for the three month period ended December 31, 2006 differs from GAAP net income per share as it excludes estimated stock-based compensation charges of approximately $300,000.
Further, the Company expects total revenues for the twelve month period ended December 31, 2007 to range between $108.0 million and $112.0 million and GAAP net income to range between $16.5 million and $17.5 million, or between $0.25 and $0.27 per share on a fully diluted basis. The Company expects non-GAAP(1) net income for the twelve month period ended December 31, 2007 to range between $18.5 million and $19.5 million, or between $0.28 and $0.30 per share on a fully diluted basis. Non-GAAP(1) net income for the twelve month period ended December 31, 2007 differs from GAAP net income as it excludes estimated stock-based compensation of approximately $2.0 million, or $0.03 per share.
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