<< Back
Ambarella, Inc. Announces Second Quarter Fiscal 2016 Financial Results

SANTA CLARA, Calif., Sept. 1, 2015 (GLOBE NEWSWIRE) -- Ambarella, Inc. (NASDAQ:AMBA), a leading developer of low-power, HD video compression and image processing semiconductors, today announced financial results for its second fiscal quarter ended July 31, 2015.

  • Revenue for the second quarter of fiscal 2016 was $84.2 million, up 79.3% from $47.0 million in the same period in fiscal 2015. For the six months ended July 31, 2015, revenue was $155.2 million, up 76.6% from $87.9 million for the six months ended July 31, 2014.
  • Gross margin under U.S. generally accepted accounting principles (GAAP) for the second quarter of fiscal 2016 was 65.1%, compared with 65.0% for the same period in fiscal 2015. For the six months ended July 31, 2015, GAAP gross margin was 64.9%, compared with 63.9% for the six months ended July 31, 2014.
  • GAAP net income for the second quarter of fiscal 2016 was $23.1 million, or $0.68 per diluted ordinary share, compared with GAAP net income of $9.3 million, or $0.29 per diluted ordinary share, for the same period in fiscal 2015. GAAP net income for the six months ended July 31, 2015 was $42.0 million, or $1.25 per diluted ordinary share. This compares with GAAP net income of $14.6 million, or $0.46 per diluted ordinary share, for the six months ended July 31, 2014.

Financial results on a non-GAAP basis for the second fiscal quarter ended July 31, 2015 are as follows:

  • Gross margin on a non-GAAP basis for the second quarter of fiscal 2016 was 65.3%, compared with 65.1% for the same period in fiscal 2015. For the six months ended July 31, 2015, non-GAAP gross margin was 65.1 %, compared with 64.0% for the six months ended July 31, 2014.
  • Non-GAAP net income for the second quarter of fiscal 2016 was $29.7 million, or $0.88 per diluted ordinary share. This compares with non-GAAP net income of $11.9 million, or $0.37 per diluted ordinary share, for the same period in fiscal 2015. Non-GAAP net income for the six months ended July 31, 2015 was $53.4 million, or $1.58 per diluted ordinary share. This compares with non-GAAP net income of $19.8 million, or $0.62 per diluted ordinary share, for the six months ended July 31, 2014.

Ambarella reports gross margin, net income and earnings per share in accordance with GAAP and, additionally, on a non-GAAP basis. Non-GAAP financial information excludes the impact of stock-based compensation, adjusted for the associated tax impact, and for the second quarter of fiscal 2016 also excludes certain costs associated with the acquisition of VisLab S.r.l. in June 2015. A reconciliation of the GAAP to non-GAAP gross margin, net income and earnings per share numbers, as well as a description of the items excluded from the non-GAAP calculations, is included in the financial statements portion of this press release.

Total cash, cash equivalents and marketable securities on hand at the end of the second fiscal quarter of 2016 was $239.8 million, compared with $166.5 million at the end of the same quarter a year ago.

"We enjoyed a very strong second quarter, with a year-over-year revenue increase of 79.3 percent," said Fermi Wang, president and CEO of Ambarella.  "Revenue from our existing wearable, IP security and automotive video recorder camera markets grew significantly in the quarter, and we saw solid growth from drones or flying cameras.  We also closed on the purchase of VisLab S.r.l., which adds a strong development team as well as advanced intellectual property in computer vision technology.  We look forward to continued success, as Ambarella enables the next generation of intelligent HD and Ultra HD cameras."

Quarterly Conference Call

Ambarella plans to hold a conference call at 5 p.m. Eastern Time / 2 p.m. Pacific Time today with Fermi Wang, Chief Executive Officer, and George Laplante, Chief Financial Officer, to discuss the second quarter results. The call can be accessed by dialing 877-304-8963 in the USA; international callers should dial 760-666-4834. Participant passcode is "Ambarella." Please dial in ten minutes prior to the scheduled conference call time. A live and archived webcast of the call will be available on Ambarella's website at http://www.ambarella.com/ for up to 30 days after the call.

About Ambarella

Ambarella, Inc. (NASDAQ:AMBA), is a leading developer of low-power, high-definition (HD) and Ultra HD video compression and image processing solutions. The company's products are used in a variety of HD cameras including security IP-cameras, sports cameras, wearable cameras, flying cameras and automotive video camera recorders. Ambarella compression chips are also used in broadcasting TV programs worldwide. Ambarella is the recipient of the Global Semiconductor Alliance 2014 Award for "Most Respected Emerging Public Semiconductor Company."

For more information about Ambarella, please visit www.ambarella.com.

"Safe harbor" statement under the Private Securities Litigation Reform Act of 1995

This press release contains forward-looking statements that are not historical facts and often can be identified by terms such as "outlook," "projected," "intends," "will," "estimates," "anticipates," "expects," "believes," "could," or similar expressions, including the comments of our CEO relating to our ability to develop products and the ability of our technology and product features to successfully gain market acceptance and HD and Ultra HD camera design wins. The achievement or success of the matters covered by such forward-looking statements involves risks, uncertainties and assumptions. Our actual results could differ materially from those predicted or implied and reported results should not be considered as an indication of our future performance.

The risks and uncertainties referred to above include, but are not limited to, risks associated with revenue being generated from new customers or design wins, neither of which is assured; our growth strategy; our ability to anticipate future market demands and future needs of our customers; our ability to introduce new and enhanced solutions; our ability to retain and expand customer relationships and to achieve design wins; our ability to successfully enter new markets; anticipated trends and challenges, including competition, in the markets in which we operate; our ability to effectively manage growth; our ability to retain key employees; and the potential for intellectual property disputes or other litigation.

Further information on these and other factors that could affect our financial results is included in the company's Annual Report on Form 10-K for our 2015 fiscal year and Form 10-Q for the quarter ended April 30, 2015, which are on file with the Securities and Exchange Commission. Additional information will also be set forth in the company's quarterly reports on Form 10-Q, annual reports on Form 10-K and other filings the company makes with the Securities and Exchange Commission from time to time, copies of which may be obtained by visiting the Investor Relations portion of our web site at www.ambarella.com or the SEC's web site at www.sec.gov. Undue reliance should not be placed on the forward-looking statements in this release, which are based on information available to us on the date hereof. The results we report in our quarterly report on Form 10-Q for the second fiscal quarter ended July 31, 2015 could differ from the preliminary results announced in this press release.

Ambarella assumes no obligation and does not intend to update the forward-looking statements made in this press release, except as required by law.

Non-GAAP Financial Measures

The company has provided in this release non-GAAP financial information including non-GAAP gross margin, net income, and earnings per share, as a supplement to the condensed consolidated financial statements, which are prepared in accordance with generally accepted accounting principles ("GAAP"). Management uses these non-GAAP financial measures internally in analyzing the company's financial results to assess operational performance and liquidity. The company believes that both management and investors benefit from referring to these non-GAAP financial measures in assessing its performance and when planning, forecasting and analyzing future periods. Further, the company believes these non-GAAP financial measures are useful to investors because they allow for greater transparency with respect to key financial metrics that the company uses in making operating decisions and because the company believes that investors and analysts use them to help assess the health of its business and for comparison to other companies. Non-GAAP results are presented for supplemental informational purposes only for understanding the company's operating results. The non-GAAP information should not be considered a substitute for financial information presented in accordance with GAAP, and may be different from non-GAAP measures used by other companies.

The company has provided below reconciliations between its non-GAAP financial measures to its most directly comparable GAAP financial measures.

         
AMBARELLA, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except share and per share data)
(unaudited)
         
  Three Months Ended July 31, Six Months Ended July 31,
  2015 2014 2015 2014
       
Revenue  $ 84,193  $ 46,968  $ 155,206  $ 87,889
         
Cost of revenue  29,345  16,432  54,440  31,757
Gross profit  54,848  30,536  100,766  56,132
         
Operating expenses:        
Research and development  20,840  13,497  37,423  26,411
Selling, general and administrative  9,087  6,875  18,097  13,630
         
Total operating expenses  29,927  20,372  55,520  40,041
         
Income from operations  24,921  10,164  45,246  16,091
         
Other income  127  39  154  88
         
Income before income taxes  25,048  10,203  45,400  16,179
         
Provision for income taxes  1,951  893  3,449  1,609
         
Net income  $ 23,097  $ 9,310  $ 41,951  $ 14,570
         
Net income per share attributable to ordinary shareholders:        
Basic  $ 0.73  $ 0.32  $ 1.34  $ 0.50
Diluted  $ 0.68  $ 0.29  $ 1.25  $ 0.46
Weighted-average shares used to compute net income per share attributable to ordinary shareholders:        
Basic  31,515,446  29,421,200  31,307,236  29,198,511
Diluted  33,904,222  31,899,501  33,688,239  31,831,489

The following table presents details of stock-based compensation expense included in each functional line item in the condensed consolidated statements of operations above:

         
  Three Months Ended July 31, Six Months Ended July 31,
  2015 2014 2015 2014
  (unaudited, in thousands)
Stock-based compensation:        
Cost of revenue  $ 127  $ 58  $ 251  $ 117
Research and development  3,671  1,629  6,765  3,219
Selling, general and administrative  2,323  1,262  4,587  2,487
         
Total stock-based compensation  $ 6,121  $ 2,949  $ 11,603  $ 5,823
         
AMBARELLA, INC.
RECONCILIATION OF GAAP TO NON-GAAP DILUTED EARNINGS PER SHARE
(in thousands, except share and per share data)
         
  Three Months Ended July 31, Six Months Ended July 31,
  2015 2014 2015 2014
  (unaudited)
GAAP net income  $ 23,097  $ 9,310  $ 41,951  $ 14,570
Two-class method - allocation to participating securities  (2)  (4)
Treasury stock method - additional allocation to ordinary shares
GAAP net income - diluted  $ 23,097  $ 9,308  $ 41,951  $ 14,566
         
Non-GAAP adjustments:        
Stock-based compensation expense, net of tax effect  5,371  2,631  10,178  5,207
Acquisition cost  1,229  1,229
Two-class method - additional allocation to participating securities  (2)
Treasury stock method - additional allocation to ordinary shares 1
Non-GAAP net income - diluted  $ 29,697  $ 11,939  $ 53,358  $ 19,772
         
GAAP - diluted weighted average shares  33,904,222  31,899,501  33,688,239  31,831,489
Non-GAAP - diluted weighted average shares  33,904,222  31,899,501  33,688,239  31,831,489
         
GAAP - diluted net income per share  $ 0.68  $ 0.29  $ 1.25  $ 0.46
Non-GAAP adjustments:        
Stock-based compensation expense, net of tax effect  0.16  0.08  0.30  0.16
Acquisition cost  0.04  0.03
Non-GAAP adjustment to two-class method diluted net income
Non-GAAP adjustment to treasury stock method diluted net income
Non-GAAP - diluted net income per share  $ 0.88  $ 0.37  $ 1.58  $ 0.62

The difference between GAAP and non-GAAP gross margin was 0.2% and 0.1%, or $127,000 and $58,000 for the three months ended July 31, 2015 and 2014, respectively. The difference between GAAP and non-GAAP gross margin was 0.2% and 0.1%, or $251,000 and $117,000 for the six months ended July 31, 2015 and 2014, respectively. The difference was due to the effect of stock-based compensation and the associated tax impact.

     
AMBARELLA, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(unaudited, in thousands)
     
  July 31, January 31,
  2015 2015
     
ASSETS    
Current assets:    
Cash and cash equivalents  $ 199,577  $ 170,291
Marketable securities  40,177  37,703
Accounts receivable, net  42,137  40,180
Inventories  27,773  21,693
Restricted cash  8  8
Deferred tax assets, current  2,019  1,990
Prepaid expenses and other current assets  2,228  3,506
Total current assets  313,919  275,371
     
Property and equipment, net  2,891  3,075
Deferred tax assets, non-current  4,130  3,936
Intangible assets, net  4,107
Goodwill  26,601
Other assets  2,029  1,902
     
Total assets  $ 353,677  $ 284,284
     
LIABILITIES AND SHAREHOLDERS' EQUITY    
Current liabilities:    
Accounts payable  20,314  21,036
Accrued liabilities  24,303  18,699
Income taxes payable  2,939  748
Deferred tax liabilities, current  72  92
Deferred revenue, current  7,078  4,907
Total current liabilities  54,706  45,482
     
Deferred revenue, non-current  94  198
Other long-term liabilities  2,704  1,393
     
Total liabilities  57,504  47,073
     
Shareholders' equity:    
Preference shares
Ordinary shares  14  14
Additional paid-in capital  157,598  140,564
Accumulated other comprehensive loss  (24)  (1)
Retained earnings  138,585  96,634
Total shareholders' equity  296,173  237,211
     
Total liabilities and shareholders' equity  $ 353,677  $ 284,284
CONTACT: Deborah Stapleton

         650.470.4200

         deb@stapleton.com
Source: Ambarella, Inc.

News Provided by Acquire Media