Avid revenues top $222 million for second quarter
Avid Technology today reported revenues of $222.2 million for the three month period ended June 30, 2006 compared to $160.1 million for the same period in 2005.
GAAP net income for the quarter was $2.7 million, or $.06 per diluted share compared to GAAP net income of $13.6 million, or $.37 per diluted share, in the second quarter of 2005. GAAP net income in the second quarter of 2006 includes $11.8 million of non-cash acquisition related charges, non-cash stock-based compensation and related tax adjustments. This compares to $2.3 million of acquisition related charges, stock-based compensation and related tax adjustments included in GAAP net income for the second quarter of 2005.
“Our June quarter results were solid,” said David Krall, Avid’s president and chief executive officer. “Contributing substantially to these results was the on-schedule delivery of all of the new products announced at the National Association of Broadcasters convention in April, that were scheduled to ship during the second quarter. We continue to emphasize the importance of delivering new products to our customers on time, and our Interplay(TM) nonlinear workflow engine is still expected to ship in the third quarter. In broadcast, we had a strong bookings quarter and increased our backlog substantially. We continue to rebuild our consumer business, and the improvements that have been made to Pinnacle Studio(TM) 10 are being reflected by significant increases in user satisfaction ratings. Finally, our audio business had another good quarter, highlighted by strong performances in both our home recording and live sound markets.”
Revenues for the six month period ended June 30, 2006, were $440.3 million compared to revenues of $326.1 million for the same period in 2005. GAAP net income for the first six months of 2006 was $6.0 million, or $.14 per diluted share, compared to GAAP net income of $33.3 million, or $.90 per diluted share, for the same period in 2005. GAAP net income for the six month period ended June 30, 2006 includes $24.6 million of non-cash acquisition-related amortization, stock-based compensation charges, restructuring charges, in-process research and development, and related tax adjustments. This compares to $4.8 million of acquisition-related amortization, stock-based compensation and related tax adjustments included in GAAP net income for the six month period ended June 30, 2005.
Stock Repurchase Program
Avid also announced that its Board of Directors approved a program to repurchase up to $50 million of stock through transactions on the open market, in block trades or otherwise. The stock repurchase program will be funded using the company’s working capital. As of June 30, 2006, the company had cash, cash equivalents and marketable securities of approximately $238.1 million.
Use of Non-GAAP Financial Measures
This press release may contain “non-GAAP financial measures” under the rules of the Securities and Exchange Commission. This non-GAAP information supplements, and is not intended to represent a measure of performance in accordance with, disclosures required by generally accepted accounting principles, or GAAP. We believe it is useful for ourselves and investors to review both GAAP and non-GAAP measures in order to assess our performance. We also believe these non-GAAP financial measures are a meaningful measure of our operating performance and will assist investors in understanding our results of operations on a comparative basis.
A conference call to discuss Avid’s second quarter 2006 financial results and the company’s outlook for the balance of 2006 will be held today, July 20, 2006, at 5:00 p.m. EDT. The call will be open to the public, and can be accessed by dialing (913) 981-5509 and referencing confirmation code 9034125. The call and subsequent replay will also be available on Avid’s web site. To listen via this alternative, go to the Investor Relations page under the About Us menu at www.avid.com for complete details 10-15 minutes prior to the start of the conference call.
The above release is subject to the completion and filing of our Quarterly Report on Form 10-Q. This release includes forward-looking statements, as defined by the Private Securities Litigation Reform Act of 1995, about Avid’s performance. There are a number of factors that could cause actual events or results to differ materially from those indicated by such forward-looking statements, such as market acceptance of Avid’s existing and new products, Avid’s ability to anticipate customer needs, competitive factors, including pricing pressures, fluctuating currency exchange rates, delays in product shipments, and the other important events and factors disclosed previously and from time to time in Avid’s filings with the U.S. Securities and Exchange Commission. In addition, the forward-looking statements contained herein represent Avid’s estimate only as of today and should not be relied upon as representing the company’s estimate as of any subsequent date. While Avid may elect to update these forward-looking statements at some point in the future, Avid specifically disclaims any obligation to do so, even if the estimate changes.
About Avid Technology, Inc.
Avid Technology, Inc. is the world leader in digital nonlinear media creation, management, and distribution solutions, enabling film, video, audio, animation, games, and broadcast professionals to work more efficiently, productively, and creatively. For more information about the company’s Oscar(R), Grammy(R), and Emmy(R) award-winning products and services, please visit: www.avid.com.
(C) 2006 Avid Technology, Inc. All rights reserved. Avid, Digidesign, Film Composer, Interplay, Media Composer, Pinnacle Studio and Pro Tools are either registered trademarks or trademarks of Avid Technology, Inc. or its subsidiaries in the United States and/or other countries. Avid received an Oscar statuette representing the 1998 Scientific and Technical Award for the concept, design, and engineering of the Avid(R) Film Composer(R) system for motion picture editing. Digidesign, Avid’s audio division, received an Oscar statuette representing the 2003 Scientific and Technical Award for the design, development, and implementation of its Pro Tools(R) digital audio workstation. Oscar is a trademark and service mark of the Academy of Motion Picture Arts and Sciences. Emmy is a registered trademark of ATAS/NATAS. Grammy is a trademark of the National Academy of Recording Arts and Sciences, Inc. All other trademarks contained herein are the property of their respective owners.