CIMdata PLM Industry Summary Online Archive
4 December 2008
Financial News
Magma Beats Revenue and Earnings Guidance for Second Quarter, Reports Revenue of $36.5 Million
Magma Design Automation Inc. reported revenue of $36.5 million for its fiscal 2009 second quarter, ended Nov. 2, 2008. This exceeded the revenue guidance range issued by the company on August 28, 2008 of $34 million to $35 million. Second-quarter revenue decreased 32 percent from the $53.5 million reported for the year-ago second quarter, ended Sept. 30, 2007.
"Revenue and earnings exceeded our guidance range as we executed effectively against our operating plan during the second quarter," said Rajeev Madhavan, chairman and CEO of Magma. "But despite the success of Q2, we believe it is prudent to adapt our outlook to the realities of the current economic environment and reduce our expected revenue for fiscal 2009 to a range of $144 million to $146 million. Our products continue to do well in competitive engagements, but in this period of economic uncertainty customers are paying particular scrutiny to their spending."
GAAP Results
In accordance with generally accepted accounting principles (GAAP), Magma reported a net loss of $(25.9) million, or $(0.59) per share (basic and diluted), for the second quarter. This result was better than the guidance range issued by the company on August 28, 2008 of a loss between $(0.70) and $(0.68) a share and compares to a net loss of $(6.4) million, or $(0.16) per share (basic and diluted), for the year-ago second quarter.
Non-GAAP Results
Magma's non-GAAP net income was a net loss of $(6.3) million for the quarter, or $(0.14) per share (diluted). This result was better than the guidance range issued by the company on August 28, 2008 of a loss between $(0.20) and $(0.18) a share and compares to non-GAAP net income of $7.0 million, or $0.15 per share (diluted), for the year-ago second quarter.
Non-GAAP net loss for the second quarter of fiscal 2009 excludes the effects of amortization of developed technology, amortization of intangible assets, amortization of deferred stock-based compensation, amortization of debt issuance costs and debt discount accretion, charges associated with losses on equity and other investments, restructuring charges, and acquisition-related expenses and the related provision for income taxes. A reconciliation of non-GAAP results to GAAP results is included in this press release. Non-GAAP net income for the second quarter of fiscal 2008 excluded the above items, except restructuring charges, and excluded in-process research and development and interest expense.
Business Outlook
For Magma's fiscal 2009 third quarter, ending Feb. 1, 2009, the company expects total revenue in the range of $28.0 million to $29.0 million. GAAP net loss per share is expected to be in the range of $(0.67) to $(0.65) and non-GAAP net loss per share is expected to be in the range of $(0.17) to $(0.15).
Magma is adjusting its outlook for fiscal 2009, ending May 3, 2009. For fiscal 2009 the company now expects total revenue in the range of $144.0 million to $146.0 million, a reduction from the previous guidance range of $158.0 million to $160.0 million. The company now expects fiscal 2009's GAAP net loss per share to be in the range of $(2.03) to $(1.99), compared to the previous expectation of a loss in the range of $(1.93) to $(1.89). The company now expects fiscal 2009's non-GAAP net loss per share to be in the range of $(0.29) to $(0.25), compared to the previous expectation of a loss in the range of $(0.19) to $(0.15). All guidance issued by the company before December 4, 2008 is no longer in effect.
A Financial Data Supplement containing detailed financial information intended to provide guidance and further insight into our business is available online in the Investor Relations section of the Magma website.
Conference Call
Magma will discuss the financial results for the second quarter, along with forward-looking guidance, during a live earnings call today at 2 p.m. PST.
Following completion of the call, a webcast replay of the call will be available at http://investor.magma-da.com/medialist.cfm through Dec. 11, 2008. Those without Internet access may listen to a replay of the call by telephone until 11:59 p.m. PST on Dec. 11 by calling:
U.S. & Canada: (888) 203-1112 , code #4002680
Elsewhere: (719) 457-0820 , code #4002680
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