QTM
$8.10
Quantum
($.01)
(.12%)
Earnings Details
4th Quarter March 2017
Wednesday, May 10, 2017 4:15:00 PM
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Summary

Quantum (QTM) Recent Earnings

Quantum (QTM) reported breakeven results for the 4th Quarter March 2017 on revenue of $120.8 million. The consensus earnings estimate was $0.02 per share on revenue of $123.4 million. Revenue grew 0.7% on a year-over-year basis.

Quantum Corp provides storage, archive and data protection solutions for capturing, sharing, and preserving digital assets over the entire data lifecycle.

Results
Reported Earnings
$0.00
Earnings Whisper
-
Consensus Estimate
$0.02
Reported Revenue
$120.8 Mil
Revenue Estimate
$123.4 Mil
Growth
Earnings Growth
Revenue Growth
Power Rating
Grade
Earnings Release

Quantum Corporation Reports Fiscal Fourth Quarter and Full Year 2017 Results

https://mma.prnewswire.com/media/163323/quantum_corp___logo.jpg

Full Year 2017 Highlights:

-- Total revenue of $505 million, up 6% over fiscal 2016

-- Scale-out tiered storage revenue of $148 million, up 17% year-over-year

-- Data protection revenue of $318 million, up 3% year-over-year

-- GAAP net income of $4 million, an $80 million improvement over fiscal 2016

-- Non-GAAP net income of $16 million, a $19 million improvement over the prior year

-- GAAP earnings per share of $0.11, compared to a loss per share of $2.33 in fiscal 2016

Non-GAAP earnings of $0.46 per diluted share, compared to a loss per share of $0.10 the prior year

/PRNewswire/ -- Quantum Corp. (QTM) today reported results for the fiscal fourth quarter and full year 2017 ended March 31, 2017.

Fiscal Fourth Quarter 2017 Financial Results

(All comparisons are relative to the fiscal fourth quarter 2016 unless otherwise stated.)[1]

-- Total revenue was $120.8 million, up from $120.0 million.

-- Branded revenue was $103.5 million, a 7 percent increase.

Scale-out tiered storage revenue was $31.0 million, compared to $33.1 million, primarily reflecting fewer large deals than the same quarter a year earlier.

Total data protection revenue grew 5 percent to $79.7 million, consisting of $21.5 million in disk backup systems revenue (up 19 percent), $40.2 million in tape automation revenue (down 10 percent overall, with OEM revenue down 45 percent and branded revenue flat) and $18.1 million in devices and media revenue (up 38 percent).

-- Royalty revenue was $10.1 million, compared to $11.0 million.

GAAP operating income was $1.1 million, and non-GAAP operating income was $4.2 million, compared to a loss of $50.1 million and income of $8.2 million, respectively. (Fiscal fourth quarter 2016 results included a non-cash goodwill impairment charge of $55.6 million.)

GAAP net loss was $1.9 million, or $0.06 per diluted share,[2] compared to GAAP net loss of $52.9 million, and non-GAAP net income was $1.6 million, or $0.05 per diluted share, compared to non-GAAP net income of $6.2 million.

Fiscal 2017 Full Year Financial Results

(All comparisons are relative to the fiscal 2016 full year results unless otherwise stated.)

-- Total revenue grew 6 percent to $505.3 million, up from $476.0 million.

-- Branded revenue grew 11 percent to $432.1 million, up from $388.3 million.

Scale-out tiered storage revenue grew 17 percent to $148.4 million, up from $126.5 million.

Total data protection revenue grew 3 percent to $318.2 million, consisting of $84.6 million in disk backup systems revenue (up 16 percent), $172.7 million in tape automation revenue (down 9 percent overall, with OEM revenue down 27 percent and branded revenue down 3 percent) and $60.9 million in devices and media revenue (up 33 percent).

-- Royalty revenue was $38.8 million, compared to $41.2 million.

GAAP operating income was $12.1 million, and non-GAAP operating income was $23.0 million, compared to a loss of $67.8 million and income of $3.9 million, respectively.

GAAP net income was $3.6 million, or $0.11 per diluted share, and non-GAAP net income was $15.8 million, or $0.46 per diluted share, compared to a loss of $76.4 million and $3.3 million, respectively.

"Our solid fourth quarter results closed out a year of strong overall performance and execution," said Jon Gacek, president and CEO of Quantum. "We generated year-over-year growth and significantly improved profitability in a year of ongoing industry disruption. One of the keys to this success was the fact that we grew scale-out tiered storage revenue for the ninth consecutive year, building on our leadership in traditional rich media markets and expanding our footprint in new verticals and use cases. In addition, despite continuing challenges in the data protection market, we turned around this part of our business in fiscal 2017, driving significant growth in disk backup systems and extending our position as the market leader in tape automation. From a product standpoint, we delivered innovative new solutions and features for scale-out tiered storage, disk backup and tape archive, including new ways to leverage flash technology and the cloud. Finally, we secured a large financing package that addresses our November 2017 convertible debt and provides a stable, more flexible capital structure over the next five years. All of this makes us well-positioned for further success in fiscal 2018 and beyond.

"We are also excited about the addition of Adalio Sanchez and Marc Rothman to our board of directors and expect to add the final director in our reconstituted board this month. As soon as the new board is fully in place, we will go through a comprehensive strategic review -- taking a detailed look at the market and its trends, our product and solution capabilities, our sales model, R&D roadmaps, expenses and areas of investment, and capital structure -- and then make decisions on how to take Quantum to the next level and drive increased shareholder value.

"When that process is complete, we will provide guidance for fiscal 2018 and update our strategic direction for the year and beyond. In the meantime, our current expectation is that we will grow total revenue year-over-year in the fiscal first quarter, driven by growth in scale-out tiered storage revenue."

Fiscal Fourth Quarter 2017 and Other Recent Business Highlights

Building on its momentum in video surveillance, Quantum closed the highest number of surveillance deals in a quarter to date, which included its first surveillance sales wins in life sciences use cases. Four additional video management software (VMS) partners were also certified to support the company’s full range of scale-out storage tiers, bringing the total number of VMS partners certified for full tiering to 20 and covering 80 percent of the market. Adding to Quantum’s industry accolades, Milestone Systems -- one of the top VMS providers -- named Quantum "Technology Partner of the Year" for 2016 in the Americas and, for the second consecutive year, "Best Solution Partner" in the Asia Pacific region.

Quantum announced purpose-built 4K video reference architectures that leverage the company’s StorNext?-powered, disk- and flash-based workflow storage systems to maximize 4K stream counts and optimize performance levels in accordance with users’ specific needs. Based on exhaustive testing with real-world metrics, the new reference architectures empower media facilities to make better-informed investments in 4K storage infrastructure.

The company introduced StorNext 6, a major new release of the StorNext platform that provides a unique combination of industry-leading performance and advanced data management features. It is designed to help users overcome the challenges of working with growing volumes of higher-resolution content and enable them to capitalize on the opportunities to re-monetize or re-purpose that content. Features include more efficient and cost-effective ways to meet project performance demands, share and access content across geographically distributed teams, and manage and protect archived content.

Quantum announced a strategic relationship with Veritone Inc., a leader in cognitive analytics. Veritone aiWARE -- a hybrid on-premise and cloud version of Veritone’s best-in-class, cloud-based artificial intelligence platform -- will be offered as an integrated solution with StorNext. This combination will allow users to leverage the power of Veritone’s cognitive analytics -- along with top cognitive engines in areas such as face detection, object recognition and transcription -- to extract new value from their on-premise video and audio content without having to move it to the cloud.

Quantum’s board of directors approved a 1-for-8 reverse stock split of its common stock, which began trading on a split-adjusted basis on April 19, 2017.

The company appointed Adalio Sanchez and Marc Rothman to its board of directors. Sanchez is a 35-year information technology industry veteran who spent most of his career at IBM Corp., including 16 years in senior executive and global general management roles. He is currently president of S Group Advisory LLC, a firm providing expertise and management consulting services. Rothman is executive vice president and chief financial officer at VeriFone Inc., responsible for leading the company’s finance, information technology, and real estate organizations, and has more than 30 years of global finance and merger and acquisition experience.

Conference Call and Audio Webcast Notification

Quantum will hold a conference call today, May 10, 2017, at 2:00 p.m. PDT to discuss its fiscal fourth quarter and full year results. Press and industry analysts are invited to attend in listen-only mode.

Dial-in number: +1 (503) 343-6063 Participant passcode: 13655642 Replay numbers: +1 (855) 859-2056 U.S.; +1 (404) 537-3406 International Replay passcode: 13655642 Replay expiration: Wednesday, May 17, 2017 Webcast site: www.quantum.com/investors

About Quantum

Quantum is a leading expert in scale-out tiered 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. Quantum’s end-to-end, tiered storage foundation enables customers 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 and StorNext are registered 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. Quantum advises caution in reliance on forward-looking statements. Forward-looking statements include, without limitation, our statements relating to: 1) being well-positioned for further success in fiscal 2018 and beyond; 2) adding the final director in our reconstituted board this month; 3) our planned comprehensive strategic review; 4) thereafter providing guidance for fiscal 2018 and updating our strategic direction for the year and beyond; and 5) our current expectation that we will grow total revenue year-over-year in the fiscal first quarter, driven by growth in scale-out tiered storage revenue. All forward-looking statements 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 statement, including unexpected changes in the Company’s business. More detailed information about these risk factors and additional 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 February 2, 2017. 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.

Amortization of Intangible Assets

This includes acquired intangibles such as purchased technology 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, restricted stock units and employee stock purchase plan. 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.

Proxy Contest and Related Costs Proxy contest and related costs are expenses incurred to respond to activities and inquiries of VIEX Capital Advisors, LLC, including their proxy solicitation and settlement agreement. 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.

Gain/(loss) on Debt Extinguishment

The gain/(loss) on debt extinguishment relates to specific actions undertaken during the third and fourth quarters of fiscal 2017. The amount 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.

Amortization of Debt Costs

Amortization of debt costs, included in interest expense, relates to the amortization of fees incurred and paid in connection with the issuance of our debt and convertible notes. Amortization of debt costs is a non-cash expense that is representative of a single transaction which occurred in prior periods. The amount 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 amortization from interest expense 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.

Note 1

In the third quarter of fiscal 2017 Quantum implemented new accounting procedures related to the accounting for costs incurred for third-party service providers. While the resulting adjustments were not material to any previously issued annual or quarterly consolidated financial statements, management concluded that revisions to the periods impacted were warranted. These adjustments have been reflected in the financials provided in this press release. Quantum will provide more detail regarding these adjustments in future SEC filings.

[1] All revenue figures for scale-out tiered storage, data protection, disk backup systems and tape automation in this press release include related service revenue.

[2] All earnings per share figures included in this press release have been adjusted to reflect the reverse stock split, effective April 18, 2017.

Contact: Brad Cohen Public Relations Quantum Corp. +1 (408) 944-4044 brad.cohen@quantum.com

Brinlea Johnson or Allise Furlani Investor Relations The Blueshirt Group +1 (212) 331-8424 or +1 (212) 331-8433 brinlea@blueshirtgroup.com or allise@blueshirtgroup.com

QUANTUM CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
(Unaudited)
March 31, 2017 March 31, 2016*
Assets
Current assets:
Cash and cash equivalents
$
12,958
$
33,870
Restricted cash, current
1,832
2,788
Accounts receivable
116,056
105,959
Manufacturing inventories
27,661
40,614
Service parts inventories
19,849
21,407
Other current assets
9,969
8,007
Total current assets
188,325
212,645
Long-term assets:
Property and equipment
11,186
12,939
Intangible assets
276
451
Restricted cash, long-term
20,000
--
Other long-term assets
5,240
4,565
Total long-term assets
36,702
17,955
$
225,027
$
230,600
Liabilities and Stockholders’ Deficit
Current liabilities:
Accounts payable
$
41,611
$
46,136
Accrued warranty
3,263
3,430
Deferred revenue, current
84,683
88,919
Accrued restructuring charges, current
869
1,621
Long-term debt, current
--
3,000
Convertible subordinated debt, current
62,827
--
Accrued compensation
24,104
22,744
Other accrued liabilities
12,998
13,806
Total current liabilities
230,355
179,656
Long-term liabilities:
Deferred revenue, long-term
37,642
35,427
Accrued restructuring charges, long-term 481
1,116
Long-term debt
65,028
62,709
Convertible subordinated debt, long-term --
69,253
Other long-term liabilities
7,520
8,324
Total long-term liabilities
110,671
176,829
Stockholders’ deficit
(115,999)
(125,885)
$
225,027
$
230,600
* Derived from the March 31, 2016 audited Consolidated Financial Statements.
QUANTUM CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share amounts)
(Unaudited)
Three Months Ended
Twelve Months Ended
March 31, 2017 March 31, 2016
March 31, 2017 March 31, 2016
Revenue:
Product
$
75,301
$
72,769
$
322,212
$
286,217
Service
35,452
36,263
144,335
148,548
Royalty
10,082
10,997
38,798
41,193
Total revenue
120,835
120,029
505,345
475,958
Cost of revenue:
Product
53,399
50,499
231,207
207,139
Service
15,386
15,239
60,714
65,778
Total cost of revenue
68,785
65,738
291,921
272,917
Gross margin
52,050
54,291
213,424
203,041
Operating expenses:
Research and development
11,341
10,862
44,379
48,703
Sales and marketing
25,577
24,875
103,235
108,735
General and administrative
13,937
12,183
51,599
53,793
Restructuring charges (benefits)
101
1,466
2,063
4,006
Goodwill impairment
--
55,613
--
55,613
Total operating expenses
50,956
104,999
201,276
270,850
Income (loss) from operations
1,094
(50,708)
12,148
(67,809)
Other income (expense)
(123)
(597)
562
(191)
Interest expense
(2,496)
(1,513)
(7,912)
(6,817)
Loss on debt extinguishment
7
--
(41)
(394)
Income (loss) before income taxes
(1,518)
(52,818)
4,757
(75,211)
Income tax provision
395
66
1,112
1,183
Net income (loss)
$
(1,913)
$
(52,884)
$
3,645
$
(76,394)
Basic and diluted net income (loss) per share
$
(0.06)
$
(1.59)
$
0.11
$
(2.33)
Diluted net income (loss) per share
$
(0.06)
$
(1.59)
$
0.11
$
(2.33)
Weighted average shares:
Basic
33,957
33,174
33,701
32,841
Diluted
33,957
33,174
34,072
32,841
Included in the above Statements of Operations:
Amortization of intangibles:
Cost of revenue
$
36
$
47
$
175
$
280
36
47
175
280
Share-based compensation:
Cost of revenue
198
235
895
1,241
Research and development
280
335
1,300
1,864
Sales and marketing
495
540
2,255
2,907
General and administrative
601
467
2,248
2,904
1,574
1,577
6,698
8,916
Proxy contest and related costs:
General and administrative
1,301
--
1,744
--
1,301
--
1,744
--
Amortization of debt costs:
Interest expense
429
168
1,202
986
429
168
1,202
986
Crossroads patent litigation costs:
General and administrative
62
213
218
2,907
$
62
$
213
$
218
$
2,907
QUANTUM CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
Twelve Months Ended
March 31, 2017 March 31, 2016
Cash flows from operating activities:
Net income (loss)
$
3,645
$
(76,394)
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Depreciation
5,433
6,410
Amortization of intangible assets
175
280
Amortization and write-off of debt issuance costs
1,373
1,062
Service parts lower of cost or market adjustment
4,960
5,972
Deferred income taxes
--
(85)
Share-based compensation
6,698
8,916
Goodwill impairment
55,613
Changes in assets and liabilities:
Accounts receivable
(10,097)
18,200
Manufacturing inventories
12,931
6,325
Service parts inventories
(4,969)
(780)
Accounts payable
(4,845)
(8,180)
Accrued warranty
(167)
(789)
Deferred revenue
(2,020)
(11,085)
Accrued restructuring charges
(1,387)
(2,109)
Accrued compensation
1,492
(12,712)
Other assets and liabilities
(4,307)
(2,364)
Net cash provided by (used in) operating activities
8,914
(11,720)
Cash flows from investing activities:
Purchases of property and equipment
(1,753)
(3,482)
Change in restricted cash
(20,240)
(139)
Net cash used in investing activities
(21,992)
(3,621)
Cash flows from financing activities:
Borrowings of long-term debt, net
104,914
68,920
Repayments of long-term debt
(106,172)
(3,211)
Repayments of convertible subordinated debt
(6,910)
(83,735)
Payment of taxes due upon vesting of restricted stock
(738)
(3,176)
Proceeds from issuance of common stock
1,020
2,478
Net cash used in financing activities
(7,886)
(18,724)
Effect of exchange rate changes on cash and cash equivalents
52
(13)
Net decrease in cash and cash equivalents
(20,912)
(34,078)
Cash and cash equivalents at beginning of period
33,870
67,948
Cash and cash equivalents at end of period
$
12,958
$
33,870
QUANTUM CORPORATION
GAAP TO NON-GAAP RECONCILIATION
(In thousands, except per share amounts)
(Unaudited)
Three Months Ended March 31, 2017
Gross
Gross
Income
Operating
Net Income
Per Share
Per Share
Margin
Margin
From
Margin
Net Income,
Net Income,
Rate
Operations
Basic
Diluted
GAAP
$
52,050
43.1
%
$
1,094
0.9
%
$
(1,913)
$
(0.06)
$
(0.06)
Non-GAAP Reconciling Items:
Amortization of intangibles
36
36
36
Share-based compensation
198
1,574
1,574
Restructuring charges
--
101
101
Proxy contest and related costs
--
1,301
1,301
Crossroads patent litigation costs --
62
62
Amortization of debt costs
--
--
429
Gain/(loss) on debt extinguishment --
--
(7)
Non-GAAP
$
52,284
43.3
%
$
4,168
3.4
%
$
1,583
$
0.05
$
0.05
Computation of basic and diluted net income per share:
GAAP
Non-GAAP
Net income
$
(1,913)
$
1,583
Interest of dilutive convertible notes
--
--
Gain on debt extinguishment
--
--
Income for purposes of computing income per diluted share
$
(1,913)
$
1,583
Weighted average shares:
Basic
33,957
33,957
Dilutive shares from stock plans
--
530
Dilutive shares from convertible notes
--
--
Diluted
33,957
34,487
Twelve Months Ended March 31, 2017
Gross
Gross
Income
Operating
Net Income
Per Share
Per Share
Margin
Margin
From
Margin
Net Income,
Net Income,
Rate
Operations
Basic
Diluted
GAAP
$
213,424
42.2
%
$
12,148
2.4
%
$
3,645
$
0.11
$
0.11
Non-GAAP Reconciling Items:
Amortization of intangibles
175
175
175
Share-based compensation
895
6,698
6,698
Restructuring charges
--
2,063
2,063
Proxy contest and related costs
--
1,744
1,744
Crossroads patent litigation costs --
218
218
Amortization of debt costs
--
--
1,202
Gain/(loss) on debt extinguishment --
--
41
Non-GAAP
$
214,494
42.4
%
$
23,046
4.6
%
$
15,786
$
0.47
$
0.46
Computation of basic and diluted net income per share:
GAAP
Non-GAAP
Net income
$
3,645
$
15,786
Interest of dilutive convertible notes
--
--
Income (loss) for purposes of computing income (loss) per diluted share
$
3,645
$
15,786
Weighted average shares:
Basic
33,701
33,701
Dilutive shares from stock plans
371
371
Dilutive shares from convertible notes
--
--
Diluted
34,072
34,072

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 March 31, 2016
Gross
Gross
Income
Operating
Net Income
Per Share
Per Share
Margin
Margin
(Loss) From
Margin
(Loss)
Net Income
Net Income
Rate
Operations
(Loss),
(Loss),
Basic
Diluted
GAAP
$
54,291
45.2
%
$
(50,708)
(42.2)%
$
(52,884)
$
(1.59)
$
(1.59)
Non-GAAP Reconciling Items:
Amortization of intangibles
47
47
47
Share-based compensation
235
1,577
1,577
Restructuring charges
--
1,466
1,466
Proxy contest and related costs
--
--
--
Crossroads patent litigation costs --
213
213
Goodwill impairment
--
55,613
55,613
Amortization of debt costs
--
--
168
Gain/(loss) on debt extinguishment --
--
--
Non-GAAP
$
54,573
45.5
%
$
8,208
6.8
%
$
6,200
$
0.19
$
0.18
Computation of basic and diluted net income (loss) per share:
GAAP
Non-GAAP
Net income (loss)
$
(52,884)
$
6,200
Interest of dilutive convertible notes
--
902
Income for purposes of computing income per diluted share
$
(52,884)
$
7,102
Weighted average shares:
Basic
33,174
33,174
Dilutive shares from stock plans
--
68
Dilutive shares from convertible notes
--
5,313
Diluted
33,174
38,555
Twelve Months Ended March 31, 2016
Gross
Gross
Income
Operating
Net Loss
Per Share
Per Share
Margin
Margin
(Loss) From
Margin
Net Loss,
Net Loss,
Rate
Operations
Basic
Diluted
GAAP
$
203,041
42.7
%
$
(67,809)
(14.2)%
$
(76,394)
$
(2.33)
$
(2.33)
Non-GAAP Reconciling Items:
Amortization of intangibles
280
280
280
Share-based compensation
1,241
8,916
8,916
Restructuring charges
--
4,006
4,006
Crossroads patent litigation costs --
2,907
2,907
Goodwill impairment
--
55,613
55,613
Amortization of debt costs
--
--
986
Gain/(loss) on debt extinguishment --
--
394
Non-GAAP
$
204,562
43.0
%
$
3,913
0.8
%
$
(3,292)
$
(0.10)
$
(0.10)
Computation of basic and diluted net loss per share:
GAAP
Non-GAAP
Net loss
$
(76,394)
$
(3,292)
Interest of dilutive convertible notes
--
--
Income for purposes of computing income per diluted share
$
(76,394)
$
(3,292)
Weighted average shares:
Basic and diluted
32,841
32,841
Dilutive shares from stock plans
--
--
Dilutive shares from convertible notes
--
--
Diluted
32,841
32,841

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.

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