Altera Reports First Quarter Results; Sales Increase 12% Sequentially.Business Editors/High-Tech Writers SAN JOSE San Jose, city, United States San Jose (sănəzā`, săn hōzā`), city (1990 pop. 782,248), seat of Santa Clara co., W central Calif.; founded 1777, inc. 1850. , Calif.--(BUSINESS WIRE)--April 21, 2004 Altera Altera Corporation (NASDAQ: ALTR) is a leading manufacturer of programmable logic devices. It is a member of the NASDAQ-100 group of technology stocks and the S&P 500. Corporation (Nasdaq:ALTR) today announced first quarter sales of $242.9 million, up 12% from the fourth quarter of 2003, and 25% from the first quarter of 2003. Sales of the company's new products grew 32% sequentially se·quen·tial adj. 1. Forming or characterized by a sequence, as of units or musical notes. 2. Sequent. se·quen . First quarter net income was $58.8 million, $0.15 per diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. share, up 95% versus net income of $30.1 million, $0.08 per diluted share, in the first quarter of 2003. Gross margin was 68.8% for the first quarter of 2004 versus 67.1% for the first quarter of 2003. Gross margin included a 150 basis point ($3.6 million) benefit in the first quarter of 2004 and a 470 basis point ($9.1 million) benefit in the first quarter of 2003 resulting from the sale of inventory previously written down in 2001. Altera repurchased 2.3 million shares of its common stock during the quarter at a cost of $51.6 million and ended the quarter with $1.1 billion in cash and short-term Short-term Any investments with a maturity of one year or less. short-term 1. Of or relating to a gain or loss on the value of an asset that has been held less than a specified period of time. investments. "This has been another quarter with outstanding growth from our new products. Sales of Cyclone cyclone, atmospheric pressure distribution in which there is a low central pressure relative to the surrounding pressure. The resulting pressure gradient, combined with the Coriolis effect, causes air to circulate about the core of lowest pressure in a (TM) devices continue to ramp, with one million units shipped in this quarter, bringing our cumulative shipments to 2 million units. Cyclone devices are the clear leader among the newest generation low-cost FPGAs. In the high-density high-den·si·ty adj. Having a high concentration: high-density urban areas. market, the combination of Stratix(R) devices and our HardCopy (jargon) hardcopy - A paper printout of data displayed on a screen. Contrast softcopy. (R) solution continues to draw new customers to Altera, adding to our new product momentum," said John Daane, president and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. . "We announced two next generation products during the quarter - both based on truly unique Altera architectures. Our 90-nm Stratix II devices use the industry's first adaptable a·dapt·a·ble adj. Capable of adapting or of being adapted. a·dapt  a·bil FPGA (Field Programmable Gate Array) A type of gate array that is programmed in the field rather than in a semiconductor fab. Containing up to hundreds of thousands of gates, there are a variety of FPGA architectures on the market. architecture and are the
industry's largest and fastest chips, offering performance and
capabilities previously only available in ASICs and ASSPs. In addition,
the MAX(R) II CPLD (Complex PLD) A programmable logic device that is made up of several simple PLDs (SPLDs) with a programmable switching matrix in between the logic blocks. CPLDs typically use EEPROM, flash memory or SRAM to hold the logic design interconnections. See PLD and SPLD. family signals the arrival of a radically different
CPLD architecture. The MAX II family provides a superior solution for
today's CPLD customers and the opportunity for Altera to set a new
standard for the industry."Altera continued to advance its leadership position in system-on-a-programmable-chip (SOPC SOPC System on a Programmable Chip SOPC Special Operations Preparation Course SOPC Second-Order Power Control SOPC Shuttle Operations and Planning Center SOPC 1-Stearoyl-2-Oleoyl-Sn-Glycero-3-Phosphatidylcholine SOPC Shaastra Online Programming Contest ) solutions. -- Altera's HardCopy Stratix structured ASIC A type of application specific IC (ASIC) chip that contains blocks of logic, called "tiles" or "modules," that have their transistors already wired together forming gates along with some combination of multiplexors, flip/flops, look up tables and the like. has been named EDN's Innovation of the Year winner. Altera received the same award in 2003 for its Stratix family of FPGAs. These awards, which honor As a verb, to accept a bill of exchange, or to pay a note, check, or accepted bill, at maturity. To pay or to accept and pay, or, where a credit so engages, to purchase or discount a draft complying with the terms of the draft. outstanding products in the electronics industry, are the result of selection by EDN's technical editors and online voting by EDN's worldwide readers. Altera's second straight win in this category reaffirms the company's ongoing success in delivering innovative solutions and highlights the company's leadership in the rapidly emerging structured ASIC market. -- In order to capture the full performance potential of the advanced 90-nm process, Altera's newly announced Stratix II family was developed with the industry's first adaptable FPGA architecture. More efficient than previous approaches, the unique 90-nm based Stratix II architecture enables the Stratix II family to offer more than double the logic density with performance 50% faster than first-generation first-gen·er·a·tion adj. 1. Of or relating to a person who has left one country and settled in another. 2. Of or relating to a person or persons whose parents are immigrants. 3. Stratix devices. The combination of 90-nm process benefits and this unique architecture also delivers dramatically lower pricing for Altera's customers. As a result, the Stratix II family is an attractive alternative to many of the more costly and less flexible ASICs, ASSPs, microprocessors This is a list of microprocessors. Intel
processing (DSP (1) (Digital Signal Processor) A special-purpose CPU used for digital signal processing applications (see definition #2 below). It provides ultra-fast instruction sequences, such as shift and add, and multiply and add, which are commonly used in math-intensive ) solutions traditionally employed in today's electronic systems. -- Building on more than a decade of CPLD leadership and innovation, Altera has announced the MAX II family, which offers customers half the cost, one-tenth the power, four times the density, and twice the performance of the previous MAX generation. In contrast to traditional CPLDs, MAX II devices are built on a 0.18-micron embedded Inserted into. See embedded system. flash-based process utilizing a look-up-table architecture. With a resulting die size one quarter that of competing CPLDs, the MAX II family delivers, in a single reprogrammable chip, nonvolatile See non-volatile. instant-on Refers to software-based computers, PDAs and cellphones that are immediately available for user input right after they are powered on. It implies that the software, or at least a primary component of the software, is stored in a non-volatile memory and does not have to be loaded from capability at dramatically lower prices. The MAX II family is now fully supported in Altera's Quartus Quartus (Latin "fourth") was a Corinthian Christian who sent messages to friends in Rome through Paul of Tarsus. He is mentioned in Rom. 16:23. This entry incorporates text from the public domain Easton's Bible Dictionary, originally published in 1897. (R) II software. Initial devices are expected to ship mid-year. -- Recent benchmarking
Benchmarking (also "best practice benchmarking" or "process benchmarking") is a process used in management and particularly strategic analysis confirms that Altera's newest generation products outperform Outperform An analyst recommendation meaning a stock is expected to do slightly better than the market return. Notes: Exact definitions vary by brokerage, but in general this rating is better than neutral and worse than buy or strong buy. the competition and deliver unrivalled performance to Altera's customers. These results are a direct consequence of a customer focused development process and the creation of innovative architectures that leverage the full performance potential available at the industry's most advanced process nodes. Comparing Stratix II, MAX II, and Cyclone performance against the leading competitive offerings demonstrate a consistent and significant Altera performance advantage. Compared to other high-density FPGAs, Stratix II devices outperform Xilinx's Virtex-II Pro by on average 50%. Among high-volume FPGAs, Altera's 130-nm based Cyclone devices outperform Xilinx's 90-nm Spartan-3 devices by on average more than 70%. In the CPLD category, the MAX II family outperforms Lattice's ispXPLD CPLDs by on average 80% and Xilinx's CoolRunner devices by on average 50%. Comparisons are based on customer design suites ranging from 50 to 100 designs. Complete details are available at www.altera.com. Conference Call and Quarterly Update: A conference call will be held today at 1:45 p.m. Pacific Time to discuss the quarter's results and management's outlook for the second quarter. The webcast and subsequent replay will be available in the investor relations Investor relations The process by which the corporation communicates with its investors. section of the company's web site at http://www.altera.com. A telephonic replay of the call may be accessed later in the day by calling (719) 457-0820 and referencing confirmation code 258712. The telephonic replay will be available for two weeks following the live call. Altera's second quarter business update will be made available on June June: see month. 1 after the market close and will be posted on the company's web site. Those who do not have access to the Internet Internet Publicly accessible computer network connecting many smaller networks from around the world. It grew out of a U.S. Defense Department program called ARPANET (Advanced Research Projects Agency Network), established in 1969 with connections between computers at the may contact Altera's investor relations department directly at 408-544-7707. Forward-Looking Statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. Statements in this press release that are not historical are "forward-looking statements," as the term is defined in the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995. Forward-looking statements are generally written in the future tense future tense n. A verb tense expressing future time. Noun 1. future tense - a verb tense that expresses actions or states in the future future and/or and/or conj. Used to indicate that either or both of the items connected by it are involved. Usage Note: And/or is widely used in legal and business writing. preceded by words such as "will", "expects", or words that imply or predict a future state. Investors are cautioned that all forward-looking statements in this release involve risks and uncertainty which can cause actual results to differ from those currently anticipated, due to a number of factors, including without limitation, the risk that future performance is dependent on the design performance of software and other tools, customer business environment, Altera's ability to meet product introduction schedules, the company's success at penetrating penetrating breaching the tissues of the body. new markets and applications, market acceptance of the company's products, the rate of growth of the company's new products and in particular the Stratix, Stratix GX, and Cyclone device families, as well as changing economic conditions, and other risk factors discussed in documents filed by the company with the Securities and Exchange Commission from time to time. Copies of Altera's SEC filings are posted on the company's web site and are available from the company without charge. Forward-looking statements are made as of the date of this release and, except as required by law, the company does not undertake an obligation to update its forward-looking statements to reflect future events or circumstances CIRCUMSTANCES, evidence. The particulars which accompany a fact. 2. The facts proved are either possible or impossible, ordinary and probable, or extraordinary and improbable, recent or ancient; they may have happened near us, or afar off; they are public or . About Altera Altera Corporation (Nasdaq:ALTR) is the world's pioneer of system-on-a-programmable-chip (SOPC) solutions. Combining programmable logic See PLD. technology with software tools, intellectual property, and technical services, Altera provides high-value programmable solutions to approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. 14,000 customers worldwide. More information is available at http://www.altera.com. Altera, The Programmable Solutions Company, the stylized styl·ize tr.v. styl·ized, styl·iz·ing, styl·iz·es 1. To restrict or make conform to a particular style. 2. To represent conventionally; conventionalize. Altera logo, specific device designations and all other words that are identified as trademarks and/or service marks are, unless noted otherwise, the trademarks and service marks of Altera Corporation in the U.S. and other countries. All other product or service names are the property of their respective holder.
ALTERA CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data and note)
(Unaudited)
THREE MONTHS ENDED
-----------------------------
Apr. 2 Jan. 2 Apr. 4
2004 2004 2003
--------- --------- ---------
Net sales $242,908 $217,426 $195,076
Costs and expenses:
Cost of sales 75,841 70,613 64,258
Research and development 42,582 41,274 50,188
Selling, general, and administrative 49,878 47,869 44,203
--------- --------- ---------
Total costs and expenses 168,301 159,756 158,649
--------- --------- ---------
Income from operations 74,607 57,670 36,427
Interest and other income, net 3,736 4,167 4,836
--------- --------- ---------
Income before income taxes 78,343 61,837 41,263
Provision for income taxes (19,586) (16,695) (11,141)
--------- --------- ---------
Net income $58,757 $45,142 $30,122
========= ========= =========
Income per share:
Basic $0.16 $0.12 $0.08
========= ========= =========
Diluted $0.15 $0.12 $0.08
========= ========= =========
Shares used in computation:
Basic 375,736 378,199 382,637
========= ========= =========
Diluted 385,793 388,299 388,253
========= ========= =========
Tax rate 25.0% 27.0% 27.0%
% of Sales:
Gross margin 68.8% 67.5% 67.1%
Research and development 17.5% 19.0% 25.7%
Selling, general, and
administrative 20.6% 22.0% 22.7%
Income from operations 30.7% 26.5% 18.7%
Net income 24.2% 20.8% 15.4%
Note: Statements of operations for the three month periods ended
April 2, 2004, January 2, 2004, and April 4, 2003 included benefits of
$3.6 million, $3.1 million and $9.1 million, respectively, resulting
from the sale of inventory previously written down in 2001. Such
benefits had a favorable gross margin impact of 1.5%, 1.4%, and 4.7%,
respectively.
ALTERA CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(Dollars in thousands)
(Unaudited)
Apr. 2 Jan. 2
2004 2004
----------- -----------
Assets
Current assets:
Cash and short-term investments $1,054,022 $1,031,890
Accounts receivable, net 129,649 87,204
Inventories 46,674 44,583
Other current assets 116,904 106,355
----------- -----------
Total current assets 1,347,249 1,270,032
Long-term investments - 14,451
Property and equipment, net 158,372 160,924
Intangible and other assets, net 40,309 42,199
----------- -----------
$1,545,930 $1,487,606
=========== ===========
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable and current liabilities $ 157,775 $ 139,781
Deferred income and allowances on sales to
distributors 262,811 245,421
----------- -----------
Total current liabilities 420,586 385,202
Stockholders' equity 1,125,344 1,102,404
----------- -----------
$1,545,930 $1,487,606
=========== ===========
Key Ratios & Information
Current Assets/Current Liabilities 3:1 3:1
Liabilities/Equity 1:3 1:3
Annualized Return on Equity 21% 14%
Quarterly Depreciation Expense $6,964 $10,875
Quarterly Capital Expenditures $4,412 $4,615
Annualized Sales per Employee $483 $426
Number of Employees 2,028 1,995
Inventory MSOH (a): Altera 1.8 1.9
Inventory MSOH (a): Distribution 1.7 1.7
Days Sales Outstanding 49 36
(a) MSOH: Months Supply On Hand
ALTERA CORPORATION
REVENUE SUMMARY
(Unaudited)
Q-Q Y-Y
Q1'04 Q4'03 Q1'03 Growth Growth
----- ----- ----- ------ ------
Geography
---------
North America 30% 31% 34% 9% 11%
----- ----- -----
Europe 24% 21% 25% 31% 20%
Japan 25% 24% 25% 15% 24%
Asia Pacific 21% 24% 16% -4% 61%
----- ----- -----
International 70% 69% 66% 13% 32%
----- ----- -----
Total 100% 100% 100% 12% 25%
===== ===== =====
Product Category
----------------
New 19% 16% 7% 32% 245%
Mainstream 46% 47% 52% 8% 10%
Mature & Other 35% 37% 41% 7% 6%
----- ----- -----
Total 100% 100% 100% 12% 25%
===== ===== =====
Market Segment
--------------
Communications 42% 47% 42% 1% 25%
Industrial 32% 29% 31% 23% 27%
Computer & Storage 11% 11% 11% 14% 21%
Consumer 15% 13% 16% 23% 20%
----- ----- -----
Total 100% 100% 100% 12% 25%
===== ===== =====
Product Category Description
----------------------------
Category Products
New Stratix, Stratix GX, Cyclone, MAX 3000A, and HardCopy
devices
Mainstream APEX 20K, APEX 20KC, APEX 20KE, APEX II, FLEX 10KE,
ACEX 1K, Excalibur, Mercury, MAX 7000A, and MAX 7000B
devices
Mature & Other FLEX 6000, FLEX 8000, FLEX 10K, FLEX 10KA, MAX 7000,
MAX 7000S, MAX 9000, Classic, configuration and other
devices, software and other tools, and intellectual
property cores
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