Ixia Announces Second Quarter 2012 Results
Achieves Record Revenue of $92.3 Million
CALABASAS, CA, July 26, 2012 -- Ixia (Nasdaq:XXIA) today reported its financial results for the second quarter ended June 30, 2012.
Total revenue for the 2012 second quarter was $92.3 million, compared with $69.0 million reported for the 2011 second quarter and $85.6 million reported for the 2012 first quarter. Second quarter 2012 revenue includes approximately $3.9 million attributable to the recently acquired Anue Systems, Inc. for the period following the June 1, 2012 closing date.
On a GAAP basis, the company recorded net income for the 2012 second quarter of $26.9 million, or $0.33 per diluted share, compared with net income of $0.5 million, or $0.01 per diluted share, for the 2011 second quarter. GAAP results for the second quarter of 2012 include a tax benefit of approximately $22.6 million, or $0.27 per diluted share, for the reversal of valuation allowances related to deferred tax assets.
Non-GAAP net income for the 2012 second quarter was a record $14.0 million, or $0.18 per diluted share, compared with non-GAAP net income of $5.8 million, or $0.08 per diluted share, for the 2011 second quarter. Non-GAAP results exclude the above mentioned valuation allowance reversal related to deferred tax assets.
Additional non-GAAP information and a reconciliation of our non-GAAP measures to the most directly comparable GAAP measures for the three and six months ended June 30, 2012 and 2011 may be found in the attached financial tables.
“Our solid second quarter results were driven by healthy demand for our high-speed Ethernet, LTE and Wi-Fi products,” commented Vic Alston, Ixia's president and chief executive officer. “We are very pleased with the momentum of our organic business -- on a standalone basis we generated record revenue and non-GAAP operating profit in the quarter.”
Alston continued, “Over the past three months, with the acquisition of Anue Systems and the pending acquisition of BreakingPoint Systems, we have taken decisive measures to strategically invest in the fast growing network visibility and security markets. We are creating a powerful solution for managing scale, performance and security across networks and applications from the lab into the live network. Looking forward, while there is some uncertainty about the global economic environment in the near term, we believe the combination of Ixia’s strong financial model and these new high-growth addressable markets should deliver positive results to our investors.”
Ixia ended the second quarter with approximately $287 million in cash and investments, compared with $422 million at March 31, 2012. The cash and investments balance at the end of the second quarter 2012, reflects the $152 million purchase price of Anue Systems, Inc. on June 1, 2012.
Conference Call and Webcast Information
Ixia will host a conference call today, at 5:00 p.m., Eastern time, for analysts and investors to discuss its 2012 second quarter results and its business outlook for the 2012 third quarter. Open to the public, investors may access the call by dialing (678) 825-8347. A live webcast of the conference call, along with supplemental financial information, will be accessible from the "Investors" section of Ixia's web site (www.ixiacom.com). Following the live webcast, an archived version will be available in the "Investors" section on the Ixia web site for 90 days.
To supplement our consolidated financial results prepared in accordance with Generally Accepted Accounting Principles ("GAAP"), we have included certain non-GAAP financial measures in this press release and in the attachments hereto. Specifically, we have provided non-GAAP financial measures (e.g., non-GAAP cost of revenues, non-GAAP operating expenses, non-GAAP operating margin, non-GAAP income tax expense, non-GAAP net income, and non-GAAP diluted earnings per share) that exclude certain non-cash and/or non-recurring income and expense items such as proceeds and expenses from certain legal and contractual settlements, stock-based compensation expenses, acquisition and other related costs, the amortization of acquisition-related intangible assets, and the related income tax effects of these items, as well as the income tax impacts of the valuation allowance recorded against certain deferred tax assets. The aforementioned items represent income and expense items that may be difficult to estimate from period to period and/or that we believe are not directly attributable to the underlying performance of our business operations. These non-GAAP financial measures are provided to enhance the user's overall understanding of our financial performance. We believe that by excluding these items, our non-GAAP measures provide supplemental information to both management and investors that is useful in assessing our core operating performance, in evaluating our ongoing business operations and in comparing our results of operations on a consistent basis from period to period. These non-GAAP financial measures are also used by management to plan and forecast future periods and to assist in making operating and strategic decisions. The presentation of this additional information is not prepared in accordance with GAAP. The information therefore may not necessarily be comparable to that of other companies and should be considered as a supplement to, not a substitute for, or superior to, the corresponding measures calculated in accordance with GAAP. Investors are encouraged to review the reconciliations of GAAP to non-GAAP financial measures which are included below in the attached financial tables.
Ixia provides the industry's most comprehensive converged IP network validation and network visibility solutions. Equipment manufacturers, service providers, enterprises, and government agencies use Ixia's solutions to design, verify, and monitor a broad range of wired, Wi-Fi, and 3G/LTE equipment and networks. Ixia's test solutions emulate realistic media-rich traffic and network conditions so that customers can optimize and validate the design, performance, and security of their pre-deployment networks. Ixia's intelligent network visibility platforms provide clarity into physical and virtual production networks for improved performance, security, resiliency, and application delivery of cloud, data center, and service provider networks. For more information, visit www.ixiacom.com.
Safe Harbor Under the Private Securities Litigation Reform Act of 1995:
Certain statements made in this press release are forward-looking statements, including, without limitation, statements regarding the pending acquisition of BreakingPoint Systems, growth, profitability, financial performance and future business. In some cases, such forward-looking statements can be identified by terms such as may, will, should, expect, plan, believe, estimate, predict or the like. Such statements reflect our current intent, belief and expectations and are subject to risks and uncertainties that could cause our actual results to differ materially from those expressed or implied in the forward-looking statements. Factors that may cause future results to differ materially from our current expectations include the risk that the conditions to the closing of our acquisition of BreakingPoint will not be met or that the anticipated benefits and synergies of the proposed acquisition of BreakingPoint or our recent acquisition of Anue Systems, Inc. will not be realized, changes in the global economy, competition, consistency of orders from significant customers, our success in developing and producing new products, market acceptance of our products, war, terrorism, political unrest, natural disasters and other circumstances that could, among other consequences, reduce the demand for our products, disrupt our supply chain and/or impact the delivery of our products. Such factors also include those identified in our Annual Report on Form 10-K for the year ended December 31, 2011, and in our other filings with the U.S. Securities and Exchange Commission. We undertake no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise.
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The Blueshirt Group
Maria Riley 415-217-7722
Tom Miller, Chief Financial Officer
This material is for informational purposes only and subject to change without notice. It describes Ixia's present plans to develop and make available to its customers certain products, features and capabilities. Ixia is only obligated to provide those deliverables specifically included in a written agreement between Ixia and the customer.