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SECURITIES AND EXCHANGE COMMISSION
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported) July 24, 2003
PDF Solutions, Inc.
| Delaware (State or Other Jurisdiction of Incorporation) |
000-31311 (Commission File Number) |
25-1701361 (IRS Employer Identification No.) |
| 333 West San Carlos Street, Suite 700, San Jose, CA (Address of Principal Executive Offices) |
95110 (Zip Code) |
Registrant’s telephone number, including area code (408) 280-7900
Not Applicable
| Item 7. Financial Statements and Exhibits | ||||||||
| Item 9. Regulation FD Disclosure | ||||||||
| SIGNATURES | ||||||||
| EXHIBIT INDEX | ||||||||
| EXHIBIT 99.1 | ||||||||
| EXHIBIT 99.2 | ||||||||
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Item 7. Financial Statements and Exhibits.
(c) Exhibits.
| 99.1 | Press Release dated July 24, 2003 regarding financial results and certain other information related to the second quarter of fiscal 2003 | |
| 99.2 | Press Release dated July 24, 2003 regarding the financial outlook for the third quarter of fiscal 2003 |
Item 9. Regulation FD Disclosure.
The following information is furnished pursuant to Item 12, “Results of Operations and Financial Condition.”
On July 24, 2003, PDF Solutions, Inc. issued a press release regarding its financial results and certain other information related to the second quarter of fiscal year 2003. Also on July 24, 2003, PDF Solutions, Inc. issued a press release regarding the financial outlook for the third quarter of fiscal 2003. A copy of each of these press releases is attached as Exhibit 99.1 and Exhibit 99.2.
Use of Non-GAAP Information
In addition to providing results that are determined in accordance with Generally Accepted Accounting Principles (GAAP), PDF Solutions also provides certain non-GAAP financial measures that exclude certain charges as additional information relating to its operating results. PDF’s management believes that the presentation of these measures provides useful information to investors regarding certain additional financial and business trends relating to its financial condition and results of operations. PDF has also chosen to provide this information to investors to enable them to perform meaningful comparisons of its past, present and future operating results. These measures are not in accordance with, or an alternative to, GAAP and may be different from non-GAAP measures used by other companies. The calculations of non-GAAP financial measures have been adjusted to exclude the effects of amortization of stock-based compensation and intangibles, net of taxes.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| PDF Solutions, Inc. | ||||
|
By: Name: |
/s/ P. Steven Melman
P. Steven Melman |
|||
| Title: | Vice President, Finance and Administration | |||
| and Chief Financial Officer | ||||
Dated: July 24, 2003
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EXHIBIT INDEX
| Number | Exhibit | |
| 99.1 | Press Release dated July 24, 2003 regarding financial results and certain other information related to the second quarter of fiscal 2003 | |
| 99.2 | Press Release dated July 24, 2003 regarding the financial outlook for the third quarter of fiscal 2003 |
Exhibit 99.1
News Release
| Investor Relations Contact: | Corporate Communications Contact: | |
| Rochelle Krause | Abbie Kendall | |
| PDF Solutions, Inc. | Armstrong Kendall, Inc. | |
| Tel: (408) 938-6437 | Tel: (503) 672-4681 | |
| Email: rochelle.krause@pdf.com | Email: abbie@akipr.com |
PDF Solutions® Reports Second Quarter 2003
Financial Results
SAN JOSE, Calif.—July 24, 2003—PDF Solutions, Inc. (Nasdaq: PDFS) the leading provider of process-design integration technologies to enhance IC manufacturability, today announced financial results for its second fiscal quarter ended June 30, 2003.
Revenue for the second fiscal quarter of 2003 totaled $10.1 million, a decrease of 18% compared with revenue of $12.2 million for the second fiscal quarter of 2002. Pro forma net loss for the second fiscal quarter of 2003, excluding amortization of stock-based compensation and intangibles, totaled $265,000, or $0.01 per diluted share, compared with pro forma net income of $1.4 million, or $0.06 per diluted share, for the second fiscal quarter of 2002. Reported net loss for the second fiscal quarter of 2003 totaled $676,000, or $0.03 per diluted share, compared with a reported net income of $565,000, or $0.02 per diluted share, for the second fiscal quarter of 2002.
“Financial results for the quarter were in the range of prior revenue and pro forma earnings per share guidance,” said John Kibarian, PDF’s President and Chief Executive Officer. “In addition, we see accelerated customer interest in our solutions earlier in both process- and design-development cycles. This highlights that process-design interactions are becoming critical issues as the industry continues to move toward nanometer processes.”
As previously announced, the company will hold a live conference call beginning at 3:00 p.m. PDT/6:00 p.m. EDT today to discuss the quarterly results. A live
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webcast of this teleconference will be available on the company’s website at http://ir.pdf.com/medialist.cfm. A replay of the call will be available at the same website address beginning approximately two hours after completion of the live call. Further, a copy of this press release, including the disclosure and reconciliation of certain non-GAAP financial measures to the most directly comparable GAAP measure, which non-GAAP measures may be used periodically by the company’s management when discussing financial results with investors and analysts, will be available on the company’s website at http://www.pdf.com/news_archive.phtml following the date of this release.
About PDF Solutions
PDF Solutions, Inc. (Nasdaq: PDFS) is the leading provider of process-design integration technologies for manufacturing integrated circuits (ICs). PDF’s software, methodologies and services enable semiconductor companies to create IC designs that can be more easily manufactured using manufacturing processes that are more capable. By simulating deep sub-micron product and process interactions, the PDF solution offers clients reduced time to market, increased IC yield and performance, and enhanced product reliability and profitability. Headquartered in San Jose, Calif., PDF Solutions operates worldwide with additional offices in Europe and Japan. For more information, visit www.pdf.com.
PDF Solutions® is a registered trademark of PDF Solutions, Inc.
Forward-Looking Statements
Some of the statements in this press release are forward looking, including the statements regarding the level of customer interest in PDF's solutions. The words “estimate”, “project”, “expect”, “believe” and similar expressions also identify forward-looking statements. Actual results could differ materially from those expressed in any forward-looking statements. Risks and uncertainties that could cause results to differ materially include risks associated with: any unforeseen industry changes; changes in general market conditions, difficulties in modifying PDF’s solutions on a timely basis; and changes in the marketplace for our solutions, including the introduction of products or services competitive with PDF’s products and services. Readers should also refer to the risk disclosures set forth in PDF’s Report on Form 10-K filed with the SEC on March 26, 2003 and Report on Form 10-Q filed with the SEC on May 14, 2003. The forward-looking statements contained in this release are made as of the date hereof, and PDF does not assume any obligation to update such statements nor the reasons why actual results could differ materially from those projected in such statements.
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PDF SOLUTIONS, INC.
CONSOLIDATED BALANCE SHEETS (UNAUDITED)
(In thousands)
| June 30, | December 31, | |||||||||||
| 2003 | 2002 | |||||||||||
ASSETS |
||||||||||||
Current assets: |
||||||||||||
Cash and cash equivalents |
$ | 67,073 | $ | 71,490 | ||||||||
Accounts receivable, net of allowances |
6,584 | 7,924 | ||||||||||
Prepaid expenses and other current assets |
5,006 | 4,406 | ||||||||||
Total current assets |
78,663 | 83,820 | ||||||||||
Property and equipment, net |
3,453 | 3,533 | ||||||||||
Goodwill |
662 | 662 | ||||||||||
Intangible assets, net |
4,195 | 220 | ||||||||||
Other assets |
1,815 | 1,564 | ||||||||||
Total assets |
$ | 88,788 | $ | 89,799 | ||||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY |
||||||||||||
Current liabilities: |
||||||||||||
Accounts payable |
$ | 1,370 | $ | 499 | ||||||||
Accrued compensation and related benefits |
1,910 | 1,143 | ||||||||||
Other accrued liabilities |
1,364 | 1,652 | ||||||||||
Taxes payable |
686 | 1,838 | ||||||||||
Deferred revenues |
2,163 | 4,496 | ||||||||||
Billings in excess of recognized revenue |
274 | 606 | ||||||||||
Other liabilities |
1,500 | — | ||||||||||
Current portion of long-term debt |
17 | 17 | ||||||||||
Total current liabilities |
9,284 | 10,251 | ||||||||||
Long-term debt |
6 | 15 | ||||||||||
Deferred tax liability |
753 | 752 | ||||||||||
Deferred rent |
49 | 39 | ||||||||||
Stockholders’ equity: |
||||||||||||
Common stock |
3 | 3 | ||||||||||
Additional paid-in-capital |
100,641 | 99,884 | ||||||||||
Deferred stock-based compensation |
(545 | ) | (1,340 | ) | ||||||||
Notes receivable from stockholders |
(4,614 | ) | (4,998 | ) | ||||||||
Accumulated deficit |
(16,855 | ) | (14,845 | ) | ||||||||
Cumulative other comprehensive income |
66 | 38 | ||||||||||
Total stockholders’ equity |
78,696 | 78,742 | ||||||||||
Total liabilities and stockholders’ equity |
$ | 88,788 | $ | 89,799 | ||||||||
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PDF SOLUTIONS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
(In thousands, except per share data)
| Three Months Ended | Six Months Ended | |||||||||||||||||
| June 30, | June 30, | June 30, | June 30, | |||||||||||||||
| 2003 | 2002 | 2003 | 2002 | |||||||||||||||
Revenue: |
||||||||||||||||||
Design-to-silicon yield solutions |
$ | 8,034 | $ | 9,505 | $ | 16,142 | $ | 17,885 | ||||||||||
Gain share |
2,056 | 2,731 | 3,015 | 5,808 | ||||||||||||||
Total revenue |
$ | 10,090 | $ | 12,236 | $ | 19,157 | $ | 23,693 | ||||||||||
Cost and expenses: |
||||||||||||||||||
Cost of design-to-silicon yield |
3,514 | 4,110 | 6,958 | 7,974 | ||||||||||||||
Research and development |
4,453 | 3,964 | 8,785 | 7,154 | ||||||||||||||
Selling, general and administrative |
2,994 | 2,614 | 5,697 | 5,168 | ||||||||||||||
Stock-based compensation amortization* |
329 | 770 | 978 | 1,558 | ||||||||||||||
Total costs and expenses |
11,290 | 11,458 | 22,418 | 21,854 | ||||||||||||||
Income (loss) from operations |
(1,200 | ) | 778 | (3,261 | ) | 1,839 | ||||||||||||
Interest and other income |
345 | 338 | 720 | 697 | ||||||||||||||
Income (loss) before taxes |
(855 | ) | 1,116 | (2,541 | ) | 2,536 | ||||||||||||
Tax (benefit) provision |
(179 | ) | 551 | (531 | ) | 1,391 | ||||||||||||
Net income (loss) |
$ | (676 | ) | $ | 565 | $ | (2,010 | ) | $ | 1,145 | ||||||||
Net income (loss) per share: |
||||||||||||||||||
Basic |
$ | (0.03 | ) | $ | 0.03 | $ | (0.09 | ) | $ | .0.05 | ||||||||
Diluted |
$ | (0.03 | ) | $ | 0.02 | $ | (0.09 | ) | $ | 0.05 | ||||||||
Weighted average common shares: |
||||||||||||||||||
Basic |
22,614 | 21,814 | 22,551 | 21,726 | ||||||||||||||
Diluted |
22,614 | 22,943 | 22,551 | 23,192 | ||||||||||||||
* Stock-based compensation amortization: |
||||||||||||||||||
Cost of design-to-silicon yield solutions |
$ | 86 | $ | 223 | $ | 216 | $ | 486 | ||||||||||
Research and development |
155 | 366 | 563 | 804 | ||||||||||||||
Selling, general and administrative |
88 | 181 | 199 | 268 | ||||||||||||||
| $ | 329 | $ | 770 | $ | 978 | $ | 1,558 | |||||||||||
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PDF SOLUTIONS, INC.
RECONCILIATION OF REPORTED GAAP NET INCOME (LOSS) TO PRO FORMA
NET INCOME (LOSS)
(UNAUDITED)
(In thousands, except per share data)
| Three Months Ended | ||||||||||||
| June 30, | June 30, | |||||||||||
| 2003 | 2002 | |||||||||||
Net income (loss) |
$ | (676 | ) | $ | 565 | |||||||
Stock-based compensation amortization |
329 | 770 | ||||||||||
Amortization of intangibles, net |
82 | 28 | ||||||||||
Pro forma net income (loss) |
$ | (265 | ) | $ | 1,363 | |||||||
Pro forma net income (loss) per share – diluted |
$ | (0.01 | ) | $ | 0.06 | |||||||
Weighted average common shares – diluted |
22,614 | 22,943 | ||||||||||
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Exhibit 99.2
News Release
| Investor Relations Contact: | Corporate Communications Contact: | |
| Rochelle Krause | Abbie Kendall | |
| PDF Solutions, Inc. | Armstrong Kendall, Inc. | |
| Tel: (408) 938-6437 | Tel: (503) 672-4681 | |
| Email: rochelle.krause@pdf.com | Email: abbie@akipr.com |
PDF Solutions® Provides Financial Outlook For
The Third Fiscal Quarter of 2003
SAN JOSE, Calif.—July 24, 2003—PDF Solutions, Inc. (Nasdaq: PDFS), the leading provider of process-design integration technologies to enhance IC manufacturability, today provided its financial outlook for the third fiscal quarter ending September 30, 2003.
PDF Solutions expects total revenue in the range of $10.8 million to $11.3 million for the third fiscal quarter ending September 30, 2003. Pro forma net income (loss) for the third fiscal quarter of 2003, excluding amortization of stock-based compensation and intangibles, is projected in the range of ($165,000) to $165,000 or ($0.01) to $0.01 per diluted share.
Reported net loss, on a GAAP basis, is projected in the range of $165,000 to $495,000, or $0.01 to $0.02 per diluted share.
As previously announced, the company will hold a live conference call beginning at 3:00 p.m. PDT/6:00 p.m. EDT today to discuss these quarterly results. A live webcast of this teleconference will be available on the company’s website at http://ir.pdf.com/medialist.cfm. A replay of the call will be available at the same website address beginning approximately two hours after completion of the live call. Further, a copy of this press release, including the disclosure and reconciliation of certain non-GAAP financial measures to the most directly comparable GAAP measure, which non-GAAP measures may be used periodically by the company’s management when discussing financial results with investors and analysts, will be available on the company’s website at http://www.pdf.com/news_archive.phtml following the date of this release.
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Effectiveness of Guidance
The outlook set forth above represents PDF Solutions’ expectations only as of the date of this release, and should not be viewed as a statement about PDF Solutions’ expectations after this date. Although this release will remain available on PDF Solutions’ website, its continued availability does not indicate that PDF Solutions is reaffirming or confirming its continued validity. PDF Solutions does not intend to report on its progress, or provide comments to analysts or investors on or otherwise update such guidance until it releases its quarterly results.
About PDF Solutions
PDF Solutions, Inc. (Nasdaq: PDFS) is the leading provider of process-design integration technologies for manufacturing integrated circuits (ICs). PDF’s software, methodologies and services enable semiconductor companies to create IC designs that can be more easily manufactured using manufacturing processes that are more capable. By simulating deep sub-micron product and process interactions, the PDF solution offers clients reduced time to market, increased IC yield and performance, and enhanced product reliability and profitability. Headquartered in San Jose, Calif., PDF Solutions operates worldwide with additional offices in Europe and Japan. For more information, visit www.pdf.com.
PDF Solutions® is a registered trademark of PDF Solutions, Inc.
Forward-Looking Statements
Some of the statements in this press release are forward looking, including the statements regarding PDF’s 2003 Third Fiscal Quarter Outlook, the expected growth in revenue, the pro forma net loss and pro forma net loss per share and the reported net loss and net loss per share. The words “estimate”, “project”, “expect”, “believe” and similar expressions also identify forward-looking statements. Actual results could differ materially from those expressed in any forward-looking statements. Risks and uncertainties that could cause results to differ materially include risks associated with: any unforeseen industry changes; difficulties in modifying PDF’s solutions on a timely basis; and changes in the marketplace for our solutions, including the introduction of products or services competitive with PDF’s products and services. Readers should also refer to the risk disclosures set forth in PDF’s Report on Form 10-K filed with the SEC on March 26, 2003 and Report on Form 10-Q filed with the SEC on May 14, 2003. The forward-looking statements contained in this release are made as of the date hereof, and PDF does not assume any obligation to update such statements nor the reasons why actual results could differ materially from those projected in such statements.
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PDF SOLUTIONS, INC.
RECONCILIATION OF PROJECTED REPORTED GAAP NET LOSS TO
PROJECTED PRO FORMA NET LOSS
(In thousands, except per share data)
| Three Months Ending | |||||||||||||||
| PROJECTED RESULTS | September 30, 2003 | ||||||||||||||
Net loss per share - diluted |
$ | (0.02 | ) | to | $ | (0.01 | ) | ||||||||
Net loss |
$ | (495 | ) | to | $ | (165 | ) | ||||||||
Stock-based compensation amortization |
250 | 250 | |||||||||||||
Amortization of intangibles, net |
80 | 80 | |||||||||||||
Pro forma net loss |
$ | (165 | ) | to | $ | 165 | |||||||||
Pro forma net loss per share - diluted |
$ | (0.01 | ) | to | $ | 0.01 | |||||||||
Weighted average common shares - diluted |
23,000 | 24,500 | |||||||||||||
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