Company Posts Record Quarterly Revenues
Company Affirms Previous Outlook for Revenue and Non-GAAP(1) Net Income
BURLINGTON, Mass.--(BUSINESS WIRE)--Acme Packet, Inc. (NASDAQ: APKT - News), the leader in session border control solutions, today announced results for its first quarter ended March 31, 2007. The Company also affirmed its previously issued outlook for revenue and non-GAAP(1) net income in 2007.
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Total revenues for the three month period ended March 31, 2007 were $25.1 million, an increase of 33% compared to total revenues of $18.9 million for the same period last year. Net income for the three month period ended March 31, 2007 was $4.3 million, or $0.06 per share on a diluted basis. Net income on a non-GAAP basis(1) for the three month period ended March 31, 2007 was $5.0 million, or $0.08 per share on a diluted basis. Non-GAAP net income(1) for the three month period ended March 31, 2007 differs from GAAP net income as it excludes stock-based compensation expense, net of tax, of approximately $737,000, or $0.02 per share on a diluted basis. A reconciliation of GAAP to non-GAAP results is included at the end of this press release. Net income for the three month period ended March 31, 2006 was $6.0 million, or $0.11 per share on a diluted basis. The Company's results during the three month period ended March 31, 2007 reflect a fully effective GAAP tax rate of approximately 38%. In contrast, the Company recorded a fully effective GAAP tax rate of approximately 3% during the three month period ended March 31, 2006, which represented a provision for United States Federal Alternative Minimum Tax and certain foreign taxes as the Company utilized net operating loss carryforwards and tax credits to offset taxable income.
"We are pleased to report that our new fiscal year is off to a strong start and our execution is continuing as planned," said Andy Ory, President and Chief Executive Officer of Acme Packet, Inc. "Strong traction in both new and existing customers enabled us to achieve record revenues and non-GAAP(1) pre-tax income in the first quarter of 2007. These results continue to reflect the growing importance that our SBC solutions have in the way that our nearly 400 service provider customers deliver IP-based interactive communication services to their customers."
Company Comments on Business Outlook for 2007
The Company reaffirmed its previously issued expectation for total revenues in 2007 to range between $108.0 million and $112.0 million with sequential growth in each quarter of the year. The Company expects GAAP net income to range between $14.5 million and $15.5 million, or between $0.22 and $0.24 per share on a diluted basis. The Company reaffirmed its previously issued expectation for total non-GAAP(1) net income in 2007 to range between $18.5 million and $19.5 million, or between $0.28 and $0.30 per share on a diluted basis. The Company's outlook for non-GAAP(1) net income differs from GAAP net income in 2007 as it excludes estimated stock-based compensation expense, net of tax, of approximately $4.0 million, or $0.06 per share on a diluted basis. The Company's previously issued outlook assumed estimated stock-based compensation expense, net of tax, of approximately $2.0 million, or $0.03 per share on a diluted basis. Since issuing its earlier estimate for stock-based compensation expense in 2007, the Company has updated its projected stock-based compensation expense based on actual and projected stock option awards for new and existing employees. The Company's estimated stock-based compensation expense has no impact on estimated non-GAAP(1) net income in 2007. The Company's outlook for 2007 assumes a fully effective non-GAAP tax rate of 35%. In contrast, the Company recorded a fully effective non-GAAP tax rate of approximately 5% in 2006. The Company expects its full year weighted average diluted share count to be approximately 66.5 million in 2007 as compared to 57.4 million in 2006.
Operational Highlights
The following milestones were completed or announced since the Company's fourth quarter of fiscal year 2006 ended on December 31, 2006:
* The Company announced that two leading market research firms, Dell'Oro Group and Infonetics Research, found that the Company gained significant market share in the session border controller (SBC) market in 2006. In their fourth quarter 2006 reports on the service provider VoIP equipment market, both firms showed the Company as the leading SBC vendor with market share over two times that of its closest competitor. Specifically, Infonetics Research reported that Acme Packet achieved 56% market share based on 2006 revenue.
* The Company announced it has received its seventh U.S. patent, its 22nd overall, for its Net-Net SBC product family. The seven U.S. patents and 15 additional foreign patents cover many of the key features and techniques used by SBCs and represent a broad portfolio of intellectual property developed over seven years. The most recent patent entitled "System and Method for Providing Session Admission Control", covers the Company's flexible call admission control algorithms.
* The Company announced that it had been honored by the Massachusetts Network Communications Council (MassNetComms) with two prestigious awards at the Council's annual awards ceremony held on April 4, 2007. Acme Packet was recognized as Public Company of the Year as well as Fastest Growth in Massachusetts for 2006. MassNetComms supports more than 230 telecommunications, Internet, software and application companies and affiliated organizations throughout the Commonwealth of Massachusetts and New England.
* The Company announced over fifty new features and enhancements that further extend the control capabilities of the Company's Net-Net SBCs for interconnecting IP VoIP, video and multimedia networks to one another. These features, delivered in Net-Net OS Release 5.0, advance the functions of the Net-Net SBCs in the areas of security, service reach maximization, SLA assurance, revenue and profit protection and regulatory compliance.
* The Company announced that its Net-Net SBCs now support the DIAMETER protocol towards Resource and Admission Control Functions and Connectivity session Location repository Functions, which form an integral part of next generation IMS networks. DIAMETER is used for several IMS functions, including the interface between SBCs and policy servers for resource reservation for VoIP and other interactive IP communication sessions. The Company also announced that it had expanded its partner list to include CableMatrix and Juniper Networks and is testing DIAMETER interoperability between its Net-Net SBC and policy servers from CableMatrix, Camiant, Juniper and Operax. |
