— Grows Video Products Revenue 60% Year-over-Year
— Awarded strategic new patent for combining echo cancellation and beamforming microphone arrays
SALT LAKE CITY, May 9, 2017 /PRNewswire/ — ClearOne (NASDAQ: CLRO), a global provider of audio and visual communication solutions, reported financial results for the three months ended March 31, 2017.
“2017 is trending positively,” said Zee Hakimoglu, president and chief executive officer. “In the first quarter, our new Converge® Pro 2 platform gained market traction with revenue more than doubling sequentially and contributing to an improved gross margin. Also, video solutions continued to make steady, strong gains with revenue growing 60% over Q1 2016. The combination, despite typical seasonality, fueled sequential total revenue growth of 9%.
“In addition, ClearOne was awarded a new patent on April 25th on a system and method involving the combination of echo cancellation and beamforming microphone arrays. This award, named the ‘186 patent, augments ClearOne’s strong history of product innovation and development of cutting edge technologies. Our investments are powering ClearOne’s industry-leading edge in conferencing technology and delivered the pro-AV industry’s first pro-grade microphone array with beamforming, adaptive steering/smart beam selection, and acoustic echo cancellation, which we believe to be a significant asset in our market. We have initiated a strategy to ensure our intellectual property is respected by the industry, which is consistent with our commitment to build long-term shareholder value,” concluded Hakimoglu.
Financial Summary
The Company uses certain non-GAAP financial measures and reconciles those to GAAP measures in the attached tables.
- Q1 2017 revenue was $11.7 million, compared to $13.0 million in Q1 2016 and $10.7 million in Q4 2016. The year-over-year decrease reflects the continuing transition to the next generation professional audio conferencing platform and the price reductions to corresponding legacy products, and the sequential growth reflects increased contribution from video solutions and Converge Pro 2.
- GAAP gross profit in Q1 2017 was $6.7 million, compared to $8.5 million in Q1 2016 and $5.7 million in Q4 2016. GAAP gross profit margin was 57% in Q1 2017, compared to 65% in Q1 2016 and 53% in Q4 2016. Non-GAAP gross profit margin was 57% in Q1 2017, compared to 65% in Q1 2016 and 55% in Q4 2016. Year-over-year the product mix was still heavily weighted toward the lower margin, legacy Converge Pro 1. Sequentially GAAP gross profit margin improved 4% and non-GAAP improved 2%, reflecting growing adoption of the next generation Converge Pro 2.
- Operating expenses in Q1 2017 were $7.2 million, compared to $6.5 million in Q1 2016 and $6.8 million in Q4 2016. The majority of the increase over Q1 2016 is attributable to litigation, primarily related to the patent lawsuit.
- Net loss in Q1 2017 was $0.5 million, or $0.05 per diluted share, compared to net income of $1.4 million, or $0.14 per diluted share, in Q1 2016 and net loss of $1.1 million, or $0.12 per diluted share, in Q4 2016.
- Non-GAAP net income was $0.1 million, or $0.02 per diluted share, in Q1 2017, compared to $1.8 million, or $0.18 per diluted share, in Q1 2016, and non-GAAP net loss of $0.2 million, or $0.02 per diluted share, in Q4 2016.
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($ in 000, except per share) |
Three months ended March 31, |
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|
2017 |
2016 |
Change |
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|
GAAP |
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|
Revenue |
$ 11,678 |
$ 13,033 |
-10% |
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|
Gross Profit |
6,678 |
8,465 |
-21% |
|||
|
Operating Income (Loss) |
(526) |
1,972 |
-127% |
|||
|
Net Income (Loss) |
(468) |
1,368 |
-134% |
|||
|
Earnings (Loss) Per Share (Diluted) |
(0.05) |
0.14 |
-136% |
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|
Non-GAAP |
||||||
|
Non-GAAP Gross Profit |
$ 6,686 |
$ 8,469 |
-21% |
|||
|
Non-GAAP Operating Income |
366 |
2,520 |
-85% |
|||
|
Non-GAAP Net Income |
149 |
1,755 |
-92% |
|||
|
Non-GAAP Adjusted EBITDA |
634 |
2,774 |
-77% |
|||
|
Non-GAAP Earnings per share (Diluted) |
0.02 |
0.18 |
-89% |
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Continued Investment in Shareholder Value
At March 31, 2017, cash, cash equivalents and investments were $35.6 million, as compared with $38.5 million at December 31, 2016. The Company continued to have no debt. During the Q1 of 2017, the Company paid a cash dividend of $0.05 per share and repurchased approximately 79,000 shares amounting to $0.9 million. As of March 31, 2017, the Company has acquired approximately 621,000 shares amounting to $7.0 million since beginning program in March 2016. The Company intends to continue to repurchase shares of its common stock, and in March 2017 the board renewed and extended the stock repurchase program for up to an additional $10 million in the open market, subject to price, volume and other safe harbor restrictions over the next twelve months.
Conference Call Information
ClearOne senior management will host an investor conference call today, May 9th at 11:30 a.m. Eastern Time to review the company’s financial results. The conference call will be available to interested parties by dialing +1-877-369-6586 (domestic) or +1-253-237-1165 (international). The conference ID is 18924039. The call will also be available through a live, listen-only audio Internet broadcast at http://investors.clearone.com/events.cfm. For those who are not available to listen to the live broadcast, the call will be archived on the same web site for at least three months.
About ClearOne
ClearOne is a global company that designs, develops and sells conferencing, collaboration, and network streaming & signage solutions for voice and visual communications. The performance and simplicity of its advanced comprehensive solutions offer unprecedented levels of functionality, reliability and scalability. More information about the Company can be found at www.clearone.com.