PLX Technology, Inc. Reports First Quarter 2013 Financial Results

PLX Technology, Inc. Reports First Quarter 2013 Financial Results 
SUNNYVALE, CA -- (Marketwired) -- 04/22/13 --  PLX Technology, Inc.
(PLX(R)) (NASDAQ: PLXT) 


 
--  12 Percent Growth over Q4 2012
--  Return to Profitability
--  Record PCI Express Revenues

  
PLX Technology, Inc. (PLX(R)) (NASDAQ: PLXT), the global leader in PCI
Express(R) (PCIe(R)) silicon and software connectivity solutions
enabling emerging data center architectures, today announced first
quarter revenues of $26.2 million and net income of $2.6 million, or
$0.06 per share (diluted). 
"Our successful return to profitability is centered on a company-wide
commitment to controlling costs and focusing entirely on our
leadership in innovative PCI Express products," said David Raun, PLX
president and CEO. "Our record PCI Express sales, lower expenses and
higher margins produced one of the most profitable quarters in
years."  


 
                                                                            
Non-GAAP Financial Comparison                                               
(in millions, except per share amounts)                                     
                                                  Quarterly Results         
                                           Q1 2013     Q4 2012     Q1 2012  
                                         ----------  ----------  ---------- 
Net revenues                             $     26.2  $     23.4  $     24.5 
Operating expense                        $     11.6  $     11.5  $     14.7 
Operating income (loss) from continuing                                     
 operations                              $      3.9  $      2.2  $     (0.7)
Net income (loss) from continuing                                           
 operations                              $      3.8  $      2.4  $     (0.7)
Income (loss) per share (diluted) from                                      
 continuing operations                   $     0.09  $     0.06  $    (0.02)

 
The above non-GAAP financial information (other than net revenues,
which are presented on a GAAP basis) excludes share-based
compensation, acquisition, restructuring and impairment charges,
amortization of acquired intangib
les and discontinued operations. See
"Use of Non-GAAP Financial Information" below. 


 
                                                                            
GAAP Financial Comparison                                                   
(in millions, except per share amounts)                                     
                                                 Quarterly Results          
                                          Q1 2013     Q4 2012      Q1 2012  
                                        ----------  ----------   ---------- 
Net revenues                            $     26.2  $     23.4   $     24.5 
Operating expense                       $     12.7  $     14.1   $     15.1 
Operating income (loss) from                                                
 continuing operations                  $      2.9  $     (0.4)  $     (1.2)
Net income (loss) from continuing                                           
 operations                             $      2.7  $     (0.2)  $     (1.2)
Income (loss) per share (diluted) from                                      
 continuing operations                  $     0.06  $        -   $    (0.03)

 
"As we look ahead, demand for our flagship PCI Express products
remains strong and is projected to grow in Q2, driven mostly by
enterprise data center equipment. Our much smaller legacy
connectivity product line will continue to decrease over time," said
Raun. "Overall, our business model continues to strengthen. We paid
down $6 million in liabilities in Q1 and expect continued tight cost
controls combined with revenue increases in PCI Express products to
allow solid results throughout 2013."  
Business Outlook 
 The following statements are based on current
expectations. The company does not intend to update, confirm or
change this guidance until its second quarter 2013 earnings release,
although it may provide additional details regarding its guidance
during today's scheduled conference call. 


 
--  Net revenues for the second quarter ending June 30, 2013, are expected
    to be between $25.5 million and $27.5 million
--  Gross margins are expected to be approximately 58 percent
--  Operating expenses are expected to be approximately $13.4 million.
    Included in operating expenses are share-based compensation related
    charges of approximately $0.6 million.

  
Conference Call 
 PLX management plans to conduct a conference call and
webcast today at 2:00 p.m. (PT) to discuss its first quarter results,
as well as its second quarter 2013 outlook. A live webcast of the
conference call will be available through the Investor Relations
section of the PLX Website at www.plxtech.com/investors, which also
can be heard live via telephone at (866) 318-8612, using access code
29370619. International callers may dial +1 (617) 399-5131. A
recorded replay of this webcast will be available on the PLX Website
beginning 4:00 p.m. (PT) on April 22, 2013, through 11:59 p.m. (PT)
on April 29, 2013. To listen to the replay via telephone, call (888)
286-8010 and use access code 89523400. International callers may dial
+1 (617) 801-6888.  
Use of Non-GAAP Financial Information 
 To supplement PLX's financial
statements presented on a GAAP basis, PLX has provided non-GAAP
financial information, including non-GAAP income (loss), non-GAAP
earnings (loss) per share (diluted), non-GAAP operating income (loss)
and non-GAAP operating expenses. These non-GAAP results exclude
share-based compensation, including ESOP expenses, acquisition,
restructuring and impairment related charges, amortization of
acquired intangibles and discontinued operations. A reconciliation of
the adjustments to GAAP results is included in the tables below.
Non-GAAP financial information is not meant as a substitute for GAAP
results, but is included because management believes such information
is useful to PLX investors for informational and comparative
purposes. In addition, certain non-GAAP financial information is used
internally by management to evaluate and manage the company. The
non-GAAP financial information used by PLX may differ from that used
by other companies. These non-GAAP measures should be considered in
addition to, and not a substitute for, the results prepared in
accordance with GAAP.  
Safe Harbor Statement 
 This press release includes statements that
qualify as forward-looking statements under the Private Securities
Litigation Reform Act of 1995. These include statements about the
company's estimated net revenues, estimated operating expenses and
estimated gross margins, which are set forth under the caption
"Business Outlook," and statements regarding PLX's future growth
potential, demand for PCI Express, declines in Connectivity products,
the strengthening of our business model, continued cost controls and
expected solid results for 2013.. Such statements involve risks and
uncertainties, which may cause actual results to differ materially
from those set forth in the statements. Factors that could cause
actual results to differ materially include risks and uncertainties,
such as reduced demand for products of electronic equipment
manufacturers that use the company's products, 
adverse economic
conditions in general or those specifically affecting the company's
markets, technical difficulties and delays in the development
process, errors in the products, reduced backlog for the company's
customers and unexpected expenses. Please refer to the documents
filed by the company with the SEC from time to time, including, but
not limited to, the Annual Report on Form 10-K for the year ended
December 31, 2012 which identifies important risk factors that could
cause actual results to differ from those contained in the
forward-looking statements. All forward-looking statements are made
as of today, and the company assumes no obligation to update such
statements. 
About PLX 
 PLX Technology, Inc. (NASDAQ: PLXT), based in Sunnyvale,
Calif., USA, is the industry-leading global provider of
semiconductor-based PCI Express connectivity solutions primarily
targeting enterprise data center markets. The company develops
innovative software-enriched silicon that enables product
differentiation, reliable interoperability and superior performance.
Visit PLX on plxtech.com, LinkedIn, Facebook, Twitter and YouTube. 
PLX, and the PLX logo, are trademarks of PLX Technology, Inc., which
may be registered in some jurisdictions. All other product names that
appear in this material are for identification purposes only and are
acknowledged to be trademarks or registered trademarks of their
respective companies. 


 
                                                                            
                            PLX TECHNOLOGY, INC.                            
              CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS               
                                (Unaudited)                                 
                  (in thousands, except per share amounts)                  
                                                                            
                                                                            
                                                                            
                                                Three Months Ended          
                                     March 31     December 31     March 31  
                                       2013           2012          2012    
                                    ----------   -------------   ---------- 
                                                                            
Net revenues                        $   26,218   $      23,413   $   24,532 
Cost of revenues                        10,693           9,729       10,555 
                                    ----------   -------------   ---------- 
Gross margin                            15,525          13,684       13,977 
                                    ----------   -------------   ---------- 
Operating expenses:                                                         
  Research and development               5,961           6,170        6,545 
  Selling, general and                                                      
   administrative                        6,419           6,163        8,522 
  Acquisition and restructuring                                             
   related costs                           291           1,719            - 
  Amortization of purchased                                                 
   intangible assets                         -              22           81 
                                    ----------   -------------   ---------- 
Total operating expenses                12,671          14,074       15,148 
                                    ----------   -------------   ---------- 
Income (loss) from operations            2,854            (390)      (1,171)
Interest income (expense) and                                               
 other, net                                (71)            (30)          (5)
                                    ----------   -------------   ---------- 
Income (loss) from continuing                                               
 operations before provision for                                            
 income taxes                            2,783            (420)      (1,176)
Provision (benefit) for income                                              
 taxes                                      84            (230)          48 
                                    ----------   -------------   ---------- 
Income (loss) from continuing                                               
 operations, net of tax                  2,699            (190)      (1,224)
Loss from discontinued operations,                                          
 net of tax(1)                             (57)           (423)      (6,216)
                                    ----------   -------------   ---------- 
Net income (loss)                   $    2,642   $        (613)  $   (7,440)
                                    ==========   =============   ========== 
                                                                            
Basic net income (loss) per share:                                          
  Income (loss) from continuing                                             
   operations                       $     0.06   $           -   $    (0.03)
                                    ==========   =============   ========== 
  Loss from discontinued                                                    
   operations                       $        -   $       (0.01)  $    (0.14)
                                    ==========   =============   ========== 
  Net income (loss)                 $     0.06   $       (0.01)  $    (0.17)
                                    ==========   =============   ========== 
                                                                            
Diluted net loss per share:                                                 
  Income (loss) from continuing                                             
   operations                       $     0.06   $           -   $    (0.03)
                                    ==========   =============   ========== 
  Loss from discontinued                                                    
   operations                       $        -   $       (0.01)  $    (0.14)
                                    ==========   =============   ========== 
  Net income (loss)                 $     0.06   $       (0.01)  $    (0.17)
                                    ==========   =============   ========== 
                                                                            
Shares used to compute per share                                            
 amounts:                                                                   
  Basic                                 45,366          45,053       44,729 
                                    ==========   =============   ========== 
  Diluted                               46,096          45,053       44,729 
                                    ----------   -------------   ---------- 
                                                                            
(1) Loss on discontinued operations includes gain on disposal of $1,353 for 
 the three months ended December 31, 2012                                   
                                                                            
                            PLX TECHNOLOGY, INC. 
                           
                   CONDENSED CONSOLIDATED BALANCE SHEETS                    
                                (Unaudited)                                 
                               (in thousands)                               
                                                                            
                                                                            
                                                 March 31      December 31  
                                                   2013            2012     
                                              -------------   ------------- 
ASSETS                                                                      
                                                                            
  Cash and investments                        $      13,588   $      16,711 
  Accounts receivable, net                           13,003          10,635 
  Inventories                                         9,630          10,560 
  Property and equipment, net                        10,878          11,267 
  Goodwill                                           20,461          20,461 
  Other assets                                        3,420           3,345 
                                              -------------   ------------- 
Total assets                                  $      70,980   $      72,979 
                                              =============   ============= 
                                                                            
LIABILITIES                                                                 
                                                                            
  Accounts payable                            $       7,305   $      10,738 
  Accrued compensation and benefits                   2,407           4,493 
  Accrued commissions                                   502             817 
  Other accrued expenses                              2,074           2,259 
  Short term borrowings against line of                                     
   credit                                             8,000           8,000 
                                              -------------   ------------- 
Total liabilities                                    20,288          26,307 
                                                                            
STOCKHOLDERS' EQUITY                                                        
                                                                            
  Common stock, par value                                46              45 
  Additional paid-in capital                        190,824         189,444 
  Accumulated other comprehensive loss                 (229)           (226)
  Accumulated deficit                              (139,949)       (142,591)
                                              -------------   ------------- 
Total stockholders' equity                           50,692          46,672 
                                              -------------   ------------- 
Total liabilities and stockholders' equity    $      70,980   $      72,979 
                                              -------------   ------------- 
                                                                            
                                                                            
                                                                            
                            PLX TECHNOLOGY, INC.                            
      RECONCILIATION BETWEEN GAAP AND NON-GAAP FINANCIAL INFORMATION 1      
            (unaudited, in thousands, except for per share data)            
                   (not prepared in accordance with GAAP)                   
                                                                            
                                                                            
                                                                            
                                                Three Months Ended          
                                     March 31     December 31     March 31  
                                       2013           2012          2012    
                                    ----------   -------------   ---------- 
Income (Loss) From Continuing                                               
 Operations Reconciliation                                                  
  GAAP Income (Loss)                $    2,699   $        (190)  $   (1,224)
  Acquisition and restructuring                                             
   related costs                           291           1,719            - 
  Share-based compensation                 765             887          398 
  Amortization of purchased                                                 
   intangible assets                         -              22           81 
                                    ----------   -------------   ---------- 
  Non-GAAP Income (Loss)            $    3,755   $       2,438   $     (745)
                                    ==========   =============   ========== 
                                                                            
Income (Loss) Per Share From Continuing                                     
 Operations Reconciliation                                                  
  GAAP Diluted Income (Loss) Per                                            
   Share                            $     0.06   $           -   $    (0.03)
  Effect of acquisition and                                                 
   restructuring related costs            0.01            0.04            - 
  Effect of share-based                                                     
   compensation                           0.02            0.02         0.01 
  Effect of amortization of                                                 
   purchased intangible assets               -               -            - 
                                    ----------   -------------   ---------- 
  Non-GAAP Diluted Income (Loss)                                            
   Per Share                        $     0.09   $        0.06   $    (0.02)
                                    ==========   =============   ========== 
                                                                            
Operating Income (Loss) From Continuing                                     
 Operations Reconciliation                                                  
  GAAP Operating Income (Loss)      $    2,854   $        (390)  $   (1,171)
  Share-based compensation - COGS          (23)             49           13 
  Share-based compensation - R&D           225             288          141 
  Share-based compensation - SG&A          563             550          244 
  Acquisition and restructuring                                             
   related costs                           291           1,719            - 
  Amortization of purchased                                                 
   intangible assets                         -              22           81 
                                    ----------   -------------   ---------- 
  Non-GAAP Operating Income (Loss)  $    3,910   $       2,238   $     (692)
                                    ==========   =============   ========== 
                                                                            
Operating Expense From Continuing                                           
 Operations Reconciliation                                                  
  GAAP Operating Expenses           $   12,671   $      14,074   $   15,148 
  Share-based compensation - R&D          (225)           (288)        (141)
  Share-based compensation - SG&A         (563)           (550)        (244)
  Acquisition and restructuring                                             
   related costs                          (291)         (1,719)           - 
  Amortization of purchased                        
                         
   intangible assets                         -             (22)         (81)
                                    ----------   -------------   ---------- 
  Non-GAAP Operating Expenses       $   11,592   $      11,495   $   14,682 
                                    ==========   =============   ========== 
                                                                            
1 Refer to "Use of Non-GAAP Financial Information" in the press release for 
 a discussion of management's use of non-GAAP financial measures.           
                                                                            
                                                                            
                                                                            
                            PLX TECHNOLOGY, INC.                            
                              SUPPLEMENTAL DATA                             
                                 (Unaudited)                                
                                                                            
                                                                            
                                                  Three Months Ended        
                                           March 31   December 31   March 31
                                             2013        2012         2012  
                                          ---------  ------------  ---------
Net Revenues by Geography                                                   
Americas                                     23%          15%         15%   
Asia Pacific                                 66%          70%         68%   
Europe                                       11%          15%         17%   
                                                                            
                                                                            
                                                                            
                                                  Three Months Ended        
                                           March 31   December 31   March 31
                                             2013        2012         2012  
                                          ---------  ------------  ---------
Net Revenues by Type                                                        
PCI Express Revenue                          71%          69%         65%   
Connectivity Revenue                         29%          31%         35%   

  
Investor Relations Contact: 
Leslie Green 
Green Communications Consulting, LLC (for PLX) 
Tel: (650) 312-9060 
leslie@greencommunicationsllc.com  
Editorial Contact: 
David Hurd 
Sr. Director, Corporate Communication 
Tel: (408) 328-3594 
dhurd@plxtech.com