Conexant Second-Quarter Revenues Up 58 Percent Year-Over-Year.Business Editors and High-Tech high-tech also hi-tech adj. Informal Of, relating to, or resembling high technology. high-tech Adjective same as hi-tech Adj. 1. Writers NEWPORT BEACH Newport Beach, residential and resort city (1990 pop. 66,643), Orange co., S Calif., on Newport Bay and the Pacific Ocean; inc. 1906. It is a popular seaside resort and yachting center. Manufactures include electrical and medical equipment, computers, boats, and adhesives. , Calif.--(BUSINESS WIRE)--April 19, 2000 Expansion Platforms Revenue up Nearly 100 Percent; 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 Income Increases 430 Percent Over Second Quarter Fiscal 1999 Conexant Please wikify (format) this article or section as suggested in the Guide to layout and the Manual of Style. Remove this template after wikifying. This article has been tagged since September 2007. Systems Inc. (Nasdaq:CNXT) Wednesday announced revenues of $501.7 million for its second fiscal quarter ended March 31, 2000, up 58 percent over second-quarter fiscal 1999 revenues of $316.9 million, and down slightly from first-quarter fiscal 2000 revenues of $510.0 million. Pro forma net income for the quarter was $47.1 million, or $0.21 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 with pro forma net income of $8.9 million in the second quarter of fiscal 1999, or $0.05 per diluted share. Pro forma net income in the first quarter of 2000 was $53.3 million, or $0.24 per diluted share. These results exclude amortization of intangible assets Intangible Asset An asset that is not physical in nature. Notes: Examples are things like copyrights, patents, intellectual property, and goodwill. These are the opposite of tangible assets. and special charges related to the acquisitions of Maker Communications, Microcosm mi·cro·cosm n. A small, representative system having analogies to a larger system in constitution, configuration, or development: "He sees the auto industry as a microcosm of the U.S. Communications and the broadband wireless See wireless broadband. unit of Oak Technology. "Stronger than anticipated demand in several of our fastest-growing segments contributed to our outstanding second-quarter results," said Dwight W. Decker, Conexant chairman and chief executive officer. "Two of our divisions, network access and digital infotainment (INFOrmation enterTAINMENT) Refers to all the information and entertainment services delivered to the home, which are essentially telephone, TV and Internet access. , set quarterly revenue records. In the aggregate, our expansion platform divisions grew almost 100 percent year-over-year. Areas of strength included digital cellular power amplifiers Power amplifier The final stage in multistage amplifiers, such as audio amplifiers and radio transmitters, designed to deliver appreciable power to the load. , high-speed networking devices and digital satellite set-top box The cable TV box that sits on "top" of the TV "set," although it is often located several feet away in an equipment rack. The set-top box descrambles the premium channels and provides a tuner for the higher cable numbers that very old TVs did not support. receivers." The Network Access Division achieved record revenues of $125.2 million, up 166 percent year-over-year, reflecting strong across-the-board demand for wide-area network (WAN) transport, multi-service access and broadband access See broadband and wireless broadband. solutions. Results were driven by the continuing upgrade of the global network infrastructure to support the dramatic increase in Internet traffic Internet traffic is the flow of data around the Internet. It includes web traffic, which is the amount of that data that is related to the World Wide Web, along with the traffic from other major uses of the Internet, such as electronic mail and peer-to-peer networks. . The Wireless Communications wireless communications System using radio-frequency, infrared, microwave, or other types of electromagnetic or acoustic waves in place of wires, cables, or fibre optics to transmit signals or data. Division recorded revenues of $96.0 million, up 68 percent year-over-year, as the division continued to benefit from worldwide end-market growth of digital cellular handsets. The Digital Infotainment Division generated record revenues of $73.1 million, up 72 percent year-over-year, driven by strong demand for video processing Video processing techniques are used in video codecs, video players and other devices. For example—commonly only design and video processing is different in TV sets of different manufactures. solutions and satellite tuners and demodulators. The Personal Imaging Division recorded revenues of $28.1 million, up 36 percent year-over-year, as leading office-equipment suppliers continued to rely on Conexant for fax modems fax modem n. A modem that sends and receives fax transmissions. and facsimile engines for multi-function peripheral solutions. The Personal Computing Refers to users working on their own computers rather than a terminal to a mainframe. Sometimes, the term refers to using computers at home for work and/or entertainment in contrast to business use only. See personal computer. Division delivered revenues of $179.3 million, up 20 percent year-over-year. Demand for PC dial-up modems remained solid throughout the quarter, with shipments of 15 million units, up more than 50 percent year-over-year. The division also shipped a record 2 million embedded Inserted into. See embedded system. modems. "Based on current design-win activity and order visibility, we expect our expansion platforms to grow approximately 10 percent sequentially this quarter, with a significant contribution from our wireless and networking businesses. Personal computing revenues should rise modestly," Decker continued. "In the aggregate, we anticipate top-line growth to be in the range of 6-8 percent. Gross margins should remain at about the current 46-percent level, and we anticipate that 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. will decline slightly as a percent of sales. We expect research and development spending to increase in line with sales growth as we continue to invest in high growth market segments, particularly in the areas of 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 infrastructure, wireless communications and broadband access. Selling, general and administrative expenses should increase at approximately half the gross-rate of revenues. "We expect to deliver sequential growth in operating profit Operating profit (or loss) Revenue from a firm's regular activities less costs and expenses and before income deductions. operating profit See operating income. of greater than 10 percent this quarter. For the full fiscal year, we are raising our revenue outlook by $100 million, from $2 billion to $2.1 billion, which would deliver growth of almost 50 percent over fiscal 1999," Decker concluded. Second-Quarter Product Highlights -- The Network Access Division expanded its fiber-optic networking family with solutions used both at the edge and core of today's rapidly expanding Internet and telephony Meaning "sound over distance," it refers to electronically transmitting the human voice. In the beginning, telephony dealt only with analog signals in the circuit-switched networks of the telephone companies. infrastructure. This included 10 gigabit-per-second (Gbps) amplifiers, transceivers and drivers for fiber-optic modules, a 3.2 Gbps crosspoint switch Also known as a crossbar or NxN switch, it is a switching device that provides for a fixed number of inputs and outputs. For example, a 32x32 switch is able to keep 32 nodes communicating at full speed to 32 other nodes. and companion re-timing circuit for high-speed networks, and a family of 2.5 Gbps solutions aimed at high-volume data communications data communications, application of telecommunications technology to the problem of transmitting data, especially to, from, or between computers. In popular usage, it is said that data communications make it possible for one computer to "talk" with another. traffic aggregation applications. -- The Wireless Communications Division announced an advanced power-management technology that will significantly improve power amplifier efficiency. The division also introduced a family of radio frequency (RF) subsystems that provide code division multiple access (CDMA (Code Division Multiple Access) A method for transmitting simultaneous signals over a shared portion of the spectrum. The foremost application of CDMA is the digital cellular phone technology from QUALCOMM that operates in the 800 MHz band and 1.9 GHz PCS band. ) phone manufacturers with an easy migration path to the emerging third-generation cdma2000 wireless standard. During the quarter, Conexant received a "Best Supplier Award" from Samsung Electronics' Wireless Terminal Division. The annual award acknowledges the special efforts and importance of companies that supply Samsung with key solutions. -- The Digital Infotainment Division delivered record shipments of its PCI (1) (Payment Card Industry) See PCI DSS. (2) (Peripheral Component Interconnect) The most widely used I/O bus (peripheral bus). and side-port video decoders for "TV in the PC" applications. -- The Personal Imaging Division captured numerous design wins based on its 14.4 Kbps, single-chip fax engine. This highly integrated solution includes telephone answering machine, speakerphone speak·er·phone n. A telephone or telephone attachment that contains both a loudspeaker and a microphone, allowing several persons to participate in a call at the same time without the telephone receiver being held. Noun 1. and caller ID A telephone company service that sends the caller's telephone number between the first and second ring of the call. If the calling number is not blocked, the calling number is displayed on the handset or base station of the called party. functionality. -- The Personal Computing Division introduced SmartSCM(TM), the industry's first single-chip modem solution to include all of the functions necessary for quickly and inexpensively in·ex·pen·sive adj. Not high in price; cheap. in  ex·pen sive·ly adv.
incorporating global Internet connectivity into a broad range of Internet appliances Also called "information appliance," "smart appliance," and "Web appliance," it is a device specialized for accessing the Web and/or e-mail. Designed for ease of use, it plugs into a telephone jack or LAN connection for Internet hookup. such as game consoles See video game console. and "smart" handheld devices. Recent Strategic Initiatives -- After the close of the quarter, the company announced that it has agreed to acquire Philsar Semiconductor Inc. of Ottawa, Canada. Philsar is a privately held, leading developer of RF semiconductor solutions for personal wireless connectivity, including emerging standards such as Bluetooth, and RF components for 3G digital cellular handsets. Philsar will become a part of Conexant's Wireless Communications Division when the transaction is completed this quarter. -- Conexant acquired Applied Telecom Inc., of Lisle lisle n. 1. A fine, smooth, tightly twisted thread spun from long-stapled cotton. 2. Fabric knitted of this thread, used especially for hosiery and underwear. , Ill., also after the close of the quarter. Applied Telecom, a leading supplier of telecommunications Communicating information, including data, text, pictures, voice and video over long distance. See communications. software and hardware products to top networking equipment companies, is now a part of Conexant's Network Access Division. Safe Harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. Statement This news release contains statements relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc future results of the company (including certain projections and business trends) that are "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 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. Actual results may differ materially from those projected as a result of certain risks and uncertainties. These risks and uncertainties include, but are not limited to: global and market conditions, including, but not limited to, the cyclical cyclical Of or relating to a variable, such as housing starts, car sales, or the price of a certain stock, that is subject to regular or irregular up-and-down movements. nature of the semiconductor industry and the markets addressed by the company's and its customers' products; demand for and market acceptance of new and existing products; successful development of new products; the timing of new product introductions; the availability and extent of utilization of manufacturing capacity; pricing pressures and other competitive factors; changes in product mix; fluctuations in manufacturing yields; product obsolescence ob·so·les·cent adj. 1. Being in the process of passing out of use or usefulness; becoming obsolete. 2. Biology Gradually disappearing; imperfectly or only slightly developed. ; the ability to develop and implement new technologies and to obtain protection for the related intellectual property; the successful implementation of the company's diversification Diversification A risk management technique that mixes a wide variety of investments within a portfolio. It is designed to minimize the impact of any one security on overall portfolio performance. Notes: Diversification is possibly the greatest way to reduce the risk. strategy; labor relations of the company, its customers and suppliers; and the uncertainties of litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. , as well as other risks and uncertainties, including, but not limited to, those detailed from time to time in the company's Securities and Exchange Commission filings. These forward-looking statements are made only as of the date hereof here·of adv. Of this. hereof Adverb Formal or law of or concerning this Adv. 1. hereof - of or concerning this; "the twigs hereof are physic" , and the company undertakes no obligation to update or revise the forward-looking statements, whether as a result of new information, future events or otherwise. Other brands and names contained in this release are the property of their respective owners. About Conexant With a revenue run-rate of approximately $2 billion per year, Conexant is the world's largest independent company focused exclusively on providing semiconductor solutions for communications electronics. With more than 30 years of experience in developing communications technology Noun 1. communications technology - the activity of designing and constructing and maintaining communication systems engineering, technology - the practical application of science to commerce or industry , the company draws upon its expertise in mixed-signal processing to deliver integrated systems and semiconductor products for a broad range of communications applications. These products facilitate communications worldwide through wireline voice and data communications networks, cordless cord·less adj. Having no cord, usually using batteries as a source of power: a cordless telephone. cord and cellular wireless telephony telephony without wires, usually employing electric waves of high frequency emitted from an oscillator or generator, as in wireless telegraphy. A telephone transmitter causes fluctuations in these waves, it being the fluctuations only which affect the receiver. See also: Wireless systems, personal imaging devices and equipment, and emerging cable and wireless broadband High-speed wireless transmission of data. What is "high" speed is always a changing number. Wireless systems are typically slower than land-based, wireline networks. In the past, wireless broadband started at 250 Kbps, whereas land-based broadband was generally considered to start at T1 communications networks The transmission channels interconnecting all client and server stations as well as all supporting hardware and software. . The company aligns its business into five product platforms: Network Access, Wireless Communications, Digital Infotainment, Personal Imaging and Personal Computing. Conexant is a member of the S&P 500 and Nasdaq-100 Indices. For more information, visit Conexant at www.conexant.com. Note to Editors, Analysts and Investors: The Conexant Q2 FY00 conference call will take place on Wednesday, April 19, 2000, at 2 p.m. PDT PDT abbr. Pacific Daylight Time PDT Pacific Daylight Time PDT n abbr (US) (= Pacific Daylight Time) → hora de verano del Pacífico PDT , 5 p.m. EDT EDT abbr. Eastern Daylight Time EDT Eastern Daylight Time EDT n abbr (US) (= Eastern Daylight Time) → hora de verano de Nueva York EDT . To listen to the conference call via phone, please call 800/680-9685 (domestic) or 334/260-0508 (international), security code: Conexant. To listen via the Internet, visit www.StreetEvents.com, www.StreetFusion.com or www.vcall.com. Playback Playback could mean:
CONEXANT SYSTEMS INC.
Pro Forma Consolidated Condensed Statements of Operations
(unaudited, in thousands, except per-share amounts)
Three Months Ended Six Months Ended
March 31, March 31,
2000 1999 2000 1999
Net revenues $ 501,728 $ 316,932 $ 1,011,691 $ 611,610
Cost of goods
sold 269,459 186,677 546,905 403,431
Gross margin 232,269 130,255 464,786 208,179
Operating expenses:
Research and
development 100,095 68,802 188,572 139,911
Selling, general
and
administrative 66,024 48,527 134,192 112,543
Total
operating
expenses 166,119 117,329 322,764 252,454
Operating income
(loss) 66,150 12,926 142,022 (44,275)
Other income, net 932 17 1,510 (126)
Income (loss) before
provision (benefit)
for income taxes 67,082 12,943 143,532 (44,401)
Provision (benefit)
for income taxes 19,939 4,056 43,071 (20,767)
Pro forma net income
(loss) $ 47,143 $ 8,887 $ 100,461 $ (23,634)
Pro forma net income
(loss) per share:
Basic $ 0.23 $ 0.05 $ 0.50 $ (0.12)
Diluted $ 0.21 $ 0.05 $ 0.45 $ (0.12)
Number of shares used in
per-share computation:
Basic 205,207 189,958 200,962 189,914
Diluted 239,644 195,464 234,549 189,914
The Pro Forma Consolidated Condensed Statement of Operations presented
above (which excludes amortization of intangible assets and special
charges) is not in accordance with generally accepted accounting
principles. A reconciliation of the pro forma net income (loss)
presented above with the company's net income (loss) as determined
under generally accepted accounting principles is presented on the
following page.
CONEXANT SYSTEMS INC.
Reconciliation of Pro Forma Net Income to Reported Results
(unaudited, in thousands, except per-share amounts)
Three Months Ended Six Months Ended
March 31, March 31,
2000 1999 2000 1999
Pro forma net income
(loss)(1) $ 47,143 $ 8,887 $ 100,461 $ (23,634)
Amortization of intangibles
and special items:
Amortization of
intangibles 25,337 2,063 27,742 4,127
Purchased in-process
research and
development 145,900 -- 145,900 --
Special charges -
Rockwell-retained
assets -- -- -- 20,000
Special charges
- other -- -- -- 17,906
Tax benefit (2,835) (793) (3,753) (16,161)
Impact of higher
effective tax rate
resulting from
non-deductible
amortization 11,083 -- 11,083 --
Net income
(loss) $ (132,342) $ 7,617 $ (80,511) $ (49,506)
Basic net income
(loss) per share:
Pro forma net income
(loss) $ 0.23 $ 0.05 $ 0.50 $ (0.12)
Amortization of
intangibles and
special items (0.87) (0.01) (0.90) (0.14)
Net income
(loss) $ (0.64) $ 0.04 $ (0.40) $ (0.26)
Diluted net income
(loss) per share:
Pro forma net
income
(loss) (2) $ 0.21 $ 0.05 $ 0.45 $ (0.12)
Amortization of
intangibles and
special items (0.85) (0.01) (0.85) (0.14)
Net income
(loss) $ (0.64) $ 0.04 $ (0.40) $ (0.26)
(1) Pro forma net income presents the company's operating results,
excluding amortization of intangible assets and special charges.
Special charges excluded from the three months and six months ended
March 31, 2000, consist of purchased in-process research and
development of $145.9 million. Special charges excluded from the six
months ended March 31, 1999, consist of a $20 million asset impairment
charge for the Colorado Springs wafer fabrication facility and
additional special charges of $18 million related to other
restructuring actions. The pro forma statements have also been
adjusted for the income tax effect of the above items using the
company's marginal tax rate for the periods presented and, in fiscal
2000, for the impact of the higher effective tax rate resulting from
non-deductible amortization.
(2) The computation of pro forma diluted earnings per share includes
the effect of stock options, restricted stock and the 4-1/4%
convertible subordinated notes. Earnings are adjusted to exclude
interest expense on the notes (net of related tax benefits) of $2.3
million and $4.6 million for the quarter and six months ended March
31, 2000. Pro forma diluted weighted-average shares outstanding
include the dilutive effect of stock options and approximately 15.2
million shares issuable on the assumed conversion of the notes. The 4%
convertible subordinated notes are excluded from the computation of
earnings per share as they are antidilutive.
CONEXANT SYSTEMS INC.
Consolidated Condensed Statements of Operations
(unaudited, in thousands, except per-share amounts)
Three Months Ended Six Months Ended
March 31, March 31,
2000 1999 2000 1999
Net revenues $ 501,728 $ 316,932 $ 1,011,691 $ 611,610
Cost of goods
sold 269,459 186,677 546,905 403,431
Gross margin 232,269 130,255 464,786 208,179
Operating expenses:
Research and
development 100,095 68,802 188,572 139,911
Selling, general
and
administrative 66,024 48,527 134,192 112,543
Amortization of
intangibles 25,337 2,063 27,742 4,127
Purchased in-process
research and
development 145,900 -- 145,900 --
Special charges -
Rockwell-retained
assets -- -- -- 20,000
Special charges -
other -- -- -- 17,906
17,906
Total
operating
expenses 337,356 119,392 496,406 294,487
Operating income
(loss) (105,087) 10,863 (31,620) (86,308)
Other income, net 932 17 1,510 (126)
Income (loss) before
provision (benefit)
for income
taxes (104,155) 10,880 (30,110) (86,434)
Provision (benefit)
for income taxes 28,187 3,263 50,401 (36,928)
Net income
(loss) $ (132,342) $ 7,617 $ (80,511) $ (49,506)
Net income (loss) per
share:
Basic $ (0.64) $ 0.04 $ (0.40) $ (0.26)
Diluted $ (0.64) $ 0.04 $ (0.40) $ (0.26)
Number of shares used
in per-share computation:
Basic 205,207 189,958 200,962 189,914
Diluted 205,207 195,464 200,962 189,914
CONEXANT SYSTEMS INC.
Consolidated Condensed Balance Sheets
(unaudited, in thousands)
March 31, Sept. 30,
2000 1999
ASSETS
Current assets:
Cash and cash equivalents $ 930,892 $ 398,516
Receivables, net 295,864 238,940
Inventories, net 261,703 224,477
Deferred income taxes 132,299 81,860
Other current assets 83,334 35,381
Total current assets 1,704,092 979,174
Marketable securities 159,064 --
Property, plant and equipment, net 787,299 723,013
Intangible assets, net 1,034,217 47,824
Other assets 159,574 91,939
Total assets $ 3,844,246 $ 1,841,950
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 189,577 $ 265,151
Deferred revenue 34,564 21,027
Accrued compensation and benefits 77,936 48,530
Other current liabilities 37,422 40,013
Total current liabilities 339,499 374,721
Convertible subordinated notes 1,000,000 350,000
Other long-term liabilities 77,819 82,076
Deferred income taxes 72,786 --
Total liabilities 1,490,104 806,797
Commitments and contingencies -- --
Shareholders' equity:
Preferred and junior preferred stock -- --
Common stock 216,932 196,387
Additional paid-in capital 2,072,173 769,563
Retained earnings (10,459) 70,052
Accumulated other comprehensive income 79,807 149
Treasury stock, at cost (1,122) --
Unearned compensation (3,189) (998)
Total shareholders' equity 2,354,142 1,035,153
Total liabilities and shareholders'
equity $ 3,844,246 $ 1,841,950
CONEXANT SYSTEMS INC.
Selected Corporate Data
(unaudited, dollars in thousands)
Three months ended
March 31, 2000 Dec. 31, 1999
% of % of
Revenue Revenue Revenue Revenue
Revenue by Business
Platform
Network Access 25% 125,224 23% 118,547
Wireless
Communications 19% 95,958 20% 103,018
Digital Infotainment 15% 73,140 13% 67,126
Personal Imaging 5% 28,116 6% 31,176
Personal Computing 36% $179,290 38% $190,096
Revenue by Region
Americas 30% $147,734 33% $167,972
Europe 12% 60,841 10% 53,127
Japan 12% 60,892 11% 54,411
Asia-Pacific 46% 232,261 46% 234,453
March 31, 1999
% of
Revenue Revenue
Revenue by Business
Platform
Network Access 15% 47,021
Wireless
Communications 18% 57,099
Digital Infotainment 13% 42,644
Personal Imaging 7% 20,611
Personal Computing 47% $149,557
Revenue by Region
Americas 32% $102,044
Europe 11% 33,794
Japan 13% 41,318
Asia-Pacific 44% 139,776
Three months ended
March 31, Dec. 31, March 31,
Other Data: 2000 1999 1999
Depreciation (1) $48,056 $44,357 $50,360
Capital expenditures 76,218 84,656 18,522
(1) Does not include amortization of intangible assets.
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