Avid Continues Momentum with Strong First Quarter Results.Business Editors TEWKSBURY, Mass.--(BUSINESS WIRE)--April 16, 2003 Avid Technology "Avid" redirects here. For the "Advancement Via Individual Determination" educational program, see AVID. Avid Technology, Inc NASDAQ: AVID is an American company specializing in video and audio production technology; specifically, digital non-linear media editing (NLE) , Inc. (Nasdaq: AVID) today reported strong results for the first quarter ended March 31, 2003. Revenues for the quarter were $112.2 million versus $92 million in the corresponding quarter in 2002. Gross margin for the quarter was 53.4% compared to 48.1% in the first quarter of 2002 reflecting an improved product mix, reduced materials costs and favorable fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. currency exchange rates. The first quarter 2003 gross margin was Avid's highest since the second quarter of 1999. Net income for the quarter was $5.5 million or $.18 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 compared to a net loss of $3.7 million or $.14 per share for the first quarter of 2002. Included in net income for the first quarter of 2003 were charges of $1.2 million for restructuring restructuring - The transformation from one representation form to another at the same relative abstraction level, while preserving the subject system's external behaviour (functionality and semantics). activities and $600,000 related to vacating certain real estate. Avid's cash and marketable securities Marketable Securities Very liquid securities that can be converted into cash quickly at a reasonable price. Notes: Marketable securities are very liquid as they tend to have maturities less than one year, and the rate at which these securities can be bought or sold has increased during the quarter by over $17 million to $106.2 million at March 31, 2003, nearly double the cash balance from the corresponding quarter in 2002. "We're extremely pleased with our results this quarter and the continuation of the momentum we generated throughout 2002," said David Krall, Avid's president and chief executive officer. "In what is typically Avid's slowest quarter, we increased our gross margins, net income and cash balance. This puts Avid in a solid position to further grow our business and improve our profitability as we begin preparations to ship the brand new, revolutionary product line we announced last week at NAB - the National Association of Broadcasters convention in Las Vegas Las Vegas (läs vā`gəs), city (1990 pop. 258,295), seat of Clark co., S Nev.; inc. 1911. It is the largest city in Nevada and the center of one of the fastest-growing urban areas in the United States. ." While exhibiting at NAB from April 7-10, 2003, Avid unveiled the largest array of new products in the history of its core video business. The company introduced an entirely new nonlinear A system in which the output is not a uniform relationship to the input. nonlinear - (Scientific computation) A property of a system whose output is not proportional to its input. architecture that combines host-based software editing applications with hardware-based digital nonlinear accelerators (called Avid DNA DNA: see nucleic acid. DNA or deoxyribonucleic acid One of two types of nucleic acid (the other is RNA); a complex organic compound found in all living cells and many viruses. It is the chemical substance of genes. (TM)) specifically engineered for accelerating media processing See media control. . These next-generation solutions offer dramatically increased performance for Avid customers at the high-, mid-, and low-end of its product range, and include: -- The Avid(R) DS Nitris(TM) family - Avid's most powerful nonlinear systems Noun 1. nonlinear system - a system whose performance cannot be described by equations of the first degree system, scheme - a group of independent but interrelated elements comprising a unified whole; "a vast system of production and distribution and consumption to date, capable of delivering real-time effects for up to two streams of 10-bit high-definition media and eight streams of 10-bit uncompressed standard-definition media. -- Media Composer(R) Adrenaline adrenaline (ədrĕn`əlĭn, –lēn): see epinephrine. (TM) - the fastest, most powerful, compatible and highest-quality Media Composer system ever, designed for time-sensitive production environments and offering unparalleled features, performance and connectivity and the ability to expand to support HD media. -- Avid Xpress(R) Pro with Avid Mojo(TM) - a powerful combination of new nonlinear editing See nonlinear video editing. software and portable Avid DNA hardware for film and video professionals seeking an affordable, mobile solution that offers true real-time editing for DV media and expandability to support uncompressed standard-definition video. Product introductions at NAB were not solely focused on Avid's core postproduction post·pro·duc·tion n. A final stage in the production of a film or a television program, occurring after the action has been filmed or videotaped and typically involving editing and the addition of soundtracks. market. Avid also announced Avid NewsCutter(R) Adrenaline FX and Avid NewsCutter XP with Avid Mojo, two new cutting-edge nonlinear systems for news editing; the Avid Nearchive(TM) system, a first-of-its-kind common media repository that simplifies the process of finding and accessing infrequently in·fre·quent adj. 1. Not occurring regularly; occasional or rare: an infrequent guest. 2. used media that would otherwise be stored on analog tapes in library archives; and the MEDIArray(TM) ZX solution, a high-performance, cost-effective 2.88 TB disk storage subsystem The part of a computer system that provides the storage. It includes the controller and disk drives. See storage system. representing the newest building block in the Avid Unity(TM) MediaNetwork family of shared-storage and media management solutions. Conference Call A conference call to discuss Avid's first quarter 2003 financial results and the company's outlook for the balance of 2003 will be held tomorrow, April 17 at 8:30 a.m. ET. The call will be open to the public. The conference call can be accessed by dialing (913) 981-5518 and referencing confirmation code 461514. The call and subsequent replay will also be available for a limited time on Avid's Web site. To listen via this alternative, go to the investor relations Investor relations The process by which the corporation communicates with its investors. page at www.avid.com for complete details 10-15 minutes prior to the start of the conference call. The above release 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. , as defined by 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 1996, including statements about Avid's financial outlook, products and functionality, and size and growth of existing markets. There are a number of factors that could cause actual events or results of operations to differ materially from those indicated by such forward-looking statements, such as market acceptance of Avid's products, further weakening weak·en tr. & intr.v. weak·ened, weak·en·ing, weak·ens To make or become weak or weaker. weak  en·er n. of worldwide economic conditions and the
other factors set forth under the caption "Certain Factors That May
Affect Future Results" in Avid's Form 10-K Form 10-KA 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, 2002 and other filings with the Securities and Exchange Commission. In addition, any forward-looking statements contained herein represent Avid's estimates only as of today and should not be relied upon as representing the company's estimates as of any subsequent date. While Avid may elect to update forward-looking statements at some point in the future, Avid specifically disclaims any obligation to do so, even if the estimates change. About Avid Technology, Inc. Avid Technology, Inc. delivers the solutions that Make, Manage and Move Media(TM). As a recognized digital standard for professionals who Make the world's media -- from video, audio and film to animation, special effects special effects, in motion pictures, cinematographic techniques that create illusions in the audience's minds as well as the illusions created using these techniques. and streaming media See streaming audio, streaming video and digital media hub. -- Avid's products are used to make more television and news shows, commercials, music videos and CDs, corporate/industrial productions and major motion pictures combined than any other nonlinear editing manufacturer in the world. Building on its award-winning heritage, which includes several Emmy(R) awards as well as an Oscar(R) statuette representing the 1998 Scientific and Technical Award for the concept, design and engineering of the Avid Film Composer(R) systems for motion picture editing, Avid is extending its reach by redefining how digital media is shared, stored and distributed. To Manage today's increasingly rich collection of dynamic media, Avid provides powerful servers, networks and media tools to help customers search files, share media and collaborate on new productions, both locally and globally. Avid's solutions also empower users to easily Move media, whether on air, over cable or satellite or through the Internet. Like no other media company today, Avid's end-to-end solutions (jargon) end-to-end solution - (E2ES) A term that suggests that the supplier of an application program or system will provide all the hardware and/or software components and resouces to meet the customer's requirement and no other supplier need be involved. Compare: turn-key solution. span the continuum of media creation, management and distribution. The company's corporate headquarters are located in Tewksbury, MA. More information about the company is available at www.avid.com. (C) 2003 Avid Technology, Inc. All rights reserved. Adrenaline, Avid, Avid DNA, Avid Mojo, Avid Unity, Avid Xpress, Make, Manage and Move Media, Media Composer, MEDIArray, Nearchive, NewsCutter, Nitris and Film Composer are either registered trademarks or trademarks of Avid Technology, Inc. in 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. and/or other countries. Oscar is Oscar I, 1799–1859, king of Sweden and Norway (1844–59), son and successor of Charles XIV. His reign was one of social and economic advance. His book on the reform of criminal law and prisons had wide influence. Oscar was succeeded by his elder son, Charles XV. a registered trademark and service mark of the Academy of Motion Picture Arts and Sciences. Emmy is a registered trademark of ATAS/NATAS. All other trademarks contained herein are the property of their respective owners.
AVID TECHNOLOGY, INC.
Condensed Consolidated Statements of Operations
(in thousands, except per share data)
Three Months Ended
March 31,
2003 2002
(unaudited) (unaudited)
Net revenues $112,177 $92,009
Cost of revenues 52,227 47,715
Gross profit 59,950 44,294
Operating expenses:
Research and development 21,699 19,818
Marketing and selling 25,264 22,966
General and administrative 5,345 4,513
Restructuring and other costs, net 1,783 -
Amortization of acquisition-related
intangible assets 293 346
Total operating expenses 54,384 47,643
Operating income (loss) 5,566 (3,349)
Interest and other income (expense), net 231 265
Income (loss) before income taxes 5,797 (3,084)
Provision for income taxes 300 600
Net income (loss) $5,497 ($3,684)
Net income (loss) per common share - basic $0.20 ($0.14)
Net income (loss) per common share - diluted $0.18 ($0.14)
Weighted average common shares outstanding -
basic 27,604 26,029
Weighted average common shares outstanding -
diluted 29,860 26,029
AVID TECHNOLOGY, INC.
Condensed Consolidated Balance Sheets
(in thousands)
March 31, December 31,
2003 2002
(unaudited)
ASSETS:
Current assets:
Cash and marketable securities $106,204 $89,034
Accounts receivable, net of allowances of
$10,246 and $10,614 at March 31, 2003 and
December 31, 2002, respectively 68,386 65,942
Inventories 34,870 38,047
Prepaid and other current assets 14,837 11,919
Total current assets 224,297 204,942
Property and equipment, net 24,916 25,731
Acquisition-related intangible assets 2,314 2,600
Other assets 2,598 2,530
Total assets $254,125 $235,803
LIABILITIES AND STOCKHOLDERS' EQUITY:
Current liabilities:
Accounts payable $17,515 $24,297
Accrued expenses and other
current liabilities 51,488 51,032
Deferred revenue 46,809 35,483
Total current liabilities 115,812 110,812
Long term liabilities, less current portion 1,088 1,427
Total stockholders' equity 137,225 123,564
Total liabilities and
stockholders' equity $254,125 $235,803
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