AvantGo Posts 87% Year-over-year Growth as Operating Loss Declines for Third Straight Quarter.Business Editors and High Tech Writers SAN MATEO San Mateo (săn mətā`ō), city (1990 pop. 85,486), San Mateo co., W Calif., on San Francisco Bay; inc. 1894. It is a commercial and retail center with some high-technology manufacturing. San Mateo, Spanish for St. , Calif.--(BUSINESS WIRE)--July 24, 2001 AvantGo, Inc. (Nasdaq: AVGO), the leading provider of mobile infrastructure software and services, today reported its financial results for the second quarter ended June 30, 2001. Revenues for the quarter were $6.5 million, representing an 87% increase over revenues of $3.5 million for the same quarter last year, and gross margins were 78%. The Company continued on its path to profitability by narrowing its operating losses operating loss The excess of operating expenses over revenue. As with operating income, operating losses exclude revenues and expenses from operations that are not considered a regular part of the business. Also called deficit. Compare operating income. for the third straight quarter. The net loss, before extraordinary and non-cash charges Non-Cash Charge A charge off, made by a company against earnings, that does not require an initial outlay of cash. Notes: Non-cash charges are typically against the depreciation, amortization, and depletion accounts on a company's balance sheet. , was $7.9 million versus $9.0 million in the first quarter of 2001. Pro forma As a matter of form or for the sake of form. Used to describe accounting, financial, and other statements or conclusions based upon assumed or anticipated facts. The phrase pro forma net loss per share before non-cash charges was $0.25 for the quarter compared with a loss of $0.29 per share in the first quarter of 2001. "We are pleased to announce that EPS (Encapsulated PostScript) A PostScript file format used to transfer a graphic image between applications and platforms. EPS files contain PostScript code as well as an optional preview image in TIFF, WMF, PICT or EPSI, the latter being an ASCII-only format. exceeded analysts' estimates for the fourth consecutive quarter since going public last fall. Despite a difficult selling environment, we continued to improve our operating performance in the second quarter by reducing operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. ," said David Cooper David Cooper may be:
As previously announced, the Company took a restructuring charge restructuring charge The expense of reorganizing a company's operations. A restructuring charge is an infrequent expense that generally results from asset writedowns or facility closings. in the second quarter, incurring one-time severance costs of approximately $400,000, and a non-cash charge of $2.4 million associated with the disposal of excess office space. Mobile Leader Focuses on Fortune 1000 Enterprises Over 29 major organizations, including Eli Lily, Pfizer, Enron, Lexis-Nexis, GMAC GMAC General Motors Acceptance Corporation GMAC Graduate Management Admission Council GMAC Give Me A Call GMAC Genetic Manipulation Advisory Committee GMAC Genetic Modification Advisory Committee (Singapore) GMAC Give Me A Chance , Siemens, Unilever, British Petroleum, Hewlett-Packard and Glaxo Smith Kline purchased AvantGo M-Business Server solutions in the second quarter to mobilize mo·bi·lize v. 1. To make mobile or capable of movement. 2. To restore the power of motion to a joint. 3. To release into the body, as glycogen from the liver. their workforce and customer-focused applications. More than 20% of new sales were to repeat customers, demonstrating the increasing deployments of AvantGo mobile applications throughout large enterprises. During the second quarter, AvantGo shipped its AvantGo 4.0 M-Business Server for RIM BlackBerry blackberry, name for several species of thorny plants of the genus Rubus of the family Rosaceae (rose family). See bramble. blackberry Wireless Handhelds(TM). The software operates seamlessly with the Web-based and messaging solutions the Company has been shipping for Microsoft Windows-powered Pocket PCs, Palm OS-based handhelds and Internet-enabled phones. AvantGo M-Business Server allows businesses to deploy applications to their mobile workforces, partners and customers using existing network infrastructure, Internet standards See Internet Engineering Task Force. and wireless devices, without having to write specialized software for each device or connectivity alternative. The Company also recently expanded its mobile offerings to include packaged enterprise applications that complement its award-winning mobile infrastructure product. AvantGo Mobile Sales(TM) software is the first in a series of mobile applications that connect with and extend existing applications to corporations' mobile workforces. AvantGo's mobile applications are designed to be rapidly deployed and to dramatically increase the return on corporations' existing technology investments. AvantGo Mobile Sales software allows sales professionals to view and update critical sales information from leading customer relationship management (CRM (Customer Relationship Management) An integrated information system that is used to plan, schedule and control the presales and postsales activities in an organization. ) applications, such as Onyx onyx (ŏn`ĭks), variety of cryptocrystalline quartz, differing from agate only in that the bands of which it is composed are parallel and regular. , Oracle and Siebel Systems Siebel is a brand name of Oracle Corporation. Siebel Systems, Inc., founded by Thomas Siebel in 1993, was principally engaged in the design, development, marketing and support of CRM applications. with their personal digital assistants and Internet-enabled phones. AvantGo Mobile Sales software provides wireless access to critical sales information, including opportunities, contacts, service requests and inventory. AvantGo's Mobile Sales software is designed to greatly increase the ROI (Return On Investment) The monetary benefits derived from having spent money on developing or revising a system. In the IT world, there are more ways to compute ROI than Carter has liver pills (and for those of you who never heard of that expression, it means a lot). of existing CRM investments, by allowing sales professionals to more effectively manage customer relationships while keeping sales management Sales Management Role and Goal Importance of sales management is critical for any commercial organization. Expanding business in not possible without increasing sales volumes, and effective sales management goal is to organize sales team work in such a manner that ensures a armed with up-to-date information, thereby boosting workforce productivity and effectiveness. AvantGo's unique Dynamic Mobility Model(TM) allows sales professionals to continue to conduct business, even when a wireless connection is unavailable or interrupted. "Enterprises are adopting our mobile solutions because they deliver an immediate ROI on existing technology systems and they work well, under real-life conditions, when wireless signals fade or fail," said Richard Owen Sir Richard Owen KCB (July 20 1804–December 18 1892) was an English biologist, comparative anatomist and palaeontologist. He was widely regarded as malicious and dishonest but he was also one of the most brilliant and influential biologists of his time. , AvantGo's 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 realized early on that corporations require the ability to deliver mission-critical information securely, online, offline and through push notification technologies, which is why we support the Dynamic Mobility Model." The Company also announced that its AvantGo mobile Internet Refers to gaining access to the Internet using a lightweight, handheld device. See Mobile IP, PDA, smartphone and mobile TV. service has reached another leadership milestone. The service now has over 3 million registered users, making it the most widely used service for accessing content and applications via smart devices in the world. The hosted network enables over 1500 businesses to generate revenue, extend their brand, reduce customer care costs and increase the overall lifetime value of their customer relationships. New customers in the second quarter included Mercedes, Sprint PCS, Warner Brothers Warner Brothers (b. Eichelbaums) movie executives; Harry (Morris) (1881–1958), born in Krasnashiltz, Poland; Albert (1884–1967), born in Baltimore, Md.; Samuel (1887–1927), born in Baltimore, Md. , KPMG KPMG Klynveld Peat Marwick Goerdeler (accounting firm) KPMG Kaiser Permanente Medical Group KPMG Keiner Prüft Mehr Genau (German) KPMG Kommen Prüfen Meckern Gehen , Astra Zeneca and SAP. AvantGo Hosts Investor Call AvantGo's second quarter financial results will be discussed July 24, 2001 at 2:00 PM PDT/5:00 PM EDT EDT abbr. Eastern Daylight Time EDT Eastern Daylight Time EDT n abbr (US) (= Eastern Daylight Time) → hora de verano de Nueva York EDT , and will be available via a live webcast on the Company's website, under the navigation bar A set of buttons or graphic images typically in a row or column used as a central point that link you to major topic sections on a Web site. If the navigation bar is a single graphic image with multiple selections, it is known as an imagemap. See imagemap. "investor relations Investor relations The process by which the corporation communicates with its investors. ," or at www.streetevents.com. A replay also will be available from the Company's website through August 8, 2001. About AvantGo AvantGo, Inc. (Nasdaq: AVGO) is the leading provider of infrastructure software and services that power the mobile economy. AvantGo M-Business software enables businesses to increase the value of their corporate information systems by extending existing enterprise applications and critical information to employees, customers and business partners. The company also provides the AvantGo mobile Internet service, a hosted network that enables hundreds of businesses to deliver their content and applications to more than 3 million mobile consumers. AvantGo is a pioneer in delivering real-world solutions for both wireless and off-line use. For more information, please visit www.avantgo.com. Cautionary Statement This news release regarding second quarter financial results includes 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. , including, but not limited to, the belief that our current cash reserves Cash reserves See: Cash investments cash reserves Investment funds that are held in short-term assets such as Treasury bills and certificates of deposit until more permanent investment opportunities are available. will be adequate to achieve profitability. These forward looking statements are subject to a number of risks, uncertainties and other factors that could cause actual results to differ materially. Such factors include, but are not limited to, the following: general business and economic conditions, and growth in the adoption of mobile infrastructure technology, software investments and mobile advertising in the market in which we market our products and services; quarterly fluctuations in AvantGo's revenues or other operating results; risks related to market acceptance of AvantGo's products and services, and the products and services of AvantGo's customers and partners which integrate or interoperate See interoperable. with AvantGo technologies; pricing pressures, including the pricing that content providers and advertisers are willing to pay us in connection with our AvantGo mobile Internet service; the pricing of our enterprise products and the rates that we are able to charge for our professional services (job) professional services - A department of a supplier providing consultancy and programming manpower for the supplier's products. ; AvantGo's failure to meet financial expectations of analysts and investors; errors in forecasting or inability to meet sales goals; inability to control costs; termination of important contracts including those with Ford Motor Company and McKessonHBOC; customer dissatisfaction, failure to close anticipated key enterprise agreements; slowdown in the adoption of mobile devices for which the market for AvantGo's software and services is dependent; changes in customer order patterns; the impact of long sales and implementation cycles for AvantGo's enterprise products; unanticipated costs or other adverse effects associated with software bugs A problem that causes a program to produce invalid output or to crash (lock up). The problem is either insufficient logic or erroneous logic. For example, a program can crash if there are not enough validity checks performed on the input or on the calculations themselves, and the computer ; continued success in technological advances, including development and implementation of new products and services that are interoperable The ability for one system to communicate or work with another. See interoperability. with those of its customers and partners; delays in the development or introduction of such products and services; AvantGo's ability to manage growth and successfully integrate and operate any acquired businesses; AvantGo's ability to further its brand awareness and market effectively the functionality of its software; competitive factors, such as the release of competitive products and services; marketing programs and other actions by competitors; technical difficulties with networks or operating systems Operating systems can be categorized by technology, ownership, licensing, working state, usage, and by many other characteristics. In practice, many of these groupings may overlap. on which we rely to deliver some of our services; AvantGo's need to maintain and enhance business relationships with leading hardware and software manufacturers, important partners, content providers and other parties; the ability of AvantGo partners and customers to timely develop and deliver to market viable products and services; AvantGo's ability to attract new employees, particularly in the sales and engineering groups; retention of key personnel; AvantGo's activities and those of others regarding protection of intellectual property; the California energy crisis and its impact on operating costs operating costs npl → gastos mpl operacionales and our ability to operate our business and provide the AvantGo mobile Internet service; other factors which increase operating costs; rapid inflation; general economic downturns; the possible emergence of a credit crisis affecting cash balances invested in money market funds and other investment instruments; and, the impact of events outside the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. such as the business impact of fluctuating currency rates or unrest or political instability in a locale (programming) locale - A geopolitical place or area, especially in the context of configuring an operating system or application program with its character sets, date and time formats, currency formats etc. Locales are significant for internationalisation and localisation. . Further details on these risks are set forth in our filings with the Securities and Exchange Commission, including our Form S-1 which was declared effective by the SEC on September 27, 2000, our quarterly report on Form 10-Q Form 10-Q See 10-Q. for the quarters ended September 30, 2000 and March 31, 2001, and our annual report on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. for the year ended December 31, 2000. These filings are available on a website maintained by the Securities and Exchange Commission at http://www.sec.gov. Forward-looking statements in this release are generally identified by words such as "forecast," "project," "expect," "anticipate,"' "intend," "believe," "assume," "estimate," "goal," "plan" and other similar words and expressions. AvantGo does not undertake an obligation to update forward-looking statements. AvantGo, AvantGo Enterprise and the AvantGo logo are either registered trademarks or trademarks of AvantGo in the United States and/or other countries. The names of actual companies and products mentioned herein may be the trademarks of their respective owners.
AvantGo, Inc.
Consolidated Statements of Operations
(In thousands, except per share data)
Quarter Ended Year-to-Date
June 30, June 30,
2001 2000 2001 2000
---- ---- ---- ----
(unaudited) (unaudited)
Revenues:
License fees $ 4,032 $ 2,061 $ 8,095 $ 2,814
Services 2,437 1,395 5,681 2,303
-------- -------- -------- --------
Total revenues 6,469 3,456 13,776 5,117
Costs and expenses:
Cost of license fees 57 51 82 78
Cost of services 1,397 866 2,816 1,413
Product development 3,205 1,965 7,199 3,110
Sales and marketing 7,545 6,392 15,850 9,637
General and
administrative 3,033 1,562 6,405 2,682
Purchased in-process
research and development -- 600 -- 600
Amortization of goodwill,
intangible assets and
deferred stock compensation 3,140 3,517 6,914 6,741
Restructuring charges 2,841 -- 2,841 --
-------- -------- -------- --------
Total costs and expenses 21,218 14,953 42,107 24,261
-------- -------- -------- --------
Loss from operations (14,749) (11,497) (28,331) (19,144)
Interest and other
income, net 821 495 1,595 712
-------- -------- -------- --------
Net loss $(13,928) $(11,002) $(26,736) $(18,432)
======== ======== ======== ========
Net loss per share data:
Basic and diluted $ (0.43) $ (1.69) $ (0.85) $ (3.02)
======== ======== ======== ========
Pro forma basic and diluted $ (0.43) $ (0.50) $ (0.85) $ (0.92)
======== ======== ======== ========
Shares used in calculation
of net loss per share:
Basic and diluted 32,214 6,491 31,580 6,097
Pro forma basic and
diluted (1) 32,214 22,017 31,580 20,030
Supplemental data:
Adjusted loss applicable
to common shareholders
excluding in-process
research and development
and amortization of goodwill,
intangible assets and
deferred stock compensation,
and restructuring charges (7,947) (6,885) (16,981) (11,091)
Adjusted pro forma basic
and diluted net loss
per share $ (0.25) $ (0.31) $ (0.54) $ (0.55)
Shares used in per share
computation - pro forma
basic and diluted (1) 32,214 22,017 31,580 20,030
Note: (1) Pro forma results assumes the conversion of preferred
stock into an equivalent number of common stock at time of issuance
AvantGo, Inc.
Consolidated Balance Sheets
(In thousands)
June 30, December 31,
2001 2000
------ -----
ASSETS
Current assets:
Cash and cash equivalents $ 57,461 $ 57,034
Short-term investments -- 16,432
Accounts receivable, net of allowance 4,820 4,724
Prepaid expenses and other assets 1,136 1,186
--------- ---------
Total current assets 63,417 79,376
Restricted cash 3,438 3,438
Property and equipment, net 8,656 7,998
Goodwill and other intangibles 10,173 12,803
Other assets 579 693
--------- ---------
Total assets $ 86,263 $ 104,308
========= =========
LIABILITIES AND EQUITY
Current liabilities:
Accounts payable and accrued
liabilities $ 1,586 $ 3,167
Accrued liabilities 3,070 1,587
Accrued compensation and related
benefits 2,786 2,238
Current portion of long-term debt -- 40
Deferred revenue 4,551 2,442
--------- ---------
Total current liabilities 11,993 9,474
Deferred revenue, net of current portion -- 83
Accrued restructuring charges,
net of current portion 1,340 --
Stockholders' Equity:
Common stock 168,281 170,841
Notes receivable from stockholders (502) (706)
Deferred stock compensation (5,531) (12,350)
Revenue offset relating to warrant
agreements (845) (1,099)
Accumulated deficit (88,683) (61,947)
Accumulated other comprehensive loss 210 12
--------- ---------
Total stockholders' equity 72,930 94,751
--------- ---------
Total liabilities and stockholders'
equity $ 86,263 $ 104,308
========= =========
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