MOUNTAIN VIEW, Calif., July 18, 2002 - MIPS Technologies, Inc., (NASDAQ: MIPS, MIPSB) a leading provider of industry standard processor architectures and cores for digital consumer and business applications, today reported financial results for its fourth quarter and fiscal year ended June 30, 2002.
Revenue for the fourth quarter of fiscal 2002 was $10.5 million, a 40 percent decline compared to $17.6 million for the same quarter a year ago. Revenue excluding revenue from Nintendo 64 video game products declined by 25 percent compared to the same quarter a year ago. Contract revenue was $7.3 million, a decrease of 26 percent compared to $9.9 million in the comparable period in fiscal 2001. Royalties were $3.2 million, a decrease of 58 percent compared to $7.7 million in the same quarter a year ago primarily due to lower royalties from Nintendo 64 video game products. Royalties excluding royalties from Nintendo 64 were $2.9 million, a decrease of 24 percent compared to $3.8 million in the same quarter a year ago.
Net loss for the fourth quarter of fiscal 2002 was $3.3 million compared to a net income of $2.0 million for the same quarter a year ago. The diluted net loss per share for the fourth quarter of fiscal 2002 was $0.08 compared to a diluted net income per share of $0.05 for the same quarter a year ago.
"Reflecting continued weakness within the semiconductor industry, our customers continued to opt for lower up-front per-use licensing fee deals rather than the higher up-front unlimited use fee licenses which were more frequently selected prior to the downturn," said Casey Eichler, chief financial officer. "However, we were encouraged by the continued high level of deal activity as reflected by eight new license agreements completed during the fourth quarter, which matched last quarter's number. We continue to manage our spending levels in light of the current conditions."
Total revenue for fiscal year 2002 was $47.8 million, a decrease of 44 percent compared to revenue of $84.9 million in fiscal 2001. Total revenue for fiscal year 2002 excluding royalties from Nintendo was $43.5 million, a decline of 25 percent compared to $57.8 million in fiscal 2001. Contract revenue was $31.0 million, a decline of 28 percent compared to contract revenue of $43.0 million in 2001 and accounted for 65 percent of total revenue for fiscal 2002 compared to 51 percent in fiscal 2002. Net loss for fiscal 2002 was $9.4 million compared to net income of $19.1 million in fiscal 2001. Fiscal 2002 diluted net loss per share was $0.24 compared to diluted net income of $0.47 in fiscal 2001.
"We are clearly disappointed at our financial results. However, our company showed many strong signs of progress, including completing agreements with several of the world's leading OEM and semiconductor companies," said John Bourgoin, chairman and CEO. "Furthermore, we continued to bolster our ability to enable customers to get to market quickly with existing and new MIPS-based products. The acquisition of Algorithmics, a GNU tool chain vendor, complements our alliances with companies such as Green Hills Software, Microsoft, Wind River Systems and others."
MIPS invites you to listen to management's discussion of Q4 and fiscal 2002 results and guidance for fiscal 2003 in a conference call live beginning at 1:45 p.m. Pacific DT. Conference call number is (719) 457-2634. Replay number is (719) 457-0820 and will be available for 5 days, beginning shortly after the end of the conference call. The access code is 280681.
Q4 2002 Highlights: Following are selected press release headlines from MIPS Technologies, and the company's licensees, systems vendors and third party providers.
MIPS Technologies, Inc.
MIPS Technologies, Inc. is a leading provider of industry standard processor architectures and cores for digital consumer and business applications. The company drives the broadest architectural alliance that is delivering 32- and 64-bit embedded RISC solutions. The company licenses its intellectual property to semiconductor companies, ASIC developers, and system OEMs. MIPS Technologies, Inc. and its licensees offer the widest range of robust, scalable processors in standard, custom, semi-custom and application-specific products. MIPS Technologies, Inc. is based in Mountain View, California, and can be reached at 650-567-5000 or www.mips.com.
This press release contains forward-looking statements regarding future events or the future financial performance of MIPS Technologies, Inc. Actual events or results may differ materially. Many factors could cause the actual results to differ materially from those contained in such forward-looking statements, including but not limited to: that products will fail to achieve market acceptance, increases in our research and development expenses, the anticipated benefits of our partnering relationships may be more difficult to achieve than expected, the timing of or delays in customer orders, delays in the design process, the length of MIPS Technologies' sales cycle, MIPS Technologies' ability to develop, introduce and market new products and product enhancements, and the level of demand for semiconductors and end-user products that incorporate semiconductors. With respect to MIPS Technologies, we refer you to the documents that it files from time to time with the Securities and Exchange Commission, including its Annual Report on Form 10-K for the year ended June 30, 2001 and subsequent Forms 10-Q and 8-K.
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MIPS® is a registered trademark in the United States and other countries, and MIPS-basedâ„¢ is a trademark of MIPS Technologies, Inc.
| MIPS TECHNOLOGIES, INC. | ||||||
| CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||
| (In thousands, except per share data)
| ||||||
| Three Months Ended June 30, | Twelve Months Ended June 30, | |||||
| 2002 | 2001 | 2002 | 2001 | |||
| Revenue: | ||||||
| Royalties | $3,211 | $7,727 | $16,791 | $41,931 | ||
| Contract revenue | 7,335 | 9,896 | 30,970 | 42,978 | ||
| Total revenue | 10,546 | 17,623 | 47,761 | 84,909 | ||
| Costs and expenses: | ||||||
| Cost of contract revenue | - | - | 250 | 250 | ||
| Research and development | 8,730 | 9,035 | 34,045 | 33,902 | ||
| Sales and marketing | 3,920 | 4,419 | 17,189 | 15,833 | ||
| General and administrative | 1,928 | 2,206 | 7,435 | 9,007 | ||
| Aquired in process research and development | - | - | 1,737 | - | ||
| Restructuring | - | - | 437 | - | ||
| Total costs and expenses | 14,578 | 15,660 | 61,093 | 58,992 | ||
| Operating income (loss) | (4,032) | 1,963 | (13,332) | 25,917 | ||
| Other income (expense), net | 614 | 1,403 | 3,028 | 6,287 | ||
| Income (loss) before income taxes | (3,418) | 3,366 | (10,304) | 32,204 | ||
| Provision (benefit) for income taxes | (134) | 1,356 | (914) | 12,401 | ||
| Income (loss) before cumulative effect of change in accounting principle | (3,284) | 2,010 | (9,390) | 19,803 | ||
| Cumulative effect of change in accounting principal, net of tax benefit | - | - | - | (741) | ||
| Net income (loss) | $(3,284) | $2,010 | $(9,390) | $19,062 | ||
| Per diluted share amounts: | ||||||
| Income (loss) before cumulative effect of change in accounting principle | $(0.08) | $0.05 | $(0.24) | $0.49 | ||
| Cumulative effect of change in accounting principle | - | - | - | (0.02) | ||
| Net income (loss) | $ (0.08) | $ 0.05 | $ (0.24) | $ 0.47 | ||
| Common shares outstanding-diluted | 39,144 | 39,484 | 39,013 | 40,309 | ||
| MIPS TECHNOLOGIES, INC. | ||||
| CONDENSED CONSOLIDATED BALANCE SHEETS | ||||
| (In thousands) | ||||
| June 30, 2002 | June 30, 2001 | |||
| Assets | ||||
| Current assets: | ||||
| Cash and cash equivalents | $90,712 | $116,520 | ||
| Short-term investments | 5,000 | - | ||
| Accounts receivable | 6,046 | 6,443 | ||
| Prepaid expenses and other current assets | 9,883 | 7,720 | ||
| Total current assets | 111,641 | 130,683 | ||
| Equipment and furniture, net | 7,481 | 8,089 | ||
| Other assets | 9,866 | 1,661 | ||
| $128,988 | $140,433 | |||
| Liabilities and Stockholders' Equity | ||||
| Current liabilities: | ||||
| Accounts payable | $1,203 | $3,184 | ||
| Accrued liabilities | 8,979 | 10,472 | ||
| Deferred revenue | 2,911 | 4,069 | ||
| Total current liabilities | 13,093 | 17,725 | ||
| Stockholders' equity | 115,895 | 122,708 | ||
| $128,988 | $140,433 | |||