Update: Intellectual Ventures has acquired Transmeta Patent Portfolio on Jan. 28, 2009
SANTA CLARA, CA. – Aug. 6, 2007 – Transmeta Corporation today announced financial results for the second quarter of fiscal 2007, ended June 30, 2007.
Revenue for the second quarter of 2007 was $171,000, which included $146,000 of service revenue and $25,000 of end-of-life product revenue. This compared with revenue of $2.1 million in the first quarter of 2007, which included $2.0 million of service revenue and $140,000 of end-of-life product revenue. Net loss for the second quarter of 2007 was $11.5 million, or a loss of $0.06 per share, compared with a net loss of $18.7 million, or a loss of $0.09 per share, in the first quarter of 2007. The second quarter of 2007 results included restructuring charges totaling $1.9 million, non-cash charges of $1.7 million for amortization of intangible assets and $693,000 for stock-based compensation expenses.
Gross margin for the second quarter of 2007 was 53 percent, compared with a gross margin of 26 percent in the first quarter of 2007. The sequential increase in gross margin is primarily due to two items: the first quarter 2007 included a one-time $364,000 impairment charge, and the second quarter revenue included higher margin product revenue from inventories that were previously written-off and fully reserved.
The Company's cash, cash equivalents and short term investments at June 30, 2007 totaled $15.3 million. The Company continues to be debt free. Cash at June 30, 2007 does not include the approximate $7.0 million in net proceeds that Transmeta received from AMD's investment in the Company in July 2007.
"In the first half of 2007 we made significant progress to reduce our spending by streamlining our operations to focus on developing and licensing our technologies and intellectual property," said Les Crudele, president and CEO. "In addition, we continue to focus our efforts on strengthening our balance sheet, which was recently improved by the strategic investment by AMD. We are pleased with AMD's investment in the future of Transmeta, and we will continue to explore additional opportunities to finance our operations.
"The progress we have made enables us to now bring even greater focus on developing our technology, building our licensing business and expanding our customer base. We continue to have a number of LongRun2 licensing opportunities in various stages of discussion and are pleased that our first royalty licensee, NEC Electronics, expects to move to volume production of its M2 mobile phone chip in the fourth quarter of this year," said Mr. Crudele.
2007 Annual Meeting Results
Transmeta Corporation held its Annual Meeting of Stockholders on Monday, July 31, 2007 as scheduled. A quorum of stockholders was present in person or by proxy. During the meeting, the motion to elect Messrs. Barnes and Goldman as members in Class I of the Board of Directors of the Company was approved. In addition, the proposal submitted to the stockholders, allowing the Company's Board of Directors to effectuate a reverse stock split at any time prior to July 31, 2008 was approved. There were also sufficient votes to ratify the appointment of Burr, Pilger & Mayer as the Company's independent registered public accounting firm for the fiscal year ending December 31, 2007. A complete tally of the votes on each of these measures will be published in the Company's next regular report on Form 10-Q for the quarterly period ending September 30, 2007, which is expected to be filed with the Securities and Exchange Commission in November 2007.
As previously announced, Transmeta's management will host a conference call today at 5:00 p.m. Eastern time / 2:00 p.m. Pacific time to discuss the operating performance for the quarter. The conference call will be available live over the Internet at the investor relations section of Transmeta's website at www.transmeta.com. To listen to the conference call, please dial (913) 981-4910. A recording of the conference call will be available for one week, starting one hour after the completion of the call, until 11:59 p.m. Pacific time on August 12, 2007. The phone number to access the recording is (888) 203-1112, and the passcode is 6927401. For callers outside the U.S., please dial (719) 457-0820, with the same passcode.
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About Transmeta Corporation
Transmeta Corporation develops and licenses innovative computing, microprocessor and semiconductor technologies and related intellectual property. Founded in 1995, we first became known for designing, developing and selling our highly efficient x86-compatible software-based microprocessors, which deliver a balance of low power consumption, high performance, low cost and small size suited for diverse computing platforms. We are presently focused on developing and licensing our advanced power management technologies for controlling leakage and increasing power efficiency in semiconductor and computing devices, and in licensing our computing and microprocessor technologies to other companies. To learn more about Transmeta, visit www.transmeta.com.