Marvell Technology Group Ltd. Reports Preliminary Second Quarter of Fiscal 2016 Financial Results
Preliminary Second Quarter of Fiscal 2016 Financial Highlights (GAAP)
- Revenue: Q2 FY 2016,
$711 Million - GAAP Net Loss: Q2 FY 2016,
$382 Million - GAAP Diluted Loss Per Share: Q2 FY 2016,
$0.74
The Company also announced that the Audit Committee of the Company's Board of Directors is conducting an independent investigation of certain accounting and internal control matters in the second quarter of fiscal 2016. Senior management has cooperated fully with the Audit Committee's investigation, and is fully committed to supporting the Audit Committee in this process.
The investigation consists of a review of certain revenue recognition issues in the second quarter of fiscal 2016 and any associated issues with whether senior management's operating style during the period resulted in an open flow of information and communication to set an appropriate tone for an effective control environment. More specifically, the investigation has focused on the approximately 7 to 8 percent of revenue recognized in the second quarter of fiscal 2016 that, based upon the original customer request date, would have been received and earned in the third quarter of fiscal 2016 and is now no longer available for receipt in that quarter. Such percentage represents an increase over the prior four quarters and is indicative of softening demand for certain of the Company's products. This was particularly the case in the storage end market where, as a result of a weaker global economy and a slow-down in the PC market, the Company saw weaker than expected demand for HDD products as the overall total available market declined. The Audit Committee's investigation to date has revealed no material issues regarding the Company's 2016 second quarter financial results, and the Company believes the investigation will have no material impact on its previously issued financial statements.
The Audit Committee is also reviewing certain aspects of the Company's internal control over financial reporting, including controls for the establishment of reserves for litigation and whether senior management's operating style resulted in an open flow of information and communication to set an appropriate tone for an effective control environment. The Company's review of such internal controls is ongoing and may ultimately affect management's conclusion of the effectiveness of internal control over financial reporting as of the end of the second quarter of fiscal 2016. For these reasons the Company has experienced a delay in the completion of its financial statements, Management's Discussion and Analysis of Financial Condition and Results of Operations and other related components of the Quarterly Report.
At the conclusion of the Audit Committee's investigation,
Forward-Looking Statements under the Private Securities Litigation Reform Act of 1995
This press release contains forward-looking statements within the meaning of the federal securities laws that involve risks and uncertainties, including
About Marvell
As used in this release, the term "
Marvell® and the
Marvell Technology Group Ltd. |
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Condensed Consolidated Statements of Operations |
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(Unaudited) |
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(In thousands, except per share amounts) |
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Three Months Ended |
Six Months Ended |
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August 1, |
May 2, |
August 2, |
August 1, |
August 2, |
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2015 |
2015 |
2014 |
2015 |
2014 |
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Net revenue |
$ 711,326 |
$ 724,288 |
$ 961,545 |
$ 1,435,614 |
$ 1,919,375 |
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Cost of goods sold |
748,346 |
351,153 |
477,741 |
1,099,499 |
971,601 |
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Gross profit (loss) |
(37,020) |
373,135 |
483,804 |
336,115 |
947,774 |
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Operating expenses: |
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Research and development |
296,160 |
280,114 |
294,764 |
576,274 |
590,127 |
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Selling and marketing |
30,841 |
36,174 |
33,949 |
67,015 |
72,307 |
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General and administrative |
33,982 |
41,027 |
31,333 |
75,009 |
61,906 |
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Amortization and write-off of acquired intangible assets |
2,568 |
2,568 |
3,304 |
5,136 |
9,993 |
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Total operating expenses |
363,551 |
359,883 |
363,350 |
723,434 |
734,333 |
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Operating income (loss) |
(400,571) |
13,252 |
120,454 |
(387,319) |
213,441 |
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Interest and other income, net |
6,790 |
5,167 |
12,263 |
11,957 |
14,188 |
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Income (loss) before income taxes |
(393,781) |
18,419 |
132,717 |
(375,362) |
227,629 |
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Provision (benefit) for income taxes |
(11,351) |
4,329 |
(6,153) |
(7,022) |
(10,720) |
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Net income (loss) |
$ (382,430) |
$ 14,090 |
$ 138,870 |
$ (368,340) |
$ 238,349 |
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Basic net income (loss) per share |
$ (0.74) |
$ 0.03 |
$ 0.27 |
$ (0.71) |
$ 0.47 |
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Diluted net income (loss) per share |
$ (0.74) |
$ 0.03 |
$ 0.27 |
$ (0.71) |
$ 0.46 |
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Shares used in computing basic earnings (loss) per share |
516,368 |
516,228 |
511,821 |
516,298 |
508,463 |
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Shares used in computing diluted earnings (loss) per share |
516,368 |
527,167 |
520,269 |
516,298 |
520,510 |
Note:
Cost of goods sold includes a litigation accrual of approximately
The results of operations for the second quarter of fiscal 2016 may change if the Audit Committee's investigation determines that any net revenue was not properly recognized in the second quarter of fiscal 2016 or that any other adjustments are needed to such results, or as a result of review procedures for the quarter.
For further information, contact: |
|
John Spencer Ahn |
Sue Kim |
Investor Relations |
Media Relations |
408-222-7544 |
408-222-1942 |
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