Click here to close now.

SYS-CON MEDIA Authors: Dana Gardner, Elizabeth White, Jnan Dash, Kevin Jackson, Peter Silva

News Feed Item

Smith Micro Software Reports 2014 Second Quarter Financial Results

ALISO VIEJO, CA -- (Marketwired) -- 07/30/14 -- Smith Micro Software, Inc. ("Smith Micro Software") (NASDAQ: SMSI), a leading provider of wireless and mobility solutions, today reported financial results for its second quarter ended June 30, 2014.

"Revenues for the second quarter were $8.5 million, up slightly sequentially from the first quarter, but down 19 percent year-over-year. While we saw an increase in our CommSuite revenues during the quarter, it did not offset decreases in our legacy connection manager products and the seasonal drop-off of our Productivity & Graphics products. We expect revenues to increase in the third quarter based on new orders and continued increases in CommSuite revenue driven by new features and increased advertising revenue," said William W. Smith Jr., President and CEO of Smith Micro Software.

"As we stated in our last earnings release, we took a one-time restructuring charge this quarter of $2.4 million, of which $1.3 million was non-cash stock-based compensation expense. This reduced our overall cost structure by approximately $2.0 million per quarter. We should see a full quarter's benefit from these actions in the third quarter. With this lower cost structure and projected increase in revenues, we should significantly reduce our cash burn and get close to cash neutral in the third quarter, with the goal to return to profitability by the fourth quarter," Mr. Smith concluded.

Smith Micro Software reported revenues of $8.5 million for the second quarter ended June 30, 2014, compared to $10.5 million reported in the second quarter ended June 30, 2013.

Second quarter 2014 gross profit on both a GAAP and non-GAAP basis (which excludes stock compensation) was $6.1 million, compared to $8.1 million reported in the second quarter of 2013.

GAAP gross profit as a percentage of revenue was 71.3 percent for the second quarter of 2014, compared to 77.1 percent for the second quarter of 2013. Non-GAAP gross profit as a percentage of revenue was 71.3 percent for the second quarter of 2014, compared to 77.2 percent for the same quarter last year.

GAAP net loss for the second quarter of 2014 was $5.7 million, or $0.15 loss per diluted share, compared to a GAAP net loss of $7.2 million, or $0.19 loss per diluted share, for the second quarter of 2013.

Non-GAAP net loss (which excludes stock-based compensation and non-cash tax expense) for the second quarter of 2014 was $2.4 million, or $0.06 loss per diluted share, compared to a non-GAAP net loss of $3.8 million, or $0.10 loss per diluted share, for the second quarter of 2013. Excluding the restructuring charge, the non-GAAP net loss for the second quarter of 2014 would have been $1.6 million, or $0.04 loss per diluted share.

For the six months ended June 30, 2014, the Company reported revenues of $17.0 million, compared to $22.1 million for the six months ended June 30, 2013.

GAAP gross profit was $12.1 million for the six months ended June 30, 2014, compared to $17.2 million for the six months ended June 30, 2013. Non-GAAP gross profit (which excludes stock-based compensation) was $12.1 million for the six months ended June 30, 2014, compared to $17.3 million for the same period last year.

GAAP gross profit as a percentage of revenues was 71.3 percent for the six months ended June 30, 2014, compared to 78.1 percent for the same period last year. Non-GAAP gross profit as a percentage of revenues was 71.4 percent for the six months ended June 30, 2014, compared to 78.1 percent for same period last year.

GAAP net loss for the six months ended June 30, 2014 was $10.9 million, or a loss of $0.28 per diluted share, compared to a GAAP net loss for the six months ended June 30, 2013 of $13.4 million, or $0.36 loss per diluted share.

Non-GAAP net loss for the six months ended June 30, 2014 was $5.0 million, or a loss of $0.13 per diluted share, compared to a non-GAAP net loss of $6.9 million, or $0.19 loss per diluted share, for the six months ended June 30, 2013. Excluding the restructuring charge, the non-GAAP net loss for the six months ended June 30, 2014 would have been $4.3 million, or $0.11 loss per diluted share.

Total cash and cash equivalents and short-term investments at June 30, 2014 were $6.3 million.

The Company uses a non-GAAP reconciliation of gross profit, loss before taxes, net loss and loss per share in the presentation of financial results in this press release. Management believes that this presentation may be more meaningful in analyzing our income generation, since stock-based compensation and non-cash tax expense are excluded from the non-GAAP earnings calculation. Since we are in a loss position, the non-GAAP income tax benefit for the period ended June 30, 2014 was computed by using a tax rate of 38 percent using the Company's normalized combined U.S. federal, state and foreign statutory tax rates less various tax adjustments. This presentation may be considered more indicative of our ongoing operational performance. The tables below present the differences between non-GAAP earnings and net loss on an absolute and per-share basis. Non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information presented in compliance with GAAP, and the non-financial measures as reported by Smith Micro Software may not be comparable to similarly titled amounts reported by other companies.

Investor Conference Call:

Smith Micro Software will hold an investor conference call today to discuss the Company's second quarter 2014 results at 4:30 p.m. ET, July 30, 2014. To access the call, dial (888) 503-8175 and when prompted provide the pass code "Smith Micro." Participants are asked to call the assigned number approximately 10 minutes before the conference call begins. In addition, the conference call will be available on the Smith Micro website in the Investor Relations section.

About Smith Micro Software, Inc.:

Smith Micro Software provides solutions that simplify, secure and enhance the mobile experience. Our portfolio includes a wide range of applications that manage broadband connectivity, data traffic, devices, voice and video communications over wireless networks. With 30 years of experience developing world-class client and server software, Smith Micro helps the leading mobile network operators, device manufacturers and enterprises increase efficiency and capitalize on the growth of mobile-connected consumers and workforces. For more information, visit smithmicro.com. (NASDAQ:SMSI)

Safe Harbor Statement:

This release contains forward-looking statements that involve risks and uncertainties, including without limitation, forward-looking statements relating to the company's financial prospects and other projections of its performance, the execution of our recently announced restructuring, our ability to halt the decline of our cash reserves in light of our continued losses, the existence of new market opportunities and interest in the company's products and solutions, and the company's ability to increase its revenue and regain profitability by capitalizing on these new market opportunities and interest and introducing new products and solutions. Among the important factors that could cause actual results to differ materially from those expressed or implied in the forward-looking statements are potential for disruption and loss of customers and business from the transfer of duties and responsibilities in our recently announced restructuring, the risk that we will continue to incur losses and not regain profitability, the risk that we may need to raise additional capital to fund our operations and such capital may not be available to us at commercially reasonable terms or at all, changes in demand for the company's products from its customers and their end-users, customer concentration given that the majority of our sales depend on a few large client relationships, including Sprint, new and changing technologies, customer acceptance and timing of deployment of those technologies, new and continuing adverse economic conditions, and the company's ability to compete effectively with other software companies. These and other factors discussed in the company's filings with the Securities and Exchange Commission, including its filings on Forms 10-K and 10-Q, could cause actual results to differ materially from those expressed or implied in any forward-looking statements. The forward-looking statements contained in this release are made on the basis of the views and assumptions of management regarding future events and business performance as of the date of this release, and the company does not undertake any obligation to update these statements to reflect events or circumstances occurring after the date of this release.

Smith Micro and the Smith Micro logo are registered trademarks or trademarks of Smith Micro Software, Inc. Third-party trademarks mentioned are the property of their respective owners. The use of the word partner does not imply a partnership relationship between Smith Micro and any other company.



Smith Micro Software, Inc.
Reconciliation of GAAP to Non-GAAP Results
(in thousands, except per share amounts) - unaudited

                                                Stock                Non-
                                   GAAP     Compensation   Taxes     GAAP
                               -----------  ------------ --------- --------
Three Months Ended 6/30/14:
  Gross profit                 $     6,077  $          3 $       - $  6,080
  Loss before provision for
   income taxes                $    (5,683) $      1,883 $       - $ (3,800)
  Net loss                     $    (5,695) $      1,883 $   1,456 $ (2,356)
  EPS-diluted                  $     (0.15) $       0.05 $    0.04 $  (0.06)

Three Months Ended 6/30/13:
  Gross profit                 $     8,083  $          6 $       - $  8,089
  Loss before provision for
   income taxes                $    (7,240) $      1,102 $       - $ (6,138)
  Net loss                     $    (7,244) $      1,102 $   2,336 $ (3,806)
  EPS-diluted                  $     (0.19) $       0.03 $    0.06 $  (0.10)

Six Months Ended 6/30/14:
  Gross profit                 $    12,106  $          8 $       - $ 12,114
  Loss before provision for
   income taxes                $   (10,817) $      2,681 $       - $ (8,136)
  Net loss                     $   (10,862) $      2,681 $   3,137 $ (5,044)
  EPS-diluted                  $     (0.28) $       0.07 $    0.08 $  (0.13)

Six Months Ended 6/30/13:
  Gross profit                 $    17,241  $         11 $       - $ 17,252
  Loss before provision for
   income taxes                $   (13,329) $      2,174 $       - $(11,155)
  Net loss                     $   (13,402) $      2,174 $   4,311 $ (6,917)
  EPS-diluted                  $     (0.36) $       0.06 $    0.11 $  (0.19)


Smith Micro Software, Inc.
Statements of Comprehensive Loss for the Three Months and Six Months Ended
 June 30, 2014 and 2013
(in thousands, except per share amounts) - unaudited

                                 For the Three Months   For the Six Months
                                    Ended June 30,        Ended June 30,
                                    2014       2013       2014       2013
                                 ---------  ---------  ---------  ---------
Revenues                         $   8,528  $  10,484  $  16,977  $  22,086
Cost of revenues                     2,451      2,401      4,871      4,845
                                 ---------  ---------  ---------  ---------
Gross profit                         6,077      8,083     12,106     17,241

Operating expenses:
  Selling and marketing              2,296      4,569      5,332      8,950
  Research and development           3,609      5,900      7,858     11,836
  General and administrative         3,418      4,862      7,296      9,804
  Restructuring expense              2,435          -      2,435          -
                                 ---------  ---------  ---------  ---------
Total operating expenses            11,758     15,331     22,921     30,590
                                 ---------  ---------  ---------  ---------
Operating loss                      (5,681)    (7,248)   (10,815)   (13,349)
Interest and other income
 (expense), net                         (2)         8         (2)        20
                                 ---------  ---------  ---------  ---------
Loss before provision for income
 taxes                              (5,683)    (7,240)   (10,817)   (13,329)
                                 ---------  ---------  ---------  ---------
Provision for income tax expense        12          4         45         73
                                 ---------  ---------  ---------  ---------
Net loss                         $  (5,695) $  (7,244) $ (10,862) $ (13,402)
                                 ---------  ---------  ---------  ---------

Other comprehensive income
 (loss), before tax:
  Unrealized holding gains
   (losses) on available-for-
   sale securities                       1        (17)         1          1
  Income tax expense related to
   items of othercomprehensive
   income                                -          -          -          -
                                 ---------  ---------  ---------  ---------
  Other comprehensive income
   (loss), net of tax                    1        (17)         1          1
                                 ---------  ---------  ---------  ---------
Comprehensive loss               $  (5,694) $  (7,261) $ (10,861) $ (13,401)
                                 =========  =========  =========  =========

Loss per share:
  Basic and diluted              $   (0.15) $   (0.19) $   (0.28) $   (0.36)

Weighted average shares
 outstanding:
  Basic and diluted                 38,518     37,247     38,118     36,932


Smith Micro Software, Inc.
Consolidated Balance Sheets
(in thousands)
                                                June 30,      December 31,
                                                  2014            2013
                                             --------------  --------------
                                               (unaudited)      (audited)
ASSETS
Current Assets:
Cash & cash equivalents                      $        5,036  $       11,763
Short term investments                                1,220           3,078
Accounts receivable, net                              7,389           7,563
Income tax receivable                                   702             699
Inventory, net                                          169             167
Prepaid and other assets                              1,438             871
Deferred tax asset                                      152             152
                                             --------------  --------------
  Total current assets                               16,106          24,293
Equipment & improvements, net                         5,373           7,023
Other assets                                            205             222
                                             --------------  --------------
TOTAL ASSETS                                 $       21,684  $       31,538
                                             ==============  ==============

LIABILITIES & STOCKHOLDERS' EQUITY
Current Liabilities:
  Accounts payable                           $        1,378  $        1,632
  Accrued liabilities                                 6,722           7,734
  Deferred revenue                                      119             464
                                             --------------  --------------
    Total current liabilities                         8,219           9,830

Long-term liabilities                                 3,701           3,383
Deferred tax liability                                  154             154
                                             --------------  --------------
    Total non-current liabilities                     3,855           3,537

Stockholders' Equity:
  Common stock                                           38              37
  Additional paid in capital                        216,918         214,619
  Accumulated comprehensive deficit                (207,346)       (196,485)
                                             --------------  --------------
    Total stockholders' equity                        9,610          18,171
                                             --------------  --------------
TOTAL LIABILITIES & STOCKHOLDERS' EQUITY     $       21,684  $       31,538
                                             ==============  ==============

AT THE COMPANY:
Suzanne Runald
Public Relations
949-362-5800
Email Contact

IR INQUIRIES:
Todd Kehrli or Jim Byers
MKR Group
323-468-2300
Email Contact

More Stories By Marketwired .

Copyright © 2009 Marketwired. All rights reserved. All the news releases provided by Marketwired are copyrighted. Any forms of copying other than an individual user's personal reference without express written permission is prohibited. Further distribution of these materials is strictly forbidden, including but not limited to, posting, emailing, faxing, archiving in a public database, redistributing via a computer network or in a printed form.

Latest Stories
SYS-CON Events announced today that BroadSoft, the leading global provider of Unified Communications and Collaboration (UCC) services to operators worldwide, has been named “Gold Sponsor” of SYS-CON's WebRTC Summit, which will take place on June 9-11, 2015, at the Javits Center in New York City, NY. BroadSoft is the leading provider of software and services that enable mobile, fixed-line and cable service providers to offer Unified Communications over their Internet Protocol networks. The Compa...
VoxImplant has announced full WebRTC support in the newest versions of its Android SDK and iOS SDK. The updated SDKs, which enable audio and video calls on mobile devices, are now compatible with the WebRTC standard to allow any mobile app to communicate with WebRTC-enabled browsers, including Google Chrome, Mozilla Firefox, Opera, and, when available, Microsoft Spartan. The WebRTC-updated SDKs represent VoxImplant's continued leadership in simplifying the development of real-time communication...
SYS-CON Events announced today that GENBAND, a leading developer of real time communications software solutions, has been named “Silver Sponsor” of SYS-CON's WebRTC Summit, which will take place on June 9-11, 2015, at the Javits Center in New York City, NY. The GENBAND team will be on hand to demonstrate their newest product, Kandy. Kandy is a communications Platform-as-a-Service (PaaS) that enables companies to seamlessly integrate more human communications into their Web and mobile applicatio...
PubNub on Wednesday released an open source template to allow developers to add Skype-like video chat into their apps. The free template provides a fully functional video chat platform using WebRTC, PubNub and Google Authentication for a global, reliable collaboration solution. “While the WebRTC protocol has created huge excitement as a way to deliver video chat ubiquitously, there’s still a gap between the protocol itself and the ability to deploy a working, globally scaled, collaboration appl...
SOASTA, the leader in performance analytics, today reported record growth of the CloudTest community, exceeding 30,000 registered users of the CloudTest platform in Q1 2015. SOASTA also announced widespread adoption of its Web and mobile testing solutions, with more than 1,600 customers completing more than 285,000 tests using CloudTest during the quarter. This rapid growth shows that DevOps-driven digital businesses are embracing a more continuous approach to testing, and CloudTest is meeting t...
The IoT Bootcamp is coming to Cloud Expo | @ThingsExpo on June 9-10 at the Javits Center in New York. Instructor. Registration is now available at http://iotbootcamp.sys-con.com/ Instructor Janakiram MSV previously taught the famously successful Multi-Cloud Bootcamp at Cloud Expo | @ThingsExpo in November in Santa Clara. Now he is expanding the focus to Janakiram is the founder and CTO of Get Cloud Ready Consulting, a niche Cloud Migration and Cloud Operations firm that recently got acquir...
ProfitBricks has launched its new DevOps Central and REST API, along with support for three multi-cloud libraries and a Python SDK. This, combined with its already existing SOAP API and its new RESTful API, moves ProfitBricks into a position to better serve the DevOps community and provide the ability to automate cloud infrastructure in a multi-cloud world. Following this momentum, ProfitBricks has also introduced several libraries that enable developers to use their favorite language to code ...
Chef and Canonical announced a partnership to integrate and distribute Chef with Ubuntu. Canonical is integrating the Chef automation platform with Canonical's Machine-As-A-Service (MAAS), enabling users to automate the provisioning, configuration and deployment of bare metal compute resources in the data center. Canonical is packaging Chef 12 server in upcoming distributions of its Ubuntu open source operating system and will provide commercial support for Chef within its user base.
SYS-CON Events announced today that Optimal Design, an Internet of Things solution provider, will exhibit at SYS-CON's Internet of @ThingsExpo, which will take place on June 9-11, 2015, at the Javits Center in New York City, NY. Optimal Design is an award winning product development firm offering industrial design and engineering services to the consumer, medical, and defense markets.
While DevOps most critically and famously fosters collaboration, communication, and integration through cultural change, culture is more of an output than an input. In order to actively drive cultural evolution, organizations must make substantial organizational and process changes, and adopt new technologies, to encourage a DevOps culture. Moderated by Andi Mann, panelists will discuss how to balance these three pillars of DevOps, where to focus attention (and resources), where organizations m...
SYS-CON Events announced today that kintone has been named “Bronze Sponsor” of SYS-CON's 16th International Cloud Expo®, which will take place on June 9-11, 2015, at the Javits Center in New York City, NY, and the 17th International Cloud Expo®, which will take place on November 3–5, 2015, at the Santa Clara Convention Center in Santa Clara, CA. kintone promotes cloud-based workgroup productivity, transparency and profitability with a seamless collaboration space, build your own business applic...
SYS-CON Events announced today that Stratoscale, the new data center operating system, will exhibit at SYS-CON's 16th International Cloud Expo®, which will take place on June 9-11, 2015, at the Javits Center in New York City, NY. Based in Herzeliya, Israel, Stratoscale is redefining the data center, developing a hardware-agnostic, software platform hyper-converging compute, storage and networking across the rack or data center. The self-optimizing platform automatically distributes all physical...
of cloud, colocation, managed services and disaster recovery solutions, will exhibit at SYS-CON's 16th International Cloud Expo®, which will take place on June 9-11, 2015, at the Javits Center in New York City, NY. TierPoint, LLC, is a leading national provider of information technology and data center services, including cloud, colocation, disaster recovery and managed IT services, with corporate headquarters in St. Louis, MO. TierPoint was formed through the strategic combination of some of t...
How do you securely enable access to your applications in AWS without exposing any attack surfaces? The answer is usually very complicated because application environments morph over time in response to growing requirements from your employee base, your partners and your customers. In his session at 16th Cloud Expo, Haseeb Budhani, CEO and Co-founder of Soha, will share five common approaches that DevOps teams follow to secure access to applications deployed in AWS, Azure, etc., and the frict...
SYS-CON Events announced today that Soha will exhibit at SYS-CON's DevOps Summit New York, which will take place on June 9-11, 2015, at the Javits Center in New York City, NY. Soha delivers enterprise-grade application security, on any device, as agile as the cloud. This turnkey, cloud-based service enables customers to solve secure application access and delivery challenges that traditional or virtualized network solutions cannot solve because they are too expensive, inflexible and operational...