SOURCE: Quantum Corporation

Quantum Corporation

May 07, 2014 16:05 ET

Quantum Corporation Reports Fiscal Fourth Quarter and Full Year 2014 Results

SAN JOSE, CA--(Marketwired - May 7, 2014) - Quantum Corporation (NYSE: QTM)

Fourth Quarter Highlights:

  • Delivered Revenue and Operating Income Performance within Guidance Range
  • Increased StorNext/Lattus Revenue 9% Year-over-Year, Driven by Near-50% Growth in North America and Closing Record Fiscal Year for StorNext Revenue
  • Generated $20 Million in Cash from Operations
  • Ended Quarter with More than $100 Million in Cash, the Highest Level in 4 Years

Quantum Corp. (NYSE: QTM) today reported results for the fiscal fourth quarter and full year 2014 ended March 31, 2014.

Fiscal Fourth Quarter 2014 Results
(All comparisons are relative to the fiscal fourth quarter 2013)

  • Revenue was $128.0 million, within the January guidance range but down 9 percent, primarily due to lower tape automation and DXi® sales.
  • Scale-out storage (StorNext® and Lattus™) revenue grew 9 percent, driven by a nearly 50 percent increase in North America sales.
  • GAAP operating loss was $12.5 million, a slight improvement from a $12.9 million operating loss.
  • GAAP net loss was $14.4 million, or $0.06 per diluted share, compared to a net loss of $15.2 million, or $0.06 per diluted share.
  • Non-GAAP operating loss was $159,000 -- reduced from an operating loss of $3.7 million.
  • Non-GAAP net loss was $2.1 million, an improvement of 65 percent compared to a net loss of $6.0 million.
  • Cash generated from operations was $20 million.

Fiscal Year 2014 Results
(All comparisons are relative to the fiscal year 2013)

  • Revenue was $553.2 million, down 6 percent, due primarily to lower tape automation and DXi sales.
  • Scale-out storage revenue reached a record level, growing 12 percent overall and approximately 50 percent in North America.
  • GAAP net loss was $21.5 million, an improvement of approximately 60 percent from a net loss of $52.2 million.
  • Non-GAAP net income was $13.7 million, up $27.2 million.
  • Cash generated from operations was $35.5 million, compared to $7.7 million.
  • Quantum ended the fiscal year with $101.9 million in total cash and cash equivalents, the highest level in four years.

"We're very pleased with our progress over the past year -- financially, operationally and strategically," said Jon Gacek, president and CEO at Quantum. "We reduced our cost structure and achieved our goal of significantly improving bottom line results and increasing cash flow. We also took a number of actions that successfully drove greater operational and sales effectiveness, including aligning our engineering and product groups to better leverage cross-company strengths and refining our sales model to create greater focus in both key verticals and the broader storage market. Lastly, we enhanced our strategic position and value to customers, introducing a range of new offerings, including: our StorNext 5 platform and related appliances for high-performance, scale-out content storage and collaboration; DXi deduplication and vmPRO™ backup software products for virtual environments; and a Lattus object storage solution data center customers can deploy as a highly scalable, self-healing and self-protecting nearline disk tier -- onsite or as the foundation for a private cloud.

"In this new fiscal year, we will build on our progress through several strategic initiatives that leverage our technology, product and install base strengths and capitalize on the market trends in data protection and scale-out storage -- with the goal of delivering profitable growth in our core business and increased shareholder value."

Fiscal Year 2015 Outlook
For the fiscal first quarter, Quantum expects:

  • Revenue of approximately $125 million to $130 million.
  • GAAP gross margin of 43.3 to 44.3 percent and non-GAAP gross margin of 44 to 45 percent.
  • GAAP operating expenses of approximately $59 million and non-GAAP operating expenses of approximately $54 million.
  • Interest expense of $2.5 million and taxes of $500,000.

For the full fiscal year, Quantum expects:

  • Revenue of approximately $540 million to $550 million.
  • GAAP gross margin of 44.6 to 45.6 percent and non-GAAP gross margin of 45 to 46 percent.
  • GAAP operating expenses of $227 million to $232 million and non-GAAP operating expenses of $215 million to $220 million.
  • Interest expense of $10 million and taxes of $2 million.

Fiscal Fourth Quarter 2014 Business Highlights

  • Quantum announced several new products based on its StorNext 5 platform. These include StorNext Pro Solutions which are specifically designed and optimized to meet today's toughest workflow challenges, thereby enabling greater levels of efficiency for broadcasters and post-production facilities. The initial three Pro Solutions offerings provide high-performance storage for refreshing or enhancing older Apple Xsan environments, meeting new 4K workflow demands and supporting end-to-end content production and library management.
  • Extending its technology leadership in disk-based backup and deduplication, the company launched the DXi4700 appliance. It provides best-in-class scalability (5-135 TB of usable capacity), density and cost per terabyte under a "pay-as-you-grow" model, along with security, performance and value features that make it a particularly good fit in the data center, hosted environments and remote sites.
  • Quantum continued to see increasing market traction in selling StorNext to its data center customers for video storage streamlining. The company turned several small tape library opportunities into $200,000 plus deals incorporating StorNext -- including at one of the largest athletic shoe companies in the world, which needed a better storage solution for all its marketing videos.
  • Capping off a year of numerous industry awards and accolades, Quantum had four products named as finalists in Storage magazine/SearchStorage.com's 2013 Product of the Year Awards, more than any other storage provider. The products -- DXi6800 physical backup and deduplication systems, DXi V4000 virtual backup and deduplication appliances, Scalar i6000 HD tape libraries and Lattus Object Storage solutions -- span a cross section of the company's data protection and scale-out storage portfolios and were recognized for innovation and value.

Conference Call and Audio Webcast Notification
Quantum will hold a conference call today, May 7, 2014, 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: (480) 629-9835 (U.S. & International). Quantum will provide a live audio webcast of the conference call beginning today, May 7, 2014, at 2:00 p.m. PDT. Site for the webcast and related information: www.quantum.com/investors.

About Quantum
Quantum is a leading expert in scale-out storage, archive and data protection, providing solutions for capturing, sharing, transforming 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. With Quantum, customers can Be Certain™ they have the end-to-end storage foundation 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, Be Certain, DXi, StorNext, Lattus, vmPRO and Scalar are either registered trademarks or 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. Specifically, but without limitation, our statement that we will build on our progress through several strategic initiatives that leverage our technology, product and install base strengths and capitalize on the market trends in data protection and scale-out storage -- with the goal of delivering profitable growth in our core business and increased shareholder value, and all of the statements under the Fiscal Year 2015 Outlook heading are forward-looking statements within the meaning of the Safe Harbor. All forward-looking statements in this press release 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 statements. These risks include operational difficulties, unforeseen technical limitations, unexpected changes in market conditions and unanticipated changes in customers' needs or requirements, as well as the risks 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 7, 2014 and in Quantum's Annual Report on Form 10-K filed with the Securities and Exchange Commission on June 7, 2013. Quantum expressly disclaims any obligation to update or alter its forward-looking statements, whether as a result of new information, future events or otherwise.

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 uses 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.

The non-GAAP financial measures used in this press release exclude the impact of amortization of intangibles, share-based compensation, restructuring charges and outsourcing transition costs for the following reasons:

Amortization of Intangible Assets
This includes acquired intangibles such as purchased technology and customer relationships 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 and restricted stock units. 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. As a result, management excludes this item from Quantum's internal operating forecasts and models. 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 valuation 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.

Outsourcing Transition Costs
Outsourcing transition costs are expenses attributable to transitioning our manufacturing to an outsourced model. 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.

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

During fiscal year 2014, Quantum identified errors related to the accounting for rent expense and certain allowances for estimated future price adjustments to customers which impacted prior reporting periods. In addition, the company had previously identified errors related to the accrual for sales commissions that also impacted prior reporting periods. While these errors were not material to any previously issued annual or quarterly consolidated financial statements, management concluded that correcting the errors in fiscal 2014 would be material to the year's consolidated financial statements. Quantum will revise its prior period annual and quarterly consolidated financial statements to correct the errors when next presented in future SEC filings.

In this earnings release, the company has revised the March 31, 2013 Condensed Consolidated Balance Sheet and the Condensed Consolidated Statements of Operations and Cash Flows for the quarter and fiscal year ended March 31, 2013 to record reduced rent expense, additional accounts receivable allowance for future price adjustments and revised sales commission expense. The net impact of the revision was to (a) increase the previously reported net loss for the quarter ended March 31, 2013 by $600,000, (b) reduce the previously reported net loss for the fiscal year ended March 31, 2013 by $200,000 and (c) increase the previously reported accumulated deficit and stockholders' deficit at March 31, 2013 by $800,000.

   
   
QUANTUM CORPORATION  
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS  
(In thousands, except per share amounts)  
(Unaudited)  
                         
    Three Months Ended     Twelve Months Ended  
    March 31,
2014
    March 31,
2013
    March 31,
2014
    March 31,
2013
 
          (Revised) Note 1           (Revised) Note 1  
Revenue:                                
  Product   $ 79,426     $ 92,615     $ 348,318     $ 398,910  
  Service     37,587       36,899       147,199       144,037  
  Royalty     10,955       10,411       57,648       44,492  
    Total revenue     127,968       139,925       553,165       587,439  
Cost of revenue:                                
  Product     55,909       62,633       237,076       267,274  
  Service     19,877       19,708       75,930       79,604  
  Restructuring charges     162       --       539       --  
    Total cost of revenue     75,948       82,341       313,545       346,878  
      Gross margin     52,020       57,584       239,620       240,561  
                                 
  Operating expenses:                                
    Research and development     15,312       17,321       64,375       73,960  
    Sales and marketing     29,194       34,400       118,771       136,873  
    General and administrative     14,120       15,230       57,865       62,017  
    Restructuring charges     6,150       3,569       10,675       10,171  
  Total operating expenses     64,776       70,520       251,686       283,021  
  Gain on sale of assets     267       --       267       --  
      Loss from operations     (12,489 )     (12,936 )     (11,799 )     (42,460 )
                                 
  Other income and expense     505       172       1,296       (216 )
  Interest expense     (2,435 )     (2,446 )     (9,754 )     (8,342 )
      Loss before income taxes     (14,419 )     (15,210 )     (20,257 )     (51,018 )
  Income tax provision     (15 )     (56 )     1,217       1,161  
      Net loss   $ (14,404 )   $ (15,154 )   $ (21,474 )   $ (52,179 )
                                 
                                 
  Basic and diluted net loss per share   $ (0.06 )   $ (0.06 )   $ (0.09 )   $ (0.22 )
                                   
  Weighted average basic and diluted shares     249,593       242,165       247,024       239,855  
                                 
                                 
  Included in the above Statements of Operations:                                
                                   
  Amortization of intangibles:                                
      Cost of revenue   $ 372     $ 368     $ 1,476     $ 3,775  
      Sales and marketing     1,857       1,856       7,426       9,524  
        2,229       2,224       8,902       13,299  
  Share-based compensation:                                
      Cost of revenue     403       550       1,963       2,389  
      Research and development     792       893       3,430       3,665  
      Sales and marketing     949       1,096       4,097       4,699  
      General and administrative     1,047       871       3,969       4,386  
        3,191       3,410       13,459       15,139  
  Outsourcing Transition Costs:                                
      Cost of revenue     598       --       1,550       --  
      598       --       1,550       --  
                                 
Note 1 is presented above, before the Condensed Consolidated Statements of Operations.
 
 
   
   
QUANTUM CORPORATION  
CONDENSED CONSOLIDATED BALANCE SHEETS  
(In thousands)  
(Unaudited)  
             
    March 31, 2014     March 31, 2013*  
          (Revised) Note 1  
Assets            
Current assets:                
  Cash and cash equivalents   $ 99,125     $ 68,976  
  Restricted cash     2,760       3,023  
  Accounts receivable     101,605       96,835  
  Manufacturing inventories     34,815       53,075  
  Service parts inventories     25,629       35,368  
  Other current assets     10,624       11,831  
    Total current assets     274,558       269,108  
                 
Long-term assets:                
  Property and equipment     17,574       21,456  
  Intangible assets     3,911       12,813  
  Goodwill     55,613       55,613  
  Other long-term assets     10,605       9,892  
    Total long-term assets     87,703       99,774  
                 
    $ 362,261     $ 368,882  
                 
Liabilities and Stockholders' Deficit                
Current liabilities:                
  Accounts payable   $ 42,255     $ 47,634  
  Accrued warranty     6,116       7,520  
  Deferred revenue, current     98,098       91,108  
  Accrued restructuring charges, current     4,345       3,021  
  Accrued compensation     25,036       30,964  
  Other accrued liabilities     15,168       14,569  
    Total current liabilities     191,018       194,816  
                 
Long-term liabilities:                
  Deferred revenue, long-term     40,054       38,393  
  Accrued restructuring charges, long-term     4,023       1,735  
  Convertible subordinated debt     203,735       205,000  
  Other long-term liabilities     10,831       11,301  
    Total long-term liabilities     258,643       256,429  
                   
  Stockholders' deficit     (87,400 )     (82,363 )
                 
    $ 362,261     $ 368,882  
                 
* Derived from the March 31, 2013 audited Consolidated Financial Statements.
Note 1 is presented above, before the Condensed Consolidated Statements of Operations.
 
 
   
   
QUANTUM CORPORATION  
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS  
(In thousands)  
(Unaudited)  
             
    Twelve Months Ended  
    March 31, 2014     March 31, 2013  
              (Revised) Note 1  
Cash flows from operating activities:                
  Net loss   $ (21,474 )   $ (52,179 )
  Adjustments to reconcile net loss to net cash provided by operating activities:                
    Depreciation     10,713       12,413  
    Amortization     10,536       14,646  
    Service parts lower of cost or market adjustment     11,307       10,081  
    Deferred income taxes     36       (142 )
    Share-based compensation     13,459       15,139  
    Other non-cash gain     983       --  
    Changes in assets and liabilities:                
      Accounts receivable     (4,770 )     11,880  
      Manufacturing inventories     13,352       (2,098 )
      Service parts inventories     2,675       3,735  
      Accounts payable     (5,418 )     (8,630 )
      Accrued warranty     (1,404 )     (66 )
      Deferred revenue     8,651       (370 )
      Accrued restructuring charges     3,619       3,009  
      Accrued compensation     (6,140 )     (1,663 )
      Other assets and liabilities     (651 )     1,980  
Net cash provided by operating activities     35,474       7,735  
                 
Cash flows from investing activities:                
  Purchases of property and equipment     (5,957 )     (10,099 )
  Decrease in restricted cash     426       1,113  
  Purchases of other investments     (1,118 )     (2,169 )
  Return of principal from other investments     --       247  
Net cash used in investing activities     (6,649 )     (10,908 )
                 
Cash flows from financing activities:                
  Repayments of long-term debt     --       (49,495 )
  Borrowings of convertible subordinated debt, net     --       67,701  
  Repayments of convertible subordinated debt     (1,265 )     --  
  Payment of taxes due upon vesting of restricted stock     (1,880 )     (2,036 )
  Proceeds from issuance of common stock     4,430       4,805  
Net cash provided by financing activities     1,285       20,975  
                 
Effect of exchange rate changes on cash and cash equivalents     39       (87 )
                 
Net increase in cash and cash equivalents     30,149       17,715  
Cash and cash equivalents at beginning of period     68,976       51,261  
Cash and cash equivalents at end of period   $ 99,125     $ 68,976  
                 
Note 1 is presented above, before the Condensed Consolidated Statements of Operations.
 
 
 
 
QUANTUM CORPORATION
GAAP TO NON-GAAP RECONCILIATION
(In thousands, except per share amounts)
(Unaudited)
                                       
                                       
    Three Months Ended March 31, 2014
    Gross Margin   Gross Margin Rate   Loss From Operations     Operating Margin   Net Loss     Per Share Net Loss, Basic     Per Share Net Loss, Diluted    
GAAP   $ 52,020   40.7%   $ (12,489 )   (9.8)%   $ (14,404 )   $ (0.06 )   $ (0.06 )  
Non-GAAP Reconciling Items:                                                
  Amortization of intangibles     372         2,229           2,229                    
  Share-based compensation     403         3,191           3,191                    
  Restructuring charges     162         6,312           6,312                    
  Outsourcing transition costs     598         598           598                    
Non-GAAP   $ 53,555   41.9%   $ (159 )   (0.1)%   $ (2,074 )   $ (0.01 )   $ (0.01 ) *
                 
    Computation of basic and diluted net loss per share:   GAAP     Non-GAAP  
      Net loss   $ (14,404 )   $ (2,074 )
                     
    Weighted average shares:                
      Basic and diluted     249,593       249,593  
                       
     
    Twelve Months Ended March 31, 2014
    Gross Margin   Gross Margin Rate   Income (Loss) From Operations     Operating Margin   Net Income (Loss)     Per Share Net Income (Loss), Basic     Per Share Net Income (Loss), Diluted    
GAAP   $ 239,620   43.3%   $ (11,799 )   (2.1)%   $ (21,474 )   $ (0.09 )   $ (0.09 )  
Non-GAAP Reconciling Items:                                                
  Amortization of intangibles     1,476         8,902           8,902                    
  Share-based compensation     1,963         13,459           13,459                    
  Restructuring charges     539         11,214           11,214                    
  Outsourcing transition costs     1,550         1,550           1,550                    
Non-GAAP   $ 245,148   44.3%   $ 23,326     4.2%   $ 13,651     $ 0.06     $ 0.05   *
               
    Computation of basic and diluted net income (loss) per share:   GAAP     Non-GAAP
      Net income (loss)   $ (21,474 )   $ 13,651
        Interest on dilutive convertible notes     --       --
      Income (loss) for purposes of computing income (loss) per diluted share   $ (21,474 )   $ 13,651
                   
    Weighted average shares:              
      Basic     247,024       247,024
        Dilutive shares from stock plans     --       3,004
        Dilutive shares from convertible notes     --       --
      Diluted     247,024       250,028
 
* Non-GAAP per share net income (loss): Each fiscal period is calculated independently, thus the sum of each of the quarter's non-GAAP per share net income (loss) does not necessarily equal the year-to-date non-GAAP per share net income (loss). For example, certain convertible subordinated notes were dilutive in the first quarter of fiscal 2014 but were anti-dilutive for the year-to-date period.
 
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, 2013    
    (Revised) Note 1    
    Gross Margin   Gross Margin Rate   Loss From Operations     Operating Margin   Net Loss     Per Share Net Loss, Basic     Per Share Net Loss, Diluted    
GAAP   $ 57,584   41.2%   $ (12,936 )   (9.2)%   $ (15,154 )   $ (0.06 )   $ (0.06 )  
Non-GAAP Reconciling Items:                                                
  Amortization of intangibles     368         2,224           2,224                    
  Share-based compensation     550         3,410           3,410                    
  Restructuring charges     --         3,569           3,569                    
Non-GAAP   $ 58,502   41.8%   $ (3,733 )   (2.7)%   $ (5,951 )   $ (0.03 )   $ (0.03 ) *
                 
    Computation of basic and diluted net loss per share:   GAAP     Non-GAAP  
      Net loss   $ (15,154 )   $ (5,951 )
                     
    Weighted average shares:                
      Basic and diluted     242,165       242,165  
                       
     
    Twelve Months Ended March 31, 2013
    (Revised) Note 1
    Gross Margin   Gross Margin Rate   Loss From Operations     Operating Margin   Net Loss     Per Share Net Loss, Basic     Per Share Net Loss, Diluted    
GAAP   $ 240,561   41.0%   $ (42,460 )   (7.2)%   $ (52,179 )   $ (0.22 )   $ (0.22 )  
Non-GAAP Reconciling Items:                                                
  Amortization of intangibles     3,775         13,299           13,299                    
  Share-based compensation     2,389         15,139           15,139                    
  Restructuring charges     --         10,171           10,171                    
Non-GAAP   $ 246,725   42.0%   $ (3,851 )   (0.7)%   $ (13,570 )   $ (0.06 )   $ (0.06 ) *
                 
    Computation of basic and diluted net loss per share:   GAAP     Non-GAAP  
      Net loss   $ (52,179 )   $ (13,570 )
                     
    Weighted average shares:                
      Basic and diluted     239,855       239,855  
                       
 
* Non-GAAP per share net income (loss): Each fiscal period is calculated independently, thus the sum of each of the quarter's non-GAAP per share net income (loss) does not necessarily equal the year-to-date non-GAAP per share net income (loss). For example, certain convertible subordinated notes were dilutive in the third quarter of fiscal 2013 but were anti-dilutive for the year-to-date period.
 
Note 1 is presented above, before the Condensed Consolidated Statements of Operations.
 
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
FORECAST FIRST QUARTER AND FISCAL 2015
GAAP TO NON-GAAP RECONCILIATION
(Dollars in millions)
 
         
FORECAST FIRST QUARTER FISCAL 2015
         
    Percentage Range
Forecast first quarter gross margin rate on a GAAP basis   43.3% - 44.3%
Forecast amortization of intangibles   0.3%
Forecast share-based compensation   0.4%
Forecast first quarter gross margin rate on a non-GAAP basis   44.0% - 45.0%
         
         
    Dollars
Forecast first quarter operating expense on a GAAP basis*   $58.6
Forecast amortization of intangibles   1.9
Forecast share-based compensation   2.7
Forecast first quarter operating expense on a non-GAAP basis   $54.0
         
         
FORECAST FULL YEAR FISCAL 2015
         
         
    Percentage Range
Forecast fiscal 2015 gross margin rate on a GAAP basis   44.6% - 45.6%
Forecast amortization of intangibles   0.2%
Forecast share-based compensation   0.2%
Forecast fiscal 2015 gross margin rate on a non-GAAP basis   45.0% - 46.0%
         
         
    Dollar Range
Forecast fiscal 2015 operating expense on a GAAP basis*   $227.4 - $232.4
Forecast amortization of intangibles   2.8
Forecast share-based compensation   9.6
Forecast fiscal 2015 operating expense on a non-GAAP basis   $215.0 - $220.0
         
 
* Forecast first quarter and fiscal year 2015 GAAP operating expense does not reflect facility restructuring charges. These charges will be recognized when we vacate the various locations, which may occur in the first quarter of fiscal 2015 or a later period in fiscal 2015.
 
Estimates based on current (May 7, 2014) projections.
 
The projected GAAP and non-GAAP financial information set forth in this table represent forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. For risk factors that could impact these projections, see our Annual Report on Form 10-K as filed with the SEC on June 7, 2013. We disclaim any obligation to update information in any forward-looking statement.
 
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.
 
 

Contact Information

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

    Brinlea Johnson or Allise Furlani
    Investor Relations
    The Blueshirt Group
    (212) 331-8424 or (212) 331-8433
    ir@quantum.com