Telecom Ramblings

PR Archives:  LatestBy Company By Date


Press Release -- August 3rd, 2010
Source: Sonus Networks
Tags: Earnings, Equipment, Exchange

Sonus Networks Reports 2010 Second Quarter Results

SONUS NETWORKS REPORTS 2010 SECOND QUARTER RESULTS

Westford, MA, August 3, 2010 - Sonus Networks, Inc. (NASDAQ:SONS, news, filings), a market leader in next generation IP-based network solutions, today announced results for the quarter ended June 30, 2010.

Revenue for the second quarter of fiscal 2010 was $61.2 million, compared to $62.4 million in the first quarter of fiscal 2010 and $61.6 million for the second quarter of fiscal 2009. The Company's net income on a GAAP basis for the second quarter of fiscal 2010 was $0.3 million, or $0.00 per diluted share, compared to a net loss of $0.1 million, or $0.00 per share, for the first quarter of fiscal 2010, and net income of $4.4 million, or $0.02 per diluted share, for the second quarter of fiscal 2009.

"We are pleased with our solid operating results in the second quarter," said Richard Nottenburg, President and Chief Executive Officer of Sonus Networks. "During the quarter, we successfully launched the NBS-5200 Network Border Switch on our next generation ConnexIP platform and are pleased with the traction we have made to date."

Conference Call Details:
Sonus Networks will host a conference call for analysts and investors to discuss its second quarter 2010 results as well as certain forward-looking information today at 4:45 p.m. ET.

To listen live via telephone:
Dial-in number: 800-671-2810
International Callers: +1 303-223-2684

To listen via internet:
Sonus Networks will host a live webcast of the conference call. To access the webcast, visit www.sonusnet.com, About Us, Investor Relations.

About Sonus Networks
Sonus Networks, Inc. is a leader in IP networking with proven expertise in delivering secure, reliable and scalable next generation infrastructure and subscriber solutions. With customers in over 50 countries across the globe and over a decade of experience in transforming networks to IP, Sonus has enabled service providers and enterprises to capture and retain users and generate significant ROI. Sonus products include media and signaling gateways, policy/routing servers, session border controllers and subscriber feature servers. Sonus products are supported by a global services team with experience in design, deployment and maintenance of some of the world's largest and most complex IP networks. For more information visit www.sonusnet.com.

This release may contain forward-looking statements regarding future events that involve risks and uncertainties. Readers are cautioned that these forward-looking statements are only predictions and may differ materially from actual future events or results. Readers are referred to Item 1A "Risk Factors" of Sonus' Annual Report on Form 10-K for the year ended December 31, 2009, Form 10-Q for the quarter ended March 31, 2010 and Form 10-Q for the quarter ended June 30, 2010, which identify important risk factors that could cause actual results to differ from those contained in the forward-looking statements. Any forward-looking statements represent Sonus' views only as of today and should not be relied upon as representing Sonus' views as of any subsequent date. While Sonus may elect to update forward-looking statements at some point, Sonus specifically disclaims any obligation to do so, except as required by law.

Sonus is a registered trademark of Sonus Networks, Inc. All other company and product names may be trademarks of the respective companies with which they are associated.

For more information, please contact:
Wayne Pastore
978-614-8291
wpastore@sonusnet.com

Fran Murphy
978-614-8148
fmurphy@sonusnet.com

                          SONUS NETWORKS, INC.
            Condensed Consolidated Statements of Operations
                 (in thousands, except per share data)
                              (unaudited)

                                                 Three months ended
                                                 ------------------
                                                       March
                                        June 30,        31,       June 30,
                                            2010         2010         2009
                                            ----         ----         ----
    Revenue:
      Product                            $36,796      $36,278      $36,320
      Service                             24,385       26,130       25,287
                                          ------       ------       ------
        Total revenue                     61,181       62,408       61,607
                                          ------       ------       ------

    Cost of revenue:
      Product                             10,826       12,301       10,747
      Service                             11,842       11,929       10,568
                                          ------       ------       ------
        Total cost of revenue             22,668       24,230       21,315
                                          ------       ------       ------

    Gross profit                          38,513       38,178       40,292
                                          ------       ------       ------

    Gross profit %
      Product                               70.6%        66.1%        70.4%
      Service                               51.4%        54.3%        58.2%
    Total gross profit %                   62.9%        61.2%        65.4%

    Operating expenses:
      Research and development            15,106       14,940       15,501
      Sales and marketing                 12,392       13,594       12,344
      General and administrative          10,971       10,144       10,186
      Restructuring                            -            -           (7)
                                             ---          ---          ---
        Total operating expenses          38,469       38,678       38,024
                                          ------       ------       ------

    Income (loss) from operations             44         (500)       2,268
    Interest expense                         (30)         (13)           8
    Interest income                          466          515        1,077
    Other income, net                          1           10           19
                                             ---          ---          ---

    Income before income taxes               481           12        3,372
    Income tax benefit (provision)          (170)        (146)       1,011
                                            ----         ----        -----

    Net income (loss)                       $311        $(134)      $4,383
                                            ====        =====       ======

    Earnings (loss) per share:
      Basic
      Diluted                                 $-           $-        $0.02
                                              $-           $-        $0.02
    Shares used to compute earnings
     (loss) per share:
      Basic                              275,051      274,701      273,543
      Diluted                            276,314      274,701      273,768

                    SONUS NETWORKS, INC.
       Condensed Consolidated Statements of Operations
            (in thousands, except per share data)
                         (unaudited)

                                          Six months ended
                                          ----------------
                                      June 30,     June 30,
                                          2010          2009
                                          ----          ----
    Revenue:
      Product                          $73,074       $55,723
      Service                           50,515        46,896
                                        ------        ------
        Total revenue                  123,589       102,619
                                       -------       -------

    Cost of revenue:
      Product                           23,127        16,881
      Service                           23,771        22,231
                                        ------        ------
        Total cost of revenue           46,898        39,112
                                        ------        ------

    Gross profit                        76,691        63,507
                                        ------        ------

    Gross profit %
      Product                             68.4%         69.7%
      Service                             52.9%         52.6%
    Total gross profit %                 62.1%         61.9%

    Operating expenses:
      Research and development          30,046        31,854
      Sales and marketing               25,986        24,491
      General and administrative        21,115        20,681
      Restructuring                          -         1,977
                                           ---         -----
        Total operating expenses        77,147        79,003
                                        ------        ------

    Loss from operations                  (456)      (15,496)
    Interest expense                       (43)          (71)
    Interest income                        981         2,726
    Other income, net                       11            12
                                           ---           ---

    Income (loss) before income
     taxes                                 493       (12,829)
    Income tax benefit (provision)        (316)          985
                                          ----           ---

    Net income (loss)                     $177      $(11,844)
                                          ====      ========

    Earnings (loss) per share:
      Basic
      Diluted                               $-        $(0.04)
                                            $-        $(0.04)
    Shares used to compute earnings
     (loss) per share:
      Basic                            274,877       273,320
      Diluted                          276,038       273,320

                    SONUS NETWORKS, INC.
           Condensed Consolidated Balance Sheets
                       (in thousands)
                        (unaudited)

                                                      December
                                       June 30,          31,
                                            2010           2009
                                            ----           ----
                 Assets
    Current assets:
      Cash and cash equivalents         $103,788       $125,323
      Marketable securities              249,393        239,223
      Accounts receivable, net            40,188         47,998
      Inventory, net                      21,181         21,925
      Deferred income taxes                  669            562
      Other current assets                20,394         17,508
                                          ------         ------
        Total current assets             435,613        452,539

    Property and equipment, net           14,355         14,646
    Intangible assets, net                 2,065            341
    Goodwill                               5,053          5,053
    Investments                           66,474         49,598
    Deferred income taxes                    780            711
    Other assets                          22,623         17,849
                                          ------         ------
                                        $546,963       $540,737
                                        ========       ========

     Liabilities and stockholders'
                  equity
    Current liabilities:
      Accounts payable                   $18,619         $5,337
      Accrued expenses                    17,584         19,292
      Current portion of deferred
       revenue                            57,141         74,748
      Current portion of long-term
       liabilities                           484            753
                                             ---            ---
        Total current liabilities         93,828        100,130

    Deferred revenue                      31,703         25,242
    Long-term liabilities                  1,042          1,127
                                           -----          -----
          Total liabilities              126,573        126,499
                                         -------        -------

    Commitments and contingencies

    Stockholders equity:
      Common stock                           278            277
      Additional paid-in capital       1,292,492      1,286,326
      Accumulated deficit               (878,633)      (878,810)
      Accumulated other
       comprehensive income                6,520          6,712
      Treasury stock                        (267)          (267)
                                            ----           ----
          Total stockholders' equity     420,390        414,238
                                         -------        -------
                                        $546,963       $540,737
                                        ========       ========

                            SONUS NETWORKS, INC.
              Condensed Consolidated Statements of Cash Flows
                               (in thousands)
                                (unaudited)

                                                      Six months ended
                                                      ----------------
                                                      June 30,     June 30,
                                                           2010        2009
                                                           ----        ----
    Cash flows from operating activities:
      Net income (loss)                                    $177    $(11,844)
      Adjustments to reconcile net income
       (loss) to cash flows provided by
       operating activities:
        Depreciation and amortization of property
         and equipment                                    4,804       5,004
        Amortization of intangible assets                   276         153
        Stock-based compensation                          5,698       6,750
        Loss on disposal of property and
         equipment                                           59          15
        Deferred income taxes                                 -        (208)
        Changes in operating assets and
         liabilities:
          Accounts receivable                             7,778      37,714
          Inventory                                      (5,201)     (5,204)
          Other operating assets                            261     (13,472)
          Accounts payable                               12,989       1,204
          Accrued expenses                               (1,828)    (11,275)
          Accrued litigation settlements                      -        (100)
          Deferred revenue                              (11,181)      3,645
                                                        -------       -----
            Net cash provided by operating activities    13,832      12,382
                                                         ------      ------

    Cash flows from investing activities:
      Purchases of property and equipment                (4,276)     (3,352)
      Purchase of intangible assets                      (2,000)          -
      Purchases of marketable securities               (168,953)    (61,926)
      Sale/maturities of  marketable
       securities                                       139,620     153,738
      Increase in litigation settlement escrow                -      (9,500)
                                                            ---      ------
            Net cash provided by (used in) investing
             activities                                 (35,609)     78,960
                                                        -------      ------

    Cash flows from financing activities:
      Sale of common stock in connection with
       employee stock purchase plan                         609         529
      Proceeds from exercise of stock options                61           1
      Payment of tax withholding obligations
       related to net share settlements of
       restricted stock awards                             (257)       (287)
      Principal payments of capital lease
       obligations                                         (110)       (124)
                                                           ----        ----
            Net cash provided by financing activities       303         119
                                                            ---         ---

    Effect of exchange rate changes on cash
     and cash equivalents                                   (61)        407
                                                            ---         ---

    Net increase (decrease) in cash and cash
     equivalents                                        (21,535)     91,868
    Cash and cash equivalents, beginning of
     year                                               125,323     122,207
                                                        -------     -------
    Cash and cash equivalents, end of period           $103,788    $214,075
                                                       ========    ========

                                         SONUS NETWORKS, INC.
                                       Supplemental Information
                                            (In thousands)
                                              (unaudited)

    The following tables provide the details of stock-based compensation
    and amortization of intangible assets included in the
    Company's Condensed Consolidated Statements of Operations and the
    line items in which these amounts are reported.  Additional
    information regarding these items is available in the Investor
    Relations section of our website at http://www.sonusnet.com.  The
    information contained on our website or that can be accessed through
    our website should not be considered to be part of, or
    incorporated into, this press release.

                                                    Three months ended
                                                   ------------------
                                            June         March         June
                                             30,          31,           30,
                                             2010          2010         2009
                                             ----          ----         ----
    Stock-based compensation
      Cost of revenue - product               $89           $71         $115
      Cost of revenue - service               404           419          387
                                              ---           ---          ---
        Cost of revenue                       493           490          502
                                              ---           ---          ---

      Research and development
       expense                                665           606        1,102
      Sales and marketing expense             688           729        1,490
      General and administrative
       expense                              1,366           661          616
                                            -----           ---          ---
        Operating expense                   2,719         1,996        3,208
                                            -----         -----        -----

          Total stock-based compensation   $3,212        $2,486       $3,710
                                           ======        ======       ======

    Amortization of intangible
     assets
      Cost of revenue - product               $38           $38          $48
      Research and development                100           100            -
                                              ---           ---          ---
          Total amortization of
           intangible assets                 $138          $138          $48
                                             ====          ====          ===

                                              Six months ended
                                             ----------------
                                            June         June
                                             30,          30,
                                             2010         2009
                                             ----         ----
    Stock-based compensation
      Cost of revenue - product              $160         $231
      Cost of revenue - service               823          852
                                              ---          ---
        Cost of revenue                       983        1,083
                                              ---        -----

      Research and development
       expense                              1,271        1,869
      Sales and marketing expense           1,417        2,534
      General and administrative
       expense                              2,027        1,264
                                            -----        -----
        Operating expense                   4,715        5,667
                                            -----        -----

          Total stock-based compensation   $5,698       $6,750
                                           ======       ======

    Amortization of intangible
     assets
      Cost of revenue - product               $76         $144
      Research and development                200            -
                                              ---          ---
          Total amortization of
           intangible assets                 $276         $144
                                             ====         ====

PR Archives: Latest, By Company, By Date