PDFS
$14.20
Pdf Solutions
$.47
3.42%
Earnings Details
2nd Quarter June 2019
Thursday, August 01, 2019 4:00:00 PM
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Summary

Pdf Solutions (PDFS) Recent Earnings

Pdf Solutions (PDFS) reported a 2nd Quarter June 2019 loss of $0.02 per share on revenue of $20.6 million. The consensus estimate was a loss of $0.06 per share on revenue of $20.7 million. Revenue fell 2.6% compared to the same quarter a year ago.

PDF Solutions Inc provides process-design integration technologies. The Company also serves to improve yield and optimize performance of integrated circuits.

Results
Reported Earnings
($0.02)
Earnings Whisper
-
Consensus Estimate
($0.06)
Reported Revenue
$20.6 Mil
Revenue Estimate
$20.7 Mil
Growth
Earnings Growth
Revenue Growth
Power Rating
Grade
Earnings Release

PDF Solutions® Reports Second Fiscal Quarter Results

SANTA CLARA, Calif., Aug. 01, 2019 (GLOBE NEWSWIRE) -- PDF Solutions, Inc. (“PDF Solutions” or the “Company”) (NASDAQ: PDFS), a leading provider of differentiated data and analytics solutions to the semiconductor and electronics industries, today announced financial results for its second fiscal quarter ended June 30, 2019.

Second Fiscal Quarter 2019 Financial Results

Total revenues for the second fiscal quarter of 2019 were $20.6 million, compared to $20.5 million for the first fiscal quarter of 2019 and $21.1 million for the second fiscal quarter of 2018. Solutions revenue for the second fiscal quarter of 2019 was $13.4 million, compared to $16.7 million for the first fiscal quarter of 2019 and $15.3 million for the second fiscal quarter of 2018. Deferred revenue for the second fiscal quarter of 2019 includes $1.0 million associated with one customer in China that is significantly delinquent in payments, which revenue we expect to recognize in the future when such payments are made. Gainshare performance incentives revenue for the second fiscal quarter of 2019 was $7.1 million, compared to $3.9 million for the first fiscal quarter of 2019 and $5.9 million for the second fiscal quarter of 2018.

Second quarter 2019 gross margin of 62% improved from 48% in the second fiscal quarter of 2018, reflecting a lower headcount primarily related to reductions in our yield ramp business as we focus on our software business and an increase in our Gainshare performance incentives.

On a GAAP basis, net loss for the second fiscal quarter of 2019 was $0.7 million, or ($0.02) per basic and diluted share, compared to net loss of $2.7 million, or ($0.08) per basic and diluted share, for the first fiscal quarter of 2019, and compared to net loss of $2.1 million, or ($0.07) per basic and diluted share, for the second fiscal quarter of 2018.

Non-GAAP net income for the second fiscal quarter of 2019 was $1.0 million, or $0.03 per diluted share, compared to net income of $0.8 million, or $0.03 per diluted share, for the first fiscal quarter of 2019, and compared to net income of $0.8 million, or $0.02 per diluted share, for the second fiscal quarter of 2018.

Cash and cash equivalents at June 30, 2019, were $86.8 million, compared to $96.1 million at December 31, 2018, a decrease of $9.3 million. Although operating activities generated $5.0 million in cash during the six months ended June 30, 2019, $10.4 million was used during the same period to repurchase 614,000 shares at an average price of $12.54 per share, for a total of $7.7 million, and to acquire certain assets from StreamMosaic, Inc., a privately held provider of artificial intelligence and machine learning solutions, for approximately $2.7 million. Both the repurchase of shares and the acquisition demonstrate continued commitment to the Company’s on-going evolution to be the provider of choice for advanced data analytics for semiconductors and electronics and expectations of future results based on a successful evolution. 

Operating Highlights

  • Two major Asian pure-play foundries signed contracts to incorporate Exensio® – Control into their new fabs, extending our leadership position in FDC at 300mm. 
  • A leading Asian foundry and a Top-10 semiconductor customer have each renewed and extended contracts for use of our CV® infrastructure to support overall fab management strategy and to provide quality and reliability “screens” for their respective semiconductor manufacturing environments.
  • Three new fabless semiconductor companies with various offerings in the marketplace have each signed deals to adopt our Exensio® Software Platform, validating its scalability from startup fabless to the largest semiconductor companies in the world.
  • Various Top 20 semiconductor customers in the United States and Japan have engaged with us for proof-of-concept projects based on our production-proven machine-learning (ML) capabilities to gain insight into their product quality and quickly identify manufacturing issues.
  • A Top 10 global electronics company has closed a significant deal for Exensio® –Yield™, demonstrating the opportunity for the Exensio® Software Platform in this market segment.

Conference Call

As previously announced, PDF Solutions will discuss these results on a live conference call beginning at 2:00 p.m. Pacific Time/5:00 p.m. Eastern Time today. The call will be simultaneously web cast on PDF Solutions’ website at http://ir.pdf.com/webcasts. A replay of the web cast will be available at the same website address beginning approximately two hours after completion of the live call. A copy of this press release, including the disclosure and reconciliation of certain non-GAAP financial measures to the comparable GAAP measures, which non-GAAP measures may be used periodically by PDF Solutions’ management when discussing financial results with investors and analysts, will also be available on PDF Solutions’ website at http://www.pdf.com/press-releases following the date of this release.

Second Fiscal Quarter 2019 Financial Commentary Available Online

A Management Report reviewing the Company’s second fiscal year 2019 financial results will be furnished to the SEC on Form 8-K and published on the Company’s website at http://ir.pdf.com/financial-reports. Analysts and investors are encouraged to review this commentary prior to participating in the conference call webcast.

Information Regarding Use of Non-GAAP Financial Measures

In addition to providing results that are determined in accordance with Generally Accepted Accounting Principles in the United States of America (GAAP), PDF Solutions also provides certain non-GAAP financial measures. Non-GAAP net income excludes the effects of non-recurring items (including severance payments, and restructuring charges), stock-based compensation expense, amortization of acquired technology and other acquired intangible assets, and their related income tax effects, as applicable, as well as adjusts for the non-cash portion of income taxes. These non-GAAP financial measures are used by management internally to measure the Company’s profitability and performance. PDF Solutions’ management believes that these non-GAAP measures provide useful supplemental information to investors regarding the Company’s ongoing operations in light of the fact that none of these categories of expense has a current effect on the future uses of cash (with the exception of certain non-recurring items) nor do they impact the generation of current or future revenues. These non-GAAP results should not be considered an alternative to, or a substitute for, GAAP financial information, and may differ from similarly titled non-GAAP measures used by other companies. In particular, these non-GAAP financial measures are not a substitute for GAAP measures of income or loss as a measure of performance, or to cash flows from operating, investing and financing activities as a measure of liquidity. Since management uses these non-GAAP financial measures internally to measure profitability and performance, PDF Solutions has included these non-GAAP measures to give investors an opportunity to see the Company’s financial results as viewed by management. A reconciliation of the comparable GAAP financial measures to the non-GAAP financial measures is provided at the end of the Company’s financial statements presented below.   

Forward-Looking Statements

The statements made in this press release and on the planned conference call regarding the Company’s future expected business performance and financial results are forward looking and are subject to future events and circumstances. Actual results could differ materially from those expressed in these forward-looking statements. Risks and uncertainties that could cause results to differ materially include risks associated with: customers’ production volumes under contracts that provide Gainshare royalties, cost and schedule of new product development; continued adoption of the Company’s solutions by new and existing customers; project milestones or delays and performance criteria achieved; the provision of technology and services prior to the execution of a final contract; and other risks set forth in PDF Solutions’ periodic public filings with the Securities and Exchange Commission, including, without limitation, its Annual Reports on Form 10-K, most recently filed for the year ended December 31, 2018, Quarterly Reports on Form 10-Q, and Current Reports on Form 8-K and amendments to such reports. The forward-looking statements made in the conference call are made as of the date hereof, and PDF Solutions does not assume any obligation to update such statements nor the reasons why actual results could differ materially from those projected in such statements.

About PDF Solutions
PDF Solutions (NASDAQ: PDFS) offers an end-to-end analytics platform that empowers engineers and data scientists across the semiconductor ecosystem to rapidly improve the yield, quality, and profitability of their products. By combining industry-leading data analytics and professional services with exclusive, differentiated product data generated during the manufacturing process, PDF Solutions is delivering on the promise of Industry 4.0 today by transforming how the ecosystem collects, analyzes, and shares data. Key Fortune 500 organizations around the world rely on PDF Solutions to remove the data barriers that encumber and constrain new product introductions and to deliver the machine learning insights that drive efficient and profitable high-volume manufacturing.

Headquartered in Santa Clara, California, PDF Solutions also operates worldwide in Canada, China, France, Germany, Italy, Japan, Korea, and Taiwan. For the Company’s latest news and information, visit http://www.pdf.com/.

CV, Exensio, PDF Solutions, and the PDF Solutions logo are registered trademarks of PDF Solutions, Inc. or its subsidiaries. ALPS, DFI, Stream.AI, and StreamMosaic are trademarks of PDF Solutions, Inc. or its subsidiaries.



PDF SOLUTIONS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)
(In thousands)


 

 
 June 30,  December 31, 
  2019  2018 
 

ASSETS
        
Current assets:        
Cash and cash equivalents $86,817  $96,089 
Accounts receivable, net  52,381   51,570 
Prepaid expenses and other current assets  8,843   9,562 
Total current assets  148,041   157,221 
Property and equipment, net  35,846   35,681 
Operating lease right-of-use assets, net  7,974    
Goodwill  2,293   1,923 
Intangible assets, net  6,855   5,064 
Deferred tax assets  21,378   19,044 
Other non-current assets  7,284   6,972 
Total assets $229,671  $225,905 
 

LIABILITIES AND STOCKHOLDERS’ EQUITY
        
Current liabilities:        
Accounts payable $1,813  $2,454 
Accrued compensation and related benefits  5,158   4,727 
Accrued and other current liabilities  2,404   3,235 
Operating lease liabilities - current portion  1,875    
Deferred revenues - current portion  9,026   8,477 
Billings in excess of recognized revenues  1,088   635 
Total current liabilities  21,364   19,528 
Long-term income taxes payable  3,571   3,751 
Non-current operating lease liabilities  8,107    
Other non-current liabilities  1,737   2,831 
Total liabilities  34,779   26,110 
         
Stockholders’ equity:        
Common stock and additional paid-in-capital  318,361   310,665 
Treasury stock at cost  (88,324)  (79,142)
Accumulated deficit  (33,853)  (30,452)
Accumulated other comprehensive loss  (1,292)  (1,276)
Total stockholders’ equity  194,892   199,795 
Total liabilities and stockholders’ equity $229,671  $225,905 

    


PDF SOLUTIONS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
(In thousands, except per share amounts)

  Three months ended  Six months ended 
  June 30,  March 31,  June 30,  June 30,  June 30, 
  2019  2019  2018  2019  2018 
                     
Revenues:                    
Solutions $13,429  $16,661  $15,266  $30,090  $33,456 
Gainshare performance incentives  7,139   3,880   5,853   11,019   12,400 
Total revenues  20,568   20,541   21,119   41,109   45,856 
                     
Cost of Solutions:                    
Direct costs of solutions  7,689   7,723   10,774   15,413   22,112 
Amortization of acquired technology  143   144   143   287   287 
Total cost of solutions  7,832   7,867   10,917   15,700   22,399 
Gross profit  12,736   12,674   10,202   25,409   23,457 
                     
Operating expenses:                    
Research and development  7,312   8,246   7,100   15,558   14,345 
Selling, general and administrative  6,940   7,011   5,919   13,950   12,294 
Amortization of other acquired intangible assets  154   108   108   262   217 
Restructuring charges     92      92    
Total operating expenses  14,406   15,457   13,127   29,862   26,856 
                     
Loss from operations  (1,670)  (2,783)  (2,925)  (4,453)  (3,399)
Interest and other income (expense), net  111   (6)  390   105   59 
Loss before income taxes  (1,559)  (2,789)  (2,535)  (4,348)  (3,340)
Income tax benefit  (849)  (98)  (439)  (947)  (820)
Net loss $(710) $(2,691) $(2,096 $(3,401) $(2,520
                     
Net loss per share:                    
Basic $(0.02) $(0.08) $(0.07 $(0.10) $(0.08
Diluted $(0.02) $(0.08) $(0.07 $(0.10) $(0.08
                     
Weighted average common shares:                    
Basic  32,339   32,485   31,962   32,412   32,065 
Diluted  32,339   34,485   31,962   32,412   32,065 


PDF SOLUTIONS, INC.
RECONCILIATION OF GAAP TO NON-GAAP NET INCOME (UNAUDITED)
(In thousands, except per share amounts)

  Three months ended  Six months ended 
  June 30,  March 31,  June 30,  June 30,  June 30, 
  2019  2019  2018  2019  2018 
GAAP net loss $(710) $(2,691) $(2,096 $(3,401) $(2,520
Adjustments to reconcile GAAP net loss to non-GAAP net income:                    
Stock-based compensation expense  2,434   3,476   2,701   5,910   5,557 
Amortization of acquired technology  143   144   143   287   287 
Amortization of other acquired intangible assets  154   108   108   262   217 
Restructuring charges and severance payments     92      92   283 
Tax impact of adjustments  (993)  (287)  (96)  (1,280)  (843)
Non-GAAP net income $1,028  $842  $760  $1,870  $2,981 
                     
GAAP net loss per diluted share $(0.02) $(0.08) $(0.07 $(0.10) $(0.08
Non-GAAP net income per diluted share $0.03  $0.03  $0.02  $0.06  $0.09 
                     
Shares used in diluted shares calculation  33,055   33,022   32,304   33,038   32,474 


                                                                                                                                                                                 

Company Contacts: 
Christine RussellSonia Segovia
Executive Vice President, Finance and Chief Financial OfficerIR Coordinator
Tel: (408) 938-6466Tel: (408) 938-6491
Email:christine.russell@pdf.comEmail: sonia.segovia@pdf.com

 

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Source: PDF Solutions, Inc.