Violin Memory: Fiscal 4Q15 Financial Results

Violin Memory, Inc. announced financial results for the fourth fiscal quarter and full fiscal year ended January 31, 2015.

Fourth Quarter Fiscal 2015 Financial Highlights

• Revenue of $20.5 million
• GAAP gross margin of (50%)
• Non-GAAP gross margin of 50%
• GAAP net loss of $0.50 per share
• Non-GAAP net loss of $0.19 per share

Fiscal Year 2015 Financial Highlights

• Revenue of $79.0 million
• GAAP gross margin of 26%
• Non-GAAP gross margin of 52%
• GAAP net loss of $1.20 per share
• Non-GAAP net loss of $0.84 per share

“We are seeing a rapid transition to our new Flash Storage Platform, affecting fourth quarter revenue as we experienced some related customer timing issues,” said Kevin DeNuccio, president and CEO. “Despite lower than expected revenue, our strong focus on financial management contributed to a bottom line result that exceeded the consensus earnings estimate.”

“Over the last four quarters, we have fundamentally transformed Violin into an agile innovator with the people, technology and financial strength to lead the enterprise migration from disk to flash for primary storage, which represents a $15 billion addressable market. Looking forward, we’re confident in our ability to grow 10% or more on a sequential quarterly basis in fiscal 2016,” added DeNuccio.

Fourth Quarter Fiscal 2015 Financial Results

• Revenue was $20.5 million, 6% lower sequentially compared to $21.7 million reported in the third quarter of fiscal 2015, and 27% lower compared to $28.0 million reported in the fourth quarter of fiscal year 2014.
• Fourth quarter fiscal 2015 GAAP gross margin was (50%) compared to 51% reported in the third quarter of fiscal 2015 and compared to 22% reported in the fourth quarter of fiscal year 2014.
• Non-GAAP gross margin was 50% compared to 54% reported in the third quarter of fiscal 2015 and compared to 56% reported in the fourth quarter of fiscal year 2014
• GAAP net loss was $46.8 million, or $0.50 per share, compared to third quarter fiscal 2015 GAAP net loss of $23.5 million, or $0.25 per share and compared to fourth quarter fiscal 2014 GAAP net loss of $56.5 million, or $0.69 per share.
• GAAP net loss included a net charge of $28.7 million from special items, including inventory provisions due to product transitions of $19.9 million, stock-based compensation expense of $5.3 million, impairment of a cost method investment of $3.5 million and amortization of acquired intangibles of $0.1 million.
• Excluding special items, fnon-GAAP net loss was $18.1 million, or $0.19 per share, compared to third quarter fiscal 2015 non-GAAP net loss of $17.8 million, or $0.19 per share, and compared to fourth quarter fiscal 2014 non-GAAP net loss of $23.5 million, or $0.28 per share.
• Cash and cash equivalents, restricted cash, and short-term investments totaled $156.2 million as of fiscal 2015 year-end.

Fiscal Year 2015 Financial Results

• Revenue was $79.0 million, 27% lower compared to $107.7 million reported for fiscal year 2014.
• GAAP gross margin was 26% compared to 40% reported in fiscal year 2014. Fiscal year 2015 non-GAAP gross margin was 52% compared to 50% reported in fiscal year 2014.
• GAAP net loss was $108.9 million, or $1.20 per share, compared to fiscal year 2014 GAAP net loss of $149.8 million, or $3.88 per share.
• GAAP net loss included a net charge of $32.9 million from special items, including stock-based compensation expense of $23.0 million, inventory provisions due to product transitions of $19.4 million, a gain on the sale of our PCIe product line of $17.4 million, restructuring charges of $3.1 million, impairment of cost method investment of $3.5 million, litigation settlement of $0.7 million, loss on extinguishment of debt of $0.4 million and amortization of acquired intangibles of $0.4 million.
• Excluding special items, non-GAAP net loss was $76.0 million, or $0.84 per share, compared to fiscal year 2014 non-GAAP net loss of $97.9 million, or $2.54 per share.