UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTIONS 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported): July 22, 2004
AVID TECHNOLOGY, INC.
(Exact Name of Registrant as Specified in Its Charter)
Delaware 0-21174 04-2977748
(State or Other Jurisdiction of (Commission File Number) (I.R.S. Employer
Incorporation or Organization) Identification No.)
Avid Technology Park, One Park West, Tewksbury, MA 01876
(Address of Principal Executive Offices) (zip code)
Registrant's telephone number, including area code: (978) 640-6789
This is Page 1 of 4 pages
Exhibit Index is on Page 4
Item 12. Disclosure of Results of Operations and Financial Condition
On July 22, 2004, the Registrant announced its financial results for the
quarter ended June 30, 2004. The full text of the press release issued in
connection with the announcement is attached as Exhibit 99.1 to this Current
Report on Form 8-K.
The information in this Form 8-K and the Exhibit attached hereto shall
not be deemed "filed" for purposes of the Securities Exchange Act of 1934 (the
"Exchange Act"), nor shall it be deemed incorporated by reference in any filing
under the Securities Act of 1933 or the Exchange Act, except as expressly set
forth by specific reference in such a filing.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Date: July 22, 2004 AVID TECHNOLOGY, INC.
(Registrant)
By: /s/Paul Milbury
----------------
Paul Milbury
Chief Financial Officer
(Principal Financial Officer)
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EXHIBIT INDEX
Exhibit Description
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99.1 Press release of the Registrant dated July 22, 2004.
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Contact: Dean Ridlon, Investor Relations Director
Phone: 978.640.5309
Email: Investor_Relations@avid.com
Avid Reports Record Second Quarter Revenues and Net Income
Tewksbury, MA - July 22, 2004 - Avid Technology, Inc. (NASDAQ: AVID) today
reported record second quarter revenues and net income. Revenues for the three
months ended June 30, 2004 were $139.9 million, a 23% increase over the $113.3
million in the corresponding quarter in 2003. Net income for the quarter nearly
doubled from a year ago and was $15.5 million, or $0.45 per diluted share
compared to net income of $7.8 million, or $0.25 per diluted share, for the
corresponding quarter in 2003.
Net income for the six months ended June 30, 2004 was $30.2 million, or $0.89
per diluted share, on revenues of $267.3 million. This compares to net income of
$13.3 million, or $0.43 per diluted share, on revenues of $225.5 million for the
first half of 2003.
Gross margin for the second quarter was 56.4%, up 1.1 percentage points from the
same quarter last year. As expected, operating expenses rose sequentially to
$63.3 million including costs associated with the company's participation in the
National Association of Broadcasters trade show in April.
"We continue to achieve strong results from each of our segments," said David
Krall, Avid's president and chief executive officer. "Revenues in our video
segment grew by 25% year over year, driven by solid performance in both our
postproduction and broadcast businesses. Our audio segment revenues increased
21% year-over-year, boosted by the initial shipments of the D-Control(TM)
tactile work surface that is part of the Digidesign(R) ICON integrated audio
production environment.
"Avid's strategic plan in digital content creation, management and distribution
is right on track," continued Krall. "We've posted double-digit, year-over-year
revenue growth for the last four quarters, and record revenues for the past two
quarters, and we're looking forward to growing Avid's business in our core
markets and the new areas that we've targeted for expansion."
Conference Call
A conference call to discuss Avid's second quarter 2004 financial results and
the company's outlook for the balance of 2004 will be held today, July 22 at
5:00 p.m. EDT. The call will be open to the public. The conference call can be
accessed by dialing (719) 457-2637 and referencing confirmation code 576792. The
call and subsequent replay will also be available on Avid's Web site. To listen
via this alternative, go to the Investors page under the Company menu at
www.avid.com for complete details 10-15 minutes prior to the start of the
conference call.
The above release includes a forward-looking statement, as defined by the
Private Securities Litigation Reform Act of 1995, about Avid's future
performance. There are a number of factors that could cause actual events or
results to differ materially from that indicated by such forward-looking
statement, such as the competitive market in which Avid operates, market
acceptance of Avid's existing and new products, Avid's ability to anticipate
customers' needs and the other factors set forth under the caption "Certain
Factors That May Affect Future Results" in Avid's Form 10-Q for the quarter
ended March 31, 2004, and other filings with the Securities and Exchange
Commission. In addition, the forward-looking statement contained herein
represents Avid's estimate only as of today and should not be relied upon as
representing the company's estimate as of any subsequent date. While Avid may
elect to update this forward-looking statement at some point in the future, Avid
specifically disclaims any obligation to do so, even if the estimate changes.
About Avid Technology, Inc.
Avid Technology, Inc. is the world leader in digital nonlinear media creation,
management and distribution solutions, enabling film, video, audio, animation,
games, and broadcast professionals to work more efficiently, productively, and
creatively. For more information about the company's Oscar(R), Grammy(R), and
Emmy(R) award-winning products and services, please visit: www.avid.com.
(C) 2004 Avid Technology, Inc. All rights reserved. Avid, D-Control, Digidesign,
Film Composer, and Pro Tools are either registered trademarks or trademarks of
Avid Technology, Inc. in the United States and/or other countries. Avid received
an Oscar statuette representing the 1998 Scientific and Technical Award for the
concept, design, and engineering of the Avid(R) Film Composer(R) system for
motion picture editing. Digidesign, Avid's audio division, received an Oscar
statuette representing the 2003 Scientific and Technical Award for the design,
development, and implementation of its Pro Tools(R) digital audio workstation.
Oscar is a trademark and service mark of the Academy of Motion Picture Arts and
Sciences. Emmy is a registered trademark of ATAS/NATAS. Grammy is a trademark of
the National Academy of Recording Arts and Sciences, Inc. All other trademarks
contained herein are the property of their respective owners.
AVID TECHNOLOGY, INC.
Condensed Consolidated Statements of Operations
(unaudited in thousands, except per share data)
Three Months Ended Six Months Ended
June 30, June 30,
--------- --------- --------- ---------
2004 2003 2004 2003
--------- --------- --------- ---------
Net revenues $139,886 $113,317 $267,260 $225,494
Cost of revenues 60,995 50,608 115,098 102,835
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Gross profit 78,891 62,709 152,162 122,659
--------- --------- --------- ---------
Operating expenses:
Research and development 22,924 21,428 45,216 43,127
Marketing and selling 33,656 27,748 63,510 53,012
General and administrative 6,184 5,617 12,070 10,962
Restructuring and other costs, net 1,783
Amortization of intangible assets 549 341 988 634
--------- --------- --------- ---------
Total operating expenses 63,313 55,134 121,784 109,518
Operating income 15,578 7,575 30,378 13,141
Interest and other income, net 595 507 35 738
--------- --------- --------- ---------
Income before income taxes 16,173 8,082 30,413 13,879
Provision for income taxes 700 300 200 600
--------- --------- --------- ---------
Net income $15,473 $7,782 $30,213 $13,279
========= ========= ========= =========
Net income per common share - basic $0.49 $0.27 $0.96 $0.47
========= ========= ========= =========
Net income per common share - diluted $0.45 $0.25 $0.89 $0.43
========= ========= ========= =========
Weighted average common shares outstanding - basic 31,623 28,494 31,413 28,052
========= ========= ========= =========
Weighted average common shares outstanding - diluted 34,134 31,673 33,912 30,904
========= ========= ========= =========
AVID TECHNOLOGY, INC.
Condensed Consolidated Balance Sheets
(unaudited in thousands)
June 30, December 31,
2004 2003
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ASSETS:
Current assets:
Cash and marketable securities $190,697 $196,309
Accounts receivable, net of allowances of $8,816 and $9,161
at June 30, 2004 and December 31, 2003, respectively 78,702 69,230
Inventories 34,475 38,292
Prepaid and other current assets 13,922 13,181
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Total current assets 317,796 317,012
Property and equipment, net 24,441 23,223
Acquisition-related intangible assets 49,719 5,150
Other assets 5,887 2,734
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Total assets $397,843 $348,119
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LIABILITIES AND STOCKHOLDERS' EQUITY:
Current liabilities:
Accounts payable $19,953 $15,755
Accrued expenses and other current liabilities 55,497 59,709
Deferred revenue and deposits 54,546 44,943
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Total current liabilities 129,996 120,407
Long term liabilities, less current portion 351 607
Total stockholders' equity 267,496 227,105
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Total liabilities and stockholders' equity $397,843 $348,119
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