Nuance Announces Third Fiscal Quarter 2007 Results
biz.yahoo.com
Tuesday August 7, 7:18 am ET
Strong Performance across Speech Markets Drives Robust Revenue, Earnings and Cash Flows
BURLINGTON, Mass.--(BUSINESS WIRE)--Nuance Communications, Inc. (NASDAQ: NUAN) today announced financial results for the third fiscal quarter ended June 30, 2007.
Nuance reported revenues of $156.6 million in the quarter ended June 30, 2007, a 39 percent increase over revenues of $113.1 million in the quarter ended June 30, 2006. In addition to using GAAP results in evaluating the business, management also believes it is useful to evaluate results using non-GAAP measures. Using a non-GAAP measure, the Company reported non-GAAP revenue of approximately $157.0 million which includes $0.3 million in revenue lost to purchase accounting in conjunction with the Company's acquisitions of Dictaphone Corporation and BeVocal, Inc. Using the non-GAAP measure, revenues grew 30 percent over the same quarter last year.
On a GAAP basis, Nuance recognized a net loss of $7.6 million, or $(0.04) per share, in the quarter ended June 30, 2007, compared with a net loss of $9.4 million, or $(0.06) per share, in the quarter ended June 30, 2006. Using a non-GAAP measure, Nuance reported non-GAAP net income of $27.8 million, or $0.14 per diluted share, for the period ending June 30, 2007, compared to non-GAAP net income of $19.7 million, or $0.11 per diluted share, in the quarter ended June 30, 2006.
The non-GAAP revenue amount includes revenue lost to purchase accounting in conjunction with the Company's acquisitions of Dictaphone Corporation and BeVocal, Inc. The non-GAAP net income amount excludes non-cash taxes and interest, amortization of intangible assets, non-cash amortization of stock-based compensation, and acquisition-related transition and integration costs and charges. See "GAAP to non-GAAP Reconciliation" below for further information on the Company's non-GAAP measures.
"Nuance experienced solid growth in its embedded, network and healthcare speech business lines, fueling strong revenue and earnings above expectations," said Paul Ricci, chairman and CEO of Nuance. "These results further demonstrate our ability to extend Nuance's position in the global speech industry and to realize the benefits and synergies of recent acquisitions."
Consistent with the Company's strategy and recent trends, highlights from the quarter include:
* Enterprise Speech - Network enterprise speech revenues were a record organically, up sequentially and year-over-year owing to demand for customer care solutions powered by speech across a breadth of industries. Significant agreements for both new customers and expanded deployments included AT&T, Dell, HSBC, TIAA-CREF and Ticketmaster. Nuance experienced accelerating demand for its customer care offerings as it moves from providing enabling technologies to richer solutions that improve the quality and consistency of customer communications.
* Healthcare Dictation and Transcription - Dictaphone healthcare revenues in the quarter were also at record levels, as the demand for dictation and transcription solutions within hospitals and healthcare facilities continued to grow. The Company sustained strong demand and revenue growth for its iChart hosted transcription services, signing several multi-million dollar, extended-term contracts in the quarter.
* Embedded Speech - Nuance embedded speech revenues achieved record levels in the quarter, up 46 percent year-over-year. Performance owed to accelerated royalties and strategic relationships with manufacturers including Daimler Chrysler, Ford, LG, Mercedes, Mitsubishi, Texas Instruments and a leading provider of personal navigation devices.
* Voice Search and Communications - Nuance expanded its offerings and initiatives in voice search and mobile communications. The Company delivered Nuance Voice Search, a portfolio of solutions that provide enhanced capabilities for ad-based solutions and business category search. Continued performance owed to voice search and connected services through customers and partners including AT&T, Handango, Jingle Networks, Palm, RIM, Rogers Wireless, SwissCom and Verizon.
* PDF and Imaging Solutions - Nuance delivered a strong quarter for its PDF solutions with revenues up sequentially and year-over-year. These strengths though were offset by comparatively weaker performance of scanning applications as the Company approached the impending launch of OmniPage 16 and against a quarter last year that included a significant license.
* Operational Achievement - Nuance continued its focus on disciplined acquisition integration, cost synergies and expense controls, which resulted in improvements and leverage in its operating margins. In addition, cash flows from operations were approximately $30.3 million, up from $17.6 million in Q3 2006.
* Strategic Acquisitions - The Company announced the acquisitions of VoiceSignal and Tegic Communications, adding proven solutions, broad industry relationships and talented employees that enhance Nuance's position in mobile markets. The companies present compelling opportunities for Nuance with respect to their technical and operational capabilities, respective growth trajectories and financial returns afforded shareholders. Nuance expects these acquisitions will close during its fourth fiscal quarter. |
