SAN JOSE, Calif., Jan. 28, 2016 /PRNewswire/ -- Quantum Corp. (NYSE: QTM) today reported results for the fiscal third quarter 2016 ended Dec. 31, 2015.
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Fiscal Third Quarter 2016 Results:
(All comparisons are relative to the fiscal third quarter 2015.)
-- Revenue was $128.0 million, driven by continued strength in scale-out storage offset by overall weakness in the general storage market and pricing environment of commodity tape media products. -- Scale-out storage and related service revenue grew approximately $8.5 million to an all-time high of $35.7 million, a 31 percent increase, marking the 18(th) consecutive quarter of year-over-year growth. -- Royalty revenue increased $0.6 million to $11.3 million. -- Disk backup systems and related service revenue decreased to $19.6 million. -- Branded tape automation and related service revenue decreased to $38.5 million, while OEM tape automation and related service revenue decreased to $12.7 million. -- Devices and media revenue decreased to $10.2 million as a result of a $3.5 million decline in tape media revenue. -- GAAP and non-GAAP operating income of $2.0 million and $7.2 million, respectively. -- The GAAP net loss was $0.3 million, or $0.00 per diluted share. -- The non-GAAP net income was $5.3 million, or $0.02 per diluted share.
"We are pleased with our overall results and the continued scale-out revenue growth this quarter, to a new record high, especially given the overall weakness in the broad storage market environment," said Jon Gacek, president and CEO of Quantum. "In response to the market conditions, we also successfully implemented significant operational changes during the quarter that improved our profitability. For the quarter, our data protection revenue increased sequentially -- with higher sales of both disk and tape automation products. In our scale-out storage solutions line, targeted at specialized workflows, we grew revenue 31 percent over the comparable quarter a year ago, even with no 'mega deals' above $1 million in the just-completed quarter. Excluding mega deals, scale-out storage revenue grew 48 percent and 49 percent, respectively, over the comparable three- and nine-month periods in the prior year.
"For the fourth quarter, we will continue to focus on growing our run-rate scale-out revenue driven by expanding our media and entertainment, surveillance and technical workflow opportunities, and we will continue to work to close the mega deals in our sales funnel. In addition, similar to the third quarter, we will actively manage tape media revenue based on the pricing environment and optimize our activity for profit. We will also continue to manage our spending and our investments to achieve the right balance across our financial objectives."
The company also announced today that Linda Breard has resigned as senior vice president and chief financial officer of Quantum to pursue another opportunity. Chris Willis, vice president, Financial Planning and Analysis of Quantum, will serve as interim CFO while the company completes its search process for a permanent CFO.
Fiscal Fourth Quarter 2016 Outlook
Based on current market conditions, including tape media pricing dynamics and the difficulty in forecasting large and mega deals given their long sales cycles, Quantum provided the following guidance for the fiscal fourth quarter:
-- Revenue of $118 million to $122 million. -- GAAP and non-GAAP gross margin of approximately 43-44 percent. -- GAAP and non-GAAP operating expenses of approximately $50 million to $51 million and $48 million to $49 million, respectively. -- Interest expense of $1.5 million and taxes of $400,000. -- GAAP and non-GAAP earnings per share of ($0.01) to $0.00 and $0.00 to $0.01, respectively.
Fiscal Third Quarter 2016 Business Highlights
-- Quantum purchased the remaining $83.7 million of aggregate principal amount of its convertible subordinated notes due November 2015, plus accrued interest, using $16.3 million in restricted cash and $68.9 million of its revolving credit facility with Wells Fargo Capital Finance. -- The company unveiled Xcellis(TM) workflow storage, Quantum's next-generation, high-performance storage solution engineered to optimize demanding workflows, accelerate time to insight and empower organizations to drive greater success. The new solution addresses the explosive growth of unstructured data and the opportunity to capitalize on its strategic value by enabling users to share and leverage this data more quickly, easily and cost-effectively. Powered by Quantum StorNext(®) and its industry-leading streaming performance, Xcellis can be deployed as a standalone system or as the primary storage component within a multi-tier storage environment incorporating object storage, tape and cloud technologies. -- Quantum extended its StorNext scale-out platform with the release of StorNext 5.3, providing a range of advanced data management capabilities for multi-tier storage and hybrid cloud environments. In addition to powering the company's new Xcellis workflow storage solution, it also serves as the data management engine in Artico(TM), Quantum's intelligent NAS archive appliance. -- Quantum expanded its Q-Cloud(®) offerings with the launch of Q-Cloud Vault, a new service that enables users to take advantage of secure, low-cost public cloud storage for long-term retention of digital assets. Q-Cloud Vault is available for StorNext 5.3 users. -- The company released StorNext Connect 1.1, a significantly enhanced version of its easy-to-use management tool that simplifies the installation, discovery, administration and monitoring of StorNext environments. StorNext Connect(TM) is the first product of its kind to integrate management and reporting of a multi-tier storage environment, including disk, tape, object storage and cloud resources. -- Quantum added LTO-7 technology to its tiered storage portfolio, more than doubling the capacity over previous generations and enabling low-cost, energy-efficient and secure storage for protecting and retaining data.
Conference Call and Audio Webcast Notification
Quantum will hold a conference call today, Jan. 28, 2016, at 2:00 p.m. PST to discuss its fiscal third quarter results. Press and industry analysts are invited to attend in listen-only mode.
Dial-in number: (719) 457-2083 (U.S. and International); access code: 4726503
Replay number: (719) 457-0820 (U.S. and International); access code: 4726503
Replay expiration: Tuesday, Feb. 2, 2016, at 5:00 p.m. PST
Webcast site: www.quantum.com/investors
About Quantum
Quantum is a leading expert in scale-out storage, archive and data protection, providing solutions for capturing, sharing and preserving digital assets over the entire data lifecycle. From small businesses to major enterprises, more than 100,000 customers have trusted Quantum to address their most demanding data workflow challenges. With Quantum, customers can Be Certain(TM) they have the end-to-end storage foundation to maximize the value of their data by making it accessible whenever and wherever needed, retaining it indefinitely and reducing total cost and complexity. See how at www.quantum.com/customerstories.
Quantum, the Quantum logo, Be Certain, Xcellis, Artico, Q-Cloud, StorNext and StorNext Connect are either registered trademarks or trademarks of Quantum Corporation and its affiliates in the United States and/or other countries. All other trademarks are the property of their respective owners.
"Safe Harbor" Statement: This press release contains "forward-looking" statements. All statements other than statements of historical fact are statements that could be deemed forward-looking statements. Specifically, but without limitation, statements relating to: i) our focuses for the fourth quarter of this fiscal year, including growing our run-rate scale-out revenue, closing the mega deals in our sales funnel, managing our tape media revenue and managing our spending and investments; and ii) all of our statements under the heading "Fiscal Fourth Quarter 2016 Outlook" are forward-looking statements within the meaning of the Safe Harbor. All forward-looking statements in this press release are based on information available to Quantum on the date hereof. These statements involve known and unknown risks, uncertainties and other factors that may cause Quantum's actual results to differ materially from those implied by the forward-looking statements. More detailed information about these risk factors are set forth in Quantum's periodic filings with the Securities and Exchange Commission, including, but not limited to, those risks and uncertainties listed in the section entitled "Risk Factors," in Quantum's Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on November 6, 2015 and in Quantum's Annual Report on Form 10-K filed with the Securities and Exchange Commission on June 12, 2015. Quantum expressly disclaims any obligation to update or alter its forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law.
Use of Non-GAAP Financial Measures
Quantum believes that the non-GAAP financial measures disclosed above provide useful and supplemental information to investors regarding its quarterly financial performance. Quantum management and Board of Directors use these non-GAAP financial measures internally to understand, manage and evaluate the company's business results and make operating decisions. For instance, Quantum management often makes decisions regarding staffing, future management priorities and how the company will direct future operating expenses on the basis of non-GAAP financial measures. In addition, compensation of our employees is based in part on the performance of our business based on non-GAAP operating income.
The non-GAAP financial measures used in this press release exclude the impact of the items below for the following reasons:
Amortization of Intangible Assets
This includes acquired intangibles such as purchased technology and customer relationships in connection with prior acquisitions. These expenses are not factored into management's evaluation of potential acquisitions or Quantum's performance after completion of the acquisitions because they are not related to Quantum's core operating performance. In addition, the frequency and amount of such charges can vary significantly based on the size and timing of acquisitions and the maturities of the businesses being acquired. Excluding acquisition-related charges from non-GAAP measures provides investors with a basis to compare Quantum against the performance of other companies without the variability caused by purchase accounting.
Share-Based Compensation Expense
Share-based compensation expense relates primarily to equity awards such as stock options and restricted stock units. Share-based compensation is a non-cash expense that varies in amount from period to period and is dependent on market forces that are often beyond Quantum's control. Management believes that non-GAAP measures adjusted for share-based compensation provide investors with a basis to measure Quantum's core performance against the performance of other companies without the variability created by share-based compensation as a result of the variety of equity awards used by other companies and the varying methodologies and assumptions used.
Restructuring Charges
Restructuring charges primarily relate to expenses associated with changes to Quantum's operating structure. Restructuring charges are excluded from non-GAAP financial measures because they are not considered core operating activities. Although Quantum has engaged in various restructuring activities in the past, each has been a discrete event based on a unique set of business objectives. Management believes that it is appropriate to exclude restructuring charges from Quantum's non-GAAP financial measures, as it enhances the ability of investors to compare Quantum's period-over-period operating results from continuing operations.
Outsourcing Transition Costs
Outsourcing transition costs are expenses attributable to transitioning our manufacturing to an outsourced model. These costs are excluded from non-GAAP financial measures because they are not considered core operating activities and management believes that it is appropriate to exclude these costs in order to provide investors the ability to compare Quantum's period-over-period operating results from continuing operations.
Proxy Contest and Related Costs
Proxy contest and related costs are expenses incurred to respond to activities and inquiries of Starboard Value LP, including their proxy solicitation. The Company has not incurred significant expenses in connection with such matters in historical periods and these costs are not considered core operating activities. Management believes that it is appropriate to exclude these costs in order to provide investors the ability to compare Quantum's period-over-period operating results from continuing operations.
Crossroads Patent Litigation Costs
Crossroads patent litigation costs are expenses incurred to defend ourselves and perform other activities related to a patent infringement lawsuit filed by Crossroads Systems, Inc. These costs are excluded from non-GAAP financial measures because they are not considered core operating activities, and management believes that it is appropriate to exclude these costs in order to provide investors the ability to compare Quantum's period-over-period operating results from continuing operations.
Acquisition Expenses
The acquisition expenses were those expenses incurred to acquire Symform, Inc. ("Symform") and are not part of Quantum's future core operations.
Symform Expenses, Net
Quantum acquired a cloud storage services platform from Symform in July 2014. Symform revenue comprises revenue generated from the Symform cloud storage services platform. Symform expenses consist of costs related to running, maintaining and further developing the Symform cloud storage services platform as well as the costs of integrating Symform into Quantum's business. Management believed that it was appropriate to exclude these amounts in fiscal 2015 in order to provide investors with a view of Quantum's results consistent with how management viewed and ran the business. Beginning fiscal 2016, Symform has been fully integrated into our core operations and therefore, Symform revenue and expenses are no longer excluded from our results.
Loss on Debt Extinguishment
The loss on debt extinguishment relates to a specific debt repurchase action undertaken in October 2015. The loss is excluded from non-GAAP financial measures because it is not considered a core operating activity and management believes that it is appropriate to exclude the loss in order to provide investors the ability to compare Quantum's period-over-period results from continuing operations.
Non-GAAP financial measures should not be considered as a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP. They are limited in value because they exclude charges that have a material impact on the company's reported financial results and, therefore, should not be relied upon as the sole financial measures to evaluate the company. The non-GAAP financial measures are meant to supplement, and be viewed in conjunction with, GAAP financial measures. Investors are encouraged to review the reconciliation of the non-GAAP financial measures to their most directly comparable GAAP financial measures as provided in the tables accompanying this press release.
Contact: Brinlea Johnson or Allise Furlani Investor Relations The Blueshirt Group (212) 331-8424 or (212) 331-8433 brinlea@blueshirtgroup.com or allise@blueshirtgroup.com
QUANTUM CORPORATION CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands) (Unaudited) December 31, 2015 March 31, 2015* ----------------- -------------- Assets Current assets: Cash and cash equivalents $32,919 $67,948 Restricted cash 2,763 2,621 Accounts receivable 101,269 124,159 Manufacturing inventories 33,569 50,274 Service parts inventories 22,367 24,640 Other current assets 11,578 11,942 ------ ------ Total current assets 204,465 281,584 Long-term assets: Property and equipment 13,893 14,653 Intangible assets 498 731 Goodwill 55,613 55,613 Other long-term assets 3,732 4,577 ----- ----- Total long-term assets 73,736 75,574 $278,201 $357,158 ======== ======== Liabilities and Stockholders' Deficit Current liabilities: Accounts payable $41,666 $54,367 Accrued warranty 3,422 4,219 Deferred revenue, current 86,416 95,899 Accrued restructuring charges, current 1,757 3,855 Convertible subordinated debt, current - 83,345 Accrued compensation 24,680 35,414 Other accrued liabilities 13,317 20,740 ------ ------ Total current liabilities 171,258 297,839 Long-term liabilities: Deferred revenue, long-term 34,182 39,532 Accrued restructuring charges, long-term 831 991 Long-term debt 68,920 - Convertible subordinated debt, long-term 69,138 68,793 Other long-term liabilities 10,738 10,441 ------ ------ Total long-term liabilities 183,809 119,757 Stockholders' deficit (76,866) (60,438) $278,201 $357,158 ======== ========
* Derived from the March 31, 2015 audited Consolidated Financial Statements.
QUANTUM CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except per share amounts) (Unaudited) Three Months Ended Nine Months Ended ------------------ ----------------- December 31, December 31, 2015 2014 December 31, 2015 December 31, 2014 ------------- ------------- ----------------- ----------------- Revenue: Product $79,672 $92,166 $213,448 $257,576 Service 37,099 39,191 112,285 116,848 Royalty 11,277 10,706 30,196 30,873 ------ ------ ------ ------ Total revenue 128,048 142,063 355,929 405,297 Cost of revenue: Product 56,323 59,772 156,360 170,273 Service 15,028 17,224 49,590 52,502 ------ ------ ------ ------ Total cost of revenue 71,351 76,996 205,950 222,775 ------ ------ ------- ------- Gross margin 56,697 65,067 149,979 182,522 Operating expenses: Research and development 11,148 13,969 37,841 43,680 Sales and marketing 28,212 27,494 83,860 83,417 General and administrative 13,488 13,815 41,610 42,271 Restructuring charges 1,895 187 2,540 1,676 ----- --- ----- ----- Total operating expenses 54,743 55,465 165,851 171,044 Gain on sale of assets - - - 462 --- --- --- --- Income (loss) from operations 1,954 9,602 (15,872) 11,940 Other income and expense (22) 125 406 215 Interest expense (1,406) (2,460) (5,304) (7,360) Loss on debt extinguishment (394) - (394) - ---- --- ---- --- Income (loss) before income taxes 132 7,267 (21,164) 4,795 Income tax provision 431 336 1,117 940 Net income (loss) $(299) $6,931 $(22,281) $3,855 ===== ====== ======== ====== Basic net income (loss) per share $(0.00) $0.03 $(0.09) $0.02 Diluted net income (loss) per share $(0.00) $0.03 $(0.09) $0.01 Weighted average shares: Basic 264,003 255,860 261,849 253,773 Diluted 264,003 302,855 261,849 257,807 Included in the above Statements of Operations: Amortization of intangibles: Cost of revenue $48 $160 $233 $753 Sales and marketing - - - 2,784 48 160 233 3,537 Share-based compensation: Cost of revenue 313 362 1,006 1,109 Research and development 488 600 1,529 1,983 Sales and marketing 658 830 2,367 2,627 General and administrative 780 1,126 2,437 2,936 2,239 2,918 7,339 8,655 Outsourcing transition costs: Cost of revenue - - - 126 - - - 126 Proxy contest and related costs: General and administrative - 125 - 972 - 125 - 972 Crossroads patent litigation costs: General and administrative 1,054 325 2,694 744 1,054 325 2,694 744 Acquisition expenses: General and administrative - - - 4 - - - 4 Symform expenses, net: Gross margin - 30 - 50 Research and development - 131 - 241 Sales and marketing - 104 - 195 $ - $265 $ - $486
QUANTUM CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands) (Unaudited) Nine Months Ended ----------------- December 31, 2015 December 31, 2014 ----------------- ----------------- Cash flows from operating activities: Net income (loss) $(22,281) $3,855 Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: Depreciation 4,945 6,364 Amortization of intangible assets 233 3,537 Amortization and write-off of debt issuance costs 894 1,246 Service parts lower of cost or market adjustment 4,640 2,690 Gain on sale of assets - (462) Deferred income taxes (1) (11) Share-based compensation 7,339 8,655 Changes in assets and liabilities, net of effect of acquisition: Accounts receivable 22,890 (9,023) Manufacturing inventories 13,503 (6,145) Service parts inventories (547) (686) Accounts payable (12,708) 9,325 Accrued warranty (797) (1,328) Deferred revenue (14,833) (8,928) Accrued restructuring charges (2,258) (2,197) Accrued compensation (10,711) 6,774 Other assets and liabilities (6,222) (2,549) ------ ------ Net cash provided by (used in) operating activities (15,914) 11,117 Cash flows from investing activities: Purchases of property and equipment (2,800) (2,882) Proceeds from sale of assets - 462 Change in restricted cash (142) (139) Purchases of other investments - (22) Return of principal from other investments - 104 Payment for business acquisition, net of cash acquired - (517) --- ---- Net cash used in investing activities (2,942) (2,994) Cash flows from financing activities: Borrowings of long-term debt, net 68,920 - Repayments of convertible subordinated debt (83,735) - Payment of taxes due upon vesting of restricted stock (3,112) (2,212) Proceeds from issuance of common stock 1,772 2,060 ----- ----- Net cash used in financing activities (16,155) (152) Effect of exchange rate changes on cash and cash equivalents (18) (113) --- ---- Net increase (decrease) in cash and cash equivalents (35,029) 7,858 Cash and cash equivalents at beginning of period 67,948 99,125 Cash and cash equivalents at end of period $32,919 $106,983 ======= ========
QUANTUM CORPORATION GAAP TO NON-GAAP RECONCILIATION (In thousands, except per share amounts) (Unaudited) Three Months Ended December 31, 2015 ------------------------------------ Gross Margin Gross Income From Operating Net Income (Loss) Per Share Net Per Share Net Margin Operations Margin Income (Loss), Income (Loss), Rate Basic Diluted ------------ ------ ------------ ---------- ---------------- -------------- -------------- GAAP $56,697 44.3% $1,954 1.5% $(299) $(0.00) $(0.00) Non-GAAP Reconciling Items: Amortization of intangibles 48 48 48 Share-based compensation 313 2,239 2,239 Restructuring charges - 1,895 1,895 Crossroads patent litigation costs - 1,054 1,054 Loss on debt extinguishment - - 394 --- --- --- Non-GAAP $57,058 44.6% $7,190 5.6% $5,331 $0.02 $0.02 Computation of basic and diluted net income (loss) per share: GAAP Non-GAAP ---- -------- Net income (loss) $(299) $5,331 Weighted average shares: Basic and diluted 264,003 264,003 Dilutive shares from stock plans - 305 Diluted 264,003 264,308 ======= ======= Nine Months Ended December 31, 2015 ----------------------------------- Gross Margin Gross Loss From Operating Per Share Net Per Share Net Margin Operations Margin Loss, Basic Loss, Diluted Rate Net Loss ------------ ------ ---------- ---------- -------- -------------- -------------- GAAP $149,979 42.1% $(15,872) (4.5)% $(22,281) $(0.09) $(0.09) Non-GAAP Reconciling Items: Amortization of intangibles 233 233 233 Share-based compensation 1,006 7,339 7,339 Restructuring charges - 2,540 2,540 Crossroads patent litigation costs - 2,694 2,694 Loss on debt extinguishment - - 394 --- --- --- Non-GAAP $151,218 42.5% $(3,066) (0.9)% $(9,081) $(0.03) $(0.03) Computation of basic and diluted net loss per share: GAAP Non-GAAP ---- -------- Net loss $(22,281) $(9,081) Weighted average shares: Basic and diluted 261,849 261,849
The non-GAAP financial information set forth in this table is not prepared in accordance with generally accepted accounting principles and may be different from non-GAAP financial information used by other companies.
QUANTUM CORPORATION GAAP TO NON-GAAP RECONCILIATION (In thousands, except per share amounts) (Unaudited) Three Months Ended December 31, 2014 ------------------------------------ Gross Margin Gross Income From Operating Net Income Per Share Net Per Share Net Margin Operations Margin Income, Basic Income, Rate Diluted ------------ ------ ------------ ---------- ---------- -------------- -------------- GAAP $65,067 45.8% $9,602 6.8% $6,931 $0.03 $0.03 Non-GAAP Reconciling Items: Amortization of intangibles 160 160 160 Share-based compensation 362 2,918 2,918 Restructuring charges - 187 187 Proxy contest and related costs - 125 125 Crossroads patent litigation costs - 325 325 Symform expenses, net 30 265 265 --- --- Non-GAAP $65,619 46.2% $13,582 9.6% $10,911 $0.04 $0.04 Computation of basic and diluted net income per share: GAAP Non-GAAP ---- -------- Net income $6,931 $10,911 Interest of dilutive convertible notes 902 902 Income for purposes of computing income per diluted share $7,833 $11,813 ====== ======= Weighted average shares: Basic 255,860 255,860 Dilutive shares from stock plans 4,493 4,493 Dilutive shares from convertible notes 42,502 42,502 Diluted 302,855 302,855 ======= ======= Nine Months Ended December 31, 2014 ----------------------------------- Gross Margin Gross Income From Operating Net Income Per Share Net Per Share Net Margin Operations Margin Income, Basic Income, Rate Diluted ------------ ------ ------------ ---------- ---------- -------------- -------------- GAAP $182,522 45.0% $11,940 2.9% $3,855 $0.02 $0.01 Non-GAAP Reconciling Items: Amortization of intangibles 753 3,537 3,537 Share-based compensation 1,109 8,655 8,655 Restructuring charges - 1,676 1,676 Outsourcing transition costs 126 126 126 Proxy contest and related costs - 972 972 Crossroads patent litigation costs - 744 744 Acquisition expenses - 4 4 Symform expenses, net 50 486 486 --- --- Non-GAAP $184,560 45.5% $28,140 6.9% $20,055 $0.08 $0.08 Computation of basic and diluted net income per share: GAAP Non-GAAP ---- -------- Net income $3,855 $20,055 Interest of dilutive convertible notes - 2,707 Income for purposes of computing income per diluted share $3,855 $22,762 ====== ======= Weighted average shares: Basic 253,773 253,773 Dilutive shares from stock plans 4,034 4,034 Dilutive shares from convertible notes - 42,502 Diluted 257,807 300,309 ======= =======
The non-GAAP financial information set forth in this table is not prepared in accordance with generally accepted accounting principles and may be different from non-GAAP financial information used by other companies.
QUANTUM CORPORATION SELECTED RESULTS EXCLUDING SCALE-OUT STORAGE REVENUE MEGA DEALS (In thousands) (Unaudited) Three Months Ended ------------------ December 31, 2015 December 31, 2014 Change % Change ----------------- ----------------- ------ -------- As Reported Mega Deals (1) Excluding Mega As Reported Mega Deals (1) Excluding Mega Deals Deals ----------- ------------- --------------- ----------- ------------- --------------- Scale-out storage solutions: Product revenue $29,805 $ - $29,805 $22,819 $(3,098) $19,721 $10,084 51% Product and service revenue(2) $35,704 $ - $35,704 $27,162 $(3,098) $24,064 $11,640 48% Nine Months Ended ----------------- December 31, 2015 December 31, 2014 Change % Change ----------------- ----------------- ------ -------- As Reported Mega Deals (1) Excluding Mega As Reported Mega Deals (1) Excluding Mega Deals Deals ----------- ------------- --------------- ----------- ------------- --------------- Scale-out storage solutions: Product revenue $76,548 $(1,452) $75,096 $59,077 $(9,232) $49,845 $25,251 51% Product and service revenue(2) $93,367 $(1,452) $91,915 $70,716 $(9,232) $61,484 $30,431 49%
(1) Mega deals are defined as deals over $1.0 million. Management considers revenue excluding mega deals in its evaluation of the business for decision making. (2) Management considers product and service revenue in its evaluation of the business for decision making and to compare against competitors. Total product and service revenue less total product revenue equals service revenue in our GAAP results.
QUANTUM CORPORATION FORECAST FOURTH QUARTER FISCAL 2016 GAAP TO NON-GAAP RECONCILIATION (In thousands, except per share amounts) (Unaudited) Percentage Range ---------------- Forecast gross margin rate on a GAAP basis 42.7% - 43.8% Forecast share- based compensation 0.2% - 0.3% --- --- Forecast gross margin rate on a non-GAAP basis 43.0% - 44.0% ==== === ==== Dollar Range ------------ Forecast operating expense on a GAAP basis $50.0 - $51.0 Forecast share- based compensation (2.0) Forecast operating expense on a non-GAAP basis $48.0 - $49.0 ===== === ===== Dollars per Share ----------------- Forecast diluted earnings per share on a GAAP basis $(0.01) - $0.00 Forecast share- based compensation 0.01 Forecast diluted earnings per share on a non- GAAP basis $0.00 - $0.01 ===== === =====
Estimates based on current (January 28, 2016) projections. The projected GAAP and non- GAAP financial information set forth in this table represent forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. For risk factors that could impact these projections, see our Annual Report on Form 10-K as filed with the SEC on June 12, 2015. We disclaim any obligation to update information in any forward- looking statement. The non-GAAP financial information set forth in this table is not prepared in accordance with generally accepted accounting principles and may be different from non-GAAP financial information used by other companies.
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SOURCE Quantum Corp.