Tessera Technologies Posts 2nd Quarter 2014 Results [Professional Services Close - Up]
(Professional Services Close - Up Via Acquire Media NewsEdge) Tessera Technologies reported financial results for the second quarter of 2014.
According to a release from the Company, total revenue from continuing operations was $37.2 million, which was above the Company's guidance range of $31 to $33 million. GAAP net income for the second quarter of 2014 was $3.8 million, or $0.07 per diluted share. Non-GAAP net income for the second quarter of 2014 was $10.2 million, or $0.19 per diluted share.
"Our second quarter results reflect ongoing progress in collaborating with customers on a technology basis to sell the value of our solutions," said Tom Lacey, chief executive officer of Tessera. "Our operational momentum continued into the third quarter with the signing of multi-year patent and technology license agreements with Micron. These important agreements are emblematic of our long-term strategy and we are excited about the prospect of partnering with such a highly-regarded technology company in the development and commercialization of next-generation semiconductor packaging technologies."
Revenue from continuing operations was $37.2 million in the second quarter of 2014 compared with revenue from continuing operations of $46.6 million in the second quarter of 2013. The $9.4 million decrease was primarily due to $17.6 million greater episodic revenue in the second quarter of 2013 compared with the second quarter of 2014. Episodic revenue, which fluctuates from quarter to quarter, totaled $1.4 million in the second quarter of 2014 compared with $19.0 million in the second quarter of 2013.
Operating expenses were $36.3 million in the second quarter of 2014, compared with $51.3 million in the second quarter of 2013, a decrease of $15.0 million. Selling, general and administrative expenses in the second quarter of 2014 decreased by $7.6 million, or 34 percent, from the second quarter of 2013, driven by reductions in administrative headcount and lower outside service costs. Litigation expense decreased by $7.2 million, or 41 percent, from the second quarter of 2013, as the Company had fewer legal proceedings outstanding in the second quarter of 2014 versus 2013. Research and development expenses increased 28 percent, or $2.2 million, over the prior-year period to $10.1 million, reflecting the Company's continued focus on innovation around its core technologies.
Net income from continuing operations for the second quarter of 2014 was $2.5 million, or $0.05 per diluted share, compared with a net loss from continuing operations for the second quarter of 2013 of $2.5 million, or $(0.05) per basic share.
Non-GAAP net income from continuing operations for the second quarter of 2014 was $10.2 million, or $0.19 per diluted share, compared with non-GAAP net income from continuing operations in the second quarter of 2013 of $7.1 million, or $0.13 per diluted share. Non-GAAP net income/loss from continuing operations is defined as income/loss and operating expenses adjusted for discontinued operations, restructuring and other exit costs, acquired intangible asset amortization, charges for acquired in-process research and development, stock-based compensation expense, impairment charges on long-lived assets and goodwill, and related tax effects.
Net income from discontinued operations in the second quarter of 2014 totaled $1.3 million, or $0.02 per diluted share, compared with a net loss from discontinued operations in the second quarter of 2013 of $13.3 million, or $0.25 per basic share. The $14.6 million reduction in cost is due to the closure of the mems|cam manufacturing business in the first quarter of 2014 and a tax gain in the second quarter of 2014 from a year-to-date true-up on taxes at a lower estimated rate for the year.
Total current assets were $363.0 million as of June 30, a decrease of $29.3 million from December 31, 2013. Cash, cash equivalents and short-term investments were $329.2 million as of June 30, a decrease of $30.3 million from December 31, 2013. The decline in cash and current assets in the first half of the fiscal year is due to common stock repurchases and the payment of dividends, balanced by cash generated from operating activities.
On June 25, $32.4 million was paid to stockholders of record as of June 4, for the special cash dividend of $0.52 per share of common stock that was announced on May 13, and the quarterly cash dividend of $0.10 per share of common stock.
Additionally, on July 28, the Board of Directors approved a regular quarterly dividend of $0.10 per share of common stock, payable on September 23, to shareholders of record on September 2.
During the second quarter of 2014, the Company repurchased 1.4 million shares for an aggregate amount of $31.1 million. These purchases were executed under the Company's stock repurchase program. As of June 30, the Company had $65.4 million remaining under its current repurchase program.
Tessera Technologies and its subsidiaries generate revenue from licensing to manufacturers and other implementers that use the Company's technology in areas such as mobile computing and communications, memory and data storage, and 3-D Integrated Circuit technologies.
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