Harmonic Announces First Quarter 2021 Results

SAN JOSE, Calif., May 3, 2021 /PRNewswire/ -- Harmonic Inc. (NASDAQ: HLIT) today announced its unaudited results for the first quarter of 2021.

Harmonic logo (PRNewsfoto/Harmonic Inc.)

"Harmonic delivered another quarter of solid results, including better than expected revenues and earnings driven by strong customer demand in both of our business segments," said Patrick Harshman, president and chief executive officer of Harmonic. "We saw strong bookings during the first quarter and as a result, we again ended the quarter with near-record backlog and deferred revenue. This solid financial footing, combined with the continued differentiated technology leadership of our video streaming and CableOS® solutions, positions us well for continued success."  

Q1 Financial and Business Highlights

Financial

  • Revenue: $111.6 million, up 42.3% year over year
    • Cable Access segment revenue: $41.3 million, up 72% year over year
    • Video segment revenue: $70.3 million, up 29% year over year
  • Gross margin: GAAP 49.4% and non-GAAP 50.4%, compared to GAAP 46.8% and non-GAAP 48.9% in the year ago period
    • Cable Access segment gross margin: 42.2% compared to 43.3% in the year ago period
    • Video segment gross margin: 55.1% compared to 51.3% in the year ago period
  • Operating income (loss): GAAP loss $3.8 million and non-GAAP income $5.1 million, compared to GAAP loss $18.0 million and non-GAAP loss $9.5 million in the year ago period
  • Adjusted EBITDA: $9.1 million income compared to $7.0 million loss in the year ago period
  • Net income (loss): GAAP net loss $6.1 million and non-GAAP net income of $4.5 million, compared to GAAP net loss $22.0 million and non-GAAP net loss $9.8 million in the year ago period
  • EPS: GAAP net loss per share of $0.06 and non-GAAP net income per share of $0.04, compared to GAAP net loss per share of $0.23 and non-GAAP net loss per share of $0.10 in the year ago period
  • Cash: $100.8 million, up $29.1 million year over year

Business

  • CableOS solution commercially deployed with 53 customers, up 96% year over year
  • CableOS deployments scaled to 3.0 million served cable modems, up 127% year over year
  • 7 new VOS® streaming SaaS customers added during the quarter, total up 72% year over year

Select Financial Information



GAAP


Non-GAAP

Key Financial Results


Q1 2021


Q4 2020


Q1 2020


Q1 2021


Q4 2020


Q1 2020



(in millions, except per share data)

Net revenue


$

111.6



$

131.5



$

78.4



$

111.6



$

131.5



$

78.4


Net income (loss)


$

(6.1)



$

13.5



$

(22.0)



$

4.5



$

20.0



$

(9.8)


Diluted EPS


$

(0.06)



$

0.13



$

(0.23)



$

0.04



$

0.20



$

(0.10)















Other Financial Information

Q1 2021


Q4 2020


Q1 2020


(in millions)

Adjusted EBITDA for the quarter

$

9.1



$

26.4



$

(7.0)


Bookings for the quarter

$

96.3



$

206.4



$

76.3


Backlog and deferred revenue as of quarter end

$

274.3



$

290.5



$

207.9


Cash and cash equivalents as of quarter end

$

100.8



$

98.6



$

71.7


Explanations regarding our use of non-GAAP financial measures and related definitions, and reconciliations of our GAAP and non-GAAP measures, are provided in the sections below entitled "Use of Non-GAAP Financial Measures" and "GAAP to Non-GAAP Reconciliations".

Financial Guidance 


 Q2 GAAP Financial Guidance


Low


High

(Unaudited, in millions, except percentages)

Video


Cable
Access


Adjustments (2)


Total


Video


Cable
Access


Adjustments (2)


Total

Net revenue

$

57.0



$

45.0



$



$

102.0



$

62.0



$

50.0



$



$

112.0


Gross margin %

54.0

%


42.0

%


(0.5)

%


48.2

%


56.0

%


44.0

%


(0.4)

%


50.2

%

Operating expenses

$

34.0



$

18.0



$

4.5



$

56.5



$

35.0



$

19.0



$

4.5



$

58.5


Operating income (loss)

$

(3.2)



$

0.9



$

(5.0)



$

(7.3)



$

(0.3)



$

3.0



$

(5.0)



$

(2.3)


Tax expense (1)







$

(0.7)









$

(0.7)


EPS (1)







$

(0.11)









$

(0.06)


Shares (1)







101.2









101.2


Cash (1)







$

90.0









$

100.0



(1) The guidance is provided at the total company level and not by segment.

(2) See "Use of Non-GAAP Financial Measures" and "GAAP to Non-GAAP Reconciliations" below.

 


 2021 GAAP Financial Guidance


Low


High

(Unaudited, in millions, except percentages)

Video


Cable
Access


Adjustments (2)


Total
GAAP


Video


Cable
Access


Adjustments (2)


Total
GAAP

Net revenue

$

260.0



$

175.0



$



$

435.0



$

280.0



$

200.0



$



$

480.0


Gross margin %

55.0

%


44.0

%


(0.6)

%


50.0

%


57.0

%


45.0

%


(0.5)

%


51.5

%

Operating expenses

$

138.0



$

71.0



$

22.5



$

231.5



$

143.0



$

75.0



$

22.5



$

240.5


Operating income (loss)

$

5.0



$

6.0



$

(25.0)



$

(14.0)



$

16.6



$

15.0



$

(25.0)



$

6.6


Tax expense (1)







$

(2.9)









$

(2.9)


EPS (1)







$

(0.27)









$

(0.06)


Shares (1)







101.4









101.4


Cash (1)







$

110.0









$

120.0



(1) The guidance is provided at the total company level and not by segment.

(2) See "Use of Non-GAAP Financial Measures" and "GAAP to Non-GAAP Reconciliations" below.

 


Q2 2021 Non-GAAP Financial Guidance (2)


Low


High

(Unaudited, in millions, except percentages)

Video


Cable Access


Total


Video


Cable Access


Total

Net revenue

$

57.0



$

45.0



$

102.0



$

62.0



$

50.0



$

112.0


Gross margin %

54.0

%


42.0

%


48.7

%


56.0

%


44.0

%


50.6

%

Operating expenses

$

34.0



$

18.0



$

52.0



$

35.0



$

19.0



$

54.0


Operating income (loss)

$

(3.2)



$

0.9



$

(2.3)



$

(0.3)



$

3.0



$

2.7


Adjusted EBITDA

$

(1.3)



$

2.1



$

0.8



$

1.6



$

4.2



$

5.8


Tax rate (1)





10.0

%






10.0

%

EPS (1)





$

(0.03)







$

0.01


Shares (1)





101.2







104.2


Cash (1)





$

90.0







$

100.0



(1) The guidance is provided at the total company level and not by segment.

(2) See "Use of Non-GAAP Financial Measures" and "GAAP to Non-GAAP Reconciliations" below.

 


 2021 Non-GAAP Financial Guidance (2)


Low


High

(Unaudited, in millions, except percentages)

Video


Cable Access


Total


Video


Cable Access


Total

Net revenue

$

260.0



$

175.0



$

435.0



$

280.0



$

200.0



$

480.0


Gross margin %

55.0

%


44.0

%


50.6

%


57.0

%


45.0

%


52.0

%

Operating expenses

$

138.0



$

71.0



$

209.0



$

143.0



$

75.0



$

218.0


Operating income

$

5.0



$

6.0



$

11.0



$

16.6



$

15.0



$

31.6


Adjusted EBITDA

$

13.5



$

11.6



$

25.1



$

25.1



$

20.6



$

45.7


Tax rate (1)





10.0

%






10.0

%

EPS (1)





$

0.06







$

0.24


Shares (1)





104.7







104.7


Cash (1)





$

110.0







$

120.0



(1) The guidance is provided at the total company level and not by segment.

(2) See "Use of Non-GAAP Financial Measures" and "GAAP to Non-GAAP Reconciliations" below.

 

Conference Call Information

Harmonic will host a conference call to discuss its financial results at 2:00 p.m. Pacific (5:00 p.m. Eastern) on Monday, May 3, 2021. The live webcast will be available on the Harmonic Investor Relations website at http://investor.harmonicinc.com.  An audio version of the webcast will be available by calling +1.574.990.1032 or +1.800.240.9147 (conference ID 8667518). A replay will be available after 5:00 p.m. PT on the same web site or by calling +1.404.537.3406 or +1.855.859.2056 (conference ID 8667518).

About Harmonic Inc.

Harmonic (NASDAQ: HLIT), the worldwide leader in virtualized cable access and video delivery solutions, enables media companies and service providers to deliver ultra-high-quality video streaming and broadcast services to consumers globally. The Company revolutionized cable access networking via the industry's first virtualized cable access solution, enabling cable operators to more flexibly deploy gigabit internet service to consumers' homes and mobile devices. Whether simplifying OTT video delivery via innovative cloud and software platforms, or powering the delivery of gigabit internet cable services, Harmonic is changing the way media companies and service providers monetize live and on-demand content on every screen. More information is available at www.harmonicinc.com.

Legal Notice Regarding Forward-Looking Statements

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, including statements related to our expectations regarding: net revenue, gross margins, operating expenses, operating income (loss), Adjusted EBITDA, tax expense and tax rate, EPS and cash. Our expectations regarding these matters may not materialize, and actual results in future periods are subject to risks and uncertainties that could cause actual results to differ materially from those projected. These risks include, in no particular order, the following: the market and technology trends underlying our Video and Cable Access businesses will not continue to develop in their current direction or pace; the possibility that our products will not generate sales that are commensurate with our expectations or that our cost of revenue or operating expenses may exceed our expectations; the potential impact of the Covid-19 pandemic on our operations or the operations of our supply chain or our customers; the impact of general economic conditions on our sales and operations; the mix of products and services sold in various geographies and the effect it has on gross margins; delays or decreases in capital spending in the cable, satellite, telco, broadcast and media industries; customer concentration and consolidation; our ability to develop new and enhanced products in a timely manner and market acceptance of our new or existing products; losses of one or more key customers; risks associated with our international operations; exchange rate fluctuations of the currencies in which we conduct business; risks associated with our CableOS and VOS product solutions; dependence on various video and broadband industry trends; inventory management; the lack of timely availability or the impact of increases in the prices of parts or raw materials necessary to produce our products; the effect of competition, on both revenue and gross margins; difficulties associated with rapid technological changes in our markets; risks associated with unpredictable sales cycles; our dependence on contract manufacturers and sole or limited source suppliers; and the effect on our business of natural disasters. The forward-looking statements contained in this press release are also subject to other risks and uncertainties, including those more fully described in Harmonic's filings with the Securities and Exchange Commission, including our most recent Annual Report on Form 10-K for the year ended December 31, 2020, our most recent Quarterly Report on Form 10-Q and our Current Reports on Form 8-K. The forward-looking statements in this press release are based on information available to the Company as of the date hereof, and Harmonic disclaims any obligation to update any forward-looking statements.

Use of Non-GAAP Financial Measures

The Company reports its financial results in accordance with accounting principles generally accepted in the United States ("GAAP" or referred to herein as "reported"). However, management believes that certain non-GAAP financial measures provide management and other users with additional meaningful financial information that should be considered when assessing our ongoing performance. Our management regularly uses our supplemental non-GAAP financial measures internally to understand, manage and evaluate our business, establish operating budgets, set internal measurement targets and make operating decisions.

These non-GAAP measures are not in accordance with, or an alternative for, measures prepared in accordance with generally accepted accounting principles and may be different from non-GAAP measures used by other companies. In addition, these non-GAAP measures are not based on any comprehensive set of accounting rules or principles. The Company believes that non-GAAP measures have limitations in that they do not reflect all of the amounts associated with Harmonic's results of operations as determined in accordance with GAAP and that these measures should only be used to evaluate Harmonic's results of operations in conjunction with the corresponding GAAP measures.

The Company believes that the presentation of non-GAAP measures when shown in conjunction with the corresponding GAAP measures, provides useful information to investors and management regarding financial and business trends relating to its financial condition and its historical and projected results of operations. Non-GAAP financial measures should be viewed in addition to, and not as an alternative to, the Company's reported results prepared in accordance with GAAP.

The non-GAAP measures presented here are: segment revenue, gross profit, operating expenses, income (loss) from operations, non-operating expenses and net income (loss) (including those amounts as a percentage of revenue), Adjusted EBITDA and net income (loss) per diluted share. The presentation of non-GAAP information is not intended to be considered in isolation or as a substitute for results prepared in accordance with GAAP, and is not necessarily comparable to non-GAAP results published by other companies. A reconciliation of the historical non-GAAP financial measures discussed in this press release to the most directly comparable historical GAAP financial measures is included with the financial statements provided with this press release. The non-GAAP adjustments described below have historically been excluded from our GAAP financial measures.

Our non-GAAP financial measures reflect adjustments based on the following items, as well as the related income tax effects:

Stock-based compensation - Although stock-based compensation is a key incentive offered to our employees, we continue to evaluate our business performance excluding stock-based compensation expenses. We believe that management is limited in its ability to project the impact stock-based compensation would have on our operating results. In addition, for comparability purposes, we believe it is useful to provide a non-GAAP financial measure that excludes stock-based compensation in order to better understand the long-term performance of our core business and to facilitate the comparison of our results to the results of our peer companies. 

Amortization of intangibles - A portion of the purchase price of our acquisitions is generally allocated to intangible assets, and is subject to amortization. However, Harmonic does not acquire businesses on a predictable cycle. Additionally, the amount of an acquisition's purchase price allocated to intangible assets and the term of its related amortization can vary significantly and is unique to each acquisition. Therefore, we believe that the presentation of non-GAAP financial measures that adjust for the amortization of intangible assets provides investors and others with a consistent basis for comparison across accounting periods. 

Restructuring and related charges - Harmonic from time to time incurs restructuring charges which primarily consist of employee severance, one-time termination benefits related to the reduction of its workforce, lease exit costs, and other costs.  These charges are associated with material business shifts. We exclude these items because we do not believe they are reflective of our ongoing long-term business and operating results. 

Loss on convertible debt extinguishment - In the fourth quarter of fiscal 2020, we recorded a loss of $0.5 million from the conversion and settlement of the remaining $8.1 million of our convertible notes due in December 2020. We have excluded this loss from our non-GAAP financial measures because we do not believe the loss is reflective of our ongoing long-term business and operating results.

Non-cash interest expense and other expenses related to convertible notes and other debt - We record the accretion of the debt discount related to the equity component and amortization of issuance costs as non-cash interest expense. We believe that excluding these costs provides meaningful supplemental information regarding operational performance and liquidity, along with enhancing investors' ability to view the Company's results from management's perspective. In addition, we believe excluding these costs from the non-GAAP measures facilitates comparisons to our historical operating results and comparisons to peer company operating results. 

Discrete tax items and tax effect of non-GAAP adjustments - The income tax effect of non-GAAP adjustments relates to the tax effect of the adjustments that we incorporate into non-GAAP financial measures in order to provide a more meaningful measure of non-GAAP net income.

Depreciation - Depreciation expense, along with interest, tax and stock-based compensation expense, restructuring charges and amortization of intangible assets, is excluded from Adjusted EBITDA because we do not believe depreciation and the other items relate to the ordinary course of our business or are reflective of our underlying business performance.

 

Harmonic Inc.

Preliminary Condensed Consolidated Balance Sheets

(Unaudited, in thousands, except per share data)



April 2, 2021


December 31, 2020

ASSETS




Current assets:




   Cash and cash equivalents

$

100,777



$

98,645


   Accounts receivable, net

85,704



66,227


   Inventories

35,539



35,031


   Prepaid expenses and other current assets

38,647



38,132


Total current assets

260,667



238,035


Property and equipment, net

43,136



43,141


Operating lease right-of-use assets

25,751



27,556


Other non-current assets

38,308



39,117


Goodwill

241,847



243,674


Total assets

$

609,709



$

591,523






LIABILITIES AND STOCKHOLDERS' EQUITY




Current liabilities:




Convertible notes, current

$

36,143



$


Other debts, current

5,405



11,771


Accounts payable

36,148



23,543


Deferred revenue

63,851



54,294


Operating lease liabilities, current

7,032



7,354


Other current liabilities

43,986



50,333


Total current liabilities

192,565



147,295


Convertible notes, non-current

94,884



129,507


Other debts, non-current

15,415



10,086


Operating lease liabilities, non-current

24,548



26,071


Other non-current liabilities

20,963



20,262


Total liabilities

$

348,375



$

333,221






Convertible notes

1,564




Stockholders' equity:




Preferred stock, $0.001 par value, 5,000 shares authorized; no shares issued or outstanding




Common stock, $0.001 par value, 150,000 shares authorized; 100,993 and 98,204 shares issued and outstanding at April 2, 2021 and December 31, 2020, respectively

101



98


Additional paid-in capital

2,365,129



2,353,559


Accumulated deficit

(2,107,335)



(2,101,211)


Accumulated other comprehensive income

1,875



5,856


Total stockholders' equity

259,770



258,302


Total liabilities and stockholders' equity

$

609,709



$

591,523


 

Harmonic Inc.

Preliminary Condensed Consolidated Statements of Operations

(Unaudited, in thousands, except per share data)



Three months ended


April 2, 2021


March 27, 2020

Revenue:




Appliance and integration

$

79,976



$

47,752


SaaS and service

31,600



30,665


Total net revenue

111,576



78,417


Cost of revenue:




Appliance and integration

42,619



26,287


SaaS and service

13,812



15,392


Total cost of revenue

56,431



41,679


Total gross profit

55,145



36,738


Operating expenses:




Research and development

23,528



22,123


Selling, general and administrative

34,911



31,218


Amortization of intangibles

507



770


Restructuring and related charges

43



676


Total operating expenses

58,989



54,787


Loss from operations

(3,844)



(18,049)


Interest expense, net

(2,603)



(2,903)


Other income (expense), net

1,019



(273)


Loss before income taxes

(5,428)



(21,225)


Provision for income taxes

696



729


Net loss

$

(6,124)



$

(21,954)






Net loss per share:




Basic and diluted

$

(0.06)



$

(0.23)


Shares used in per share calculations:




Basic and diluted

99,868



95,575


 

Harmonic Inc.

Preliminary Condensed Consolidated Statements of Cash Flows

(Unaudited, in thousands)



Three months ended


April 2, 2021


March 27, 2020

Cash flows from operating activities:




Net loss

$

(6,124)



$

(21,954)


Adjustments to reconcile net loss to net cash provided by (used in) operating activities:




Depreciation

3,057



2,843


Amortization of intangibles

507



1,655


Stock-based compensation

8,398



6,259


Amortization of convertible debt discount

1,532



1,835


Amortization of warrant

429



434


Foreign currency adjustments

(2,609)



(2,066)


Deferred income taxes

432



653


Provision for doubtful accounts and returns

1,089



331


Provision for excess and obsolete inventories

644



234


Other adjustments

143



121


Changes in operating assets and liabilities:




Accounts receivable

(20,758)



(5,068)


Inventories

(1,119)



(6,281)


Other assets

(1,019)



10,579


Accounts payable

13,527



(242)


Deferred revenues

11,285



12,477


Other liabilities

(7,736)



(12,851)


Net cash provided by (used in) operating activities

1,678



(11,041)


Cash flows from investing activities:




Purchases of property and equipment

(3,645)



(11,224)


Net cash used in investing activities

(3,645)



(11,224)


Cash flows from financing activities:




Payment of convertible debt issuance costs



(35)


Repayment of other debts

(108)



(406)


Proceeds from common stock issued to employees

5,685



3,000


Payment of tax withholding obligations related to net share settlements of restricted stock units

(913)



(829)


Net cash provided by financing activities

4,664



1,730


Effect of exchange rate changes on cash and cash equivalents

(565)



(811)


Net increase (decrease) in cash and cash equivalents

2,132



(21,346)


Cash and cash equivalents at beginning of period

98,645



93,058


Cash and cash equivalents at end of period

$

100,777



$

71,712


 

Harmonic Inc.

Preliminary GAAP Revenue Information

(Unaudited, in thousands, except percentages)



Three months ended


April 2, 2021


December 31, 2020


March 27, 2020

Geography









Americas

$

75,062


68

%


$

84,916


65

%


$

37,650


48

%

EMEA

27,607


24

%


34,825


26

%


27,816


35

%

APAC

8,907


8

%


11,787


9

%


12,951


17

%

Total

$

111,576


100

%


$

131,528


100

%


$

78,417


100

%










Market









Service Provider

$

53,660


48

%


$

66,673


51

%


$

43,759


56

%

Broadcast and Media

57,916


52

%


64,855


49

%


34,658


44

%

Total

$

111,576


100

%


$

131,528


100

%


$

78,417


100

%

 

Harmonic Inc.

Preliminary Segment Information

(Unaudited, in thousands, except percentages)



Three months ended April 2, 2021


Video


Cable Access


Total Segment Measures

(non-GAAP)


Adjustments (1)


Consolidated GAAP Measures

Net revenue

$

70,331



$

41,245



$

111,576



$



$

111,576


Gross profit

38,774



17,408



56,182



(1,037)



55,145


Gross margin %

55.1

%


42.2

%


50.4

%




49.4

%

Operating income (loss)

3,772



1,296



5,068



(8,912)



(3,844)


Operating margin %

5.4

%


3.1

%


4.5

%




(3.4)

%












Three months ended December 31, 2020


Video


Cable Access


Total Segment Measures

(non-GAAP)


Adjustments (1)


Consolidated GAAP Measures

Net revenue

$

86,044



$

45,484



$

131,528



$



$

131,528


Gross profit

48,336



24,437



72,773



(1,211)



71,562


Gross margin %

56.2

%


53.7

%


55.3

%




54.4

%

Operating income (loss)

13,529



9,918



23,447



(6,672)



16,775


Operating margin %

15.7

%


21.8

%


17.8

%




12.8

%












Three months ended March 27, 2020


Video


Cable Access


Total Segment Measures

(non-GAAP)


Adjustments (1)


Consolidated GAAP Measures

Net revenue

$

54,372



$

24,045



$

78,417



$



$

78,417


Gross profit

27,907



10,414



38,321



(1,583)



36,738


Gross margin %

51.3

%


43.3

%


48.9

%




46.8

%

Operating loss

(6,267)



(3,265)



(9,532)



(8,517)



(18,049)


Operating margin %

(11.5)

%


(13.6)

%


(12.2)

%




(23.0)

%


(1) See "Use of Non-GAAP Financial Measures" above and "GAAP to Non-GAAP Reconciliations" below.

 

Harmonic Inc.

GAAP to Non-GAAP Reconciliations (Unaudited)

(in thousands, except percentages and per share data)



Three months ended April 2, 2021


Revenue

Gross Profit

Total
Operating Expense

Income
(Loss) from Operations

Total Non-
operating
expense, net

Net Income (Loss)

GAAP

$

111,576


$

55,145


$

58,989


$

(3,844)


$

(1,584)


$

(6,124)


Stock-based compensation


1,073


(7,325)


8,398



8,398


Amortization of intangibles



(507)


507



507


Restructuring and related charges


(36)


(43)


7



7


Non-cash interest and other expenses related to convertible notes





1,532


1,532


Discrete tax items and tax effect of non-GAAP adjustments






194


Total adjustments


1,037


(7,875)


8,912


1,532


10,638


Non-GAAP

$

111,576


$

56,182


$

51,114


$

5,068


$

(52)


$

4,514


As a % of revenue (GAAP)


49.4

%

52.9

%

(3.4)

%

(1.4)

%

(5.5)

%

As a % of revenue (Non-GAAP)


50.4

%

45.8

%

4.5

%

%

4.0

%

Diluted net income (loss) per share:







GAAP






$

(0.06)


Non-GAAP






$

0.04


Shares used to compute diluted net income (loss) per share:







GAAP






99,868


Non-GAAP






103,190





Three months ended December 31, 2020


Revenue

Gross Profit

Total
Operating Expense

Income from Operations

Total Non-
operating
expense, net

Net Income

GAAP

$

131,528


$

71,562


$

54,787


$

16,775


$

(3,349)


$

13,465


Stock-based compensation


348


(3,955)


4,303



4,303


Amortization of intangibles



(756)


756



756


Restructuring and related charges


863


(750)


1,613



1,613


Loss on convertible debt extinguishment





528


528


Non-cash interest and other expenses related to convertible notes





1,607


1,607


Discrete tax items and tax effect of non-GAAP adjustments






(2,262)


Total adjustments


1,211


(5,461)


6,672


2,135


6,545


Non-GAAP

$

131,528


$

72,773


$

49,326


$

23,447


$

(1,214)


$

20,010


As a % of revenue (GAAP)


54.4

%

41.7

%

12.8

%

(2.5)

%

10.2

%

As a % of revenue (Non-GAAP)


55.3

%

37.5

%

17.8

%

(0.9)

%

15.2

%

Diluted net income per share:







GAAP






$

0.13


Non-GAAP






$

0.20


Shares used to compute diluted net income per share:







GAAP and Non-GAAP






100,316





Three months ended March 27, 2020


Revenue

Gross Profit

Total
Operating Expense

Loss from Operations

Total Non-
operating
expense, net

Net Loss

GAAP

$

78,417


$

36,738


$

54,787


$

(18,049)


$

(3,176)


$

(21,954)


Stock-based compensation


771


(5,488)


6,259



6,259


Amortization of intangibles


885


(770)


1,655



1,655


Restructuring and related charges


(73)


(676)


603



603


Non-cash interest and other expenses related to convertible notes





1,835


1,835


Discrete tax items and tax effect of non-GAAP adjustments






1,816


Total adjustments


1,583


(6,934)


8,517


1,835


12,168


Non-GAAP

$

78,417


$

38,321


$

47,853


$

(9,532)


$

(1,341)


$

(9,786)


As a % of revenue (GAAP)


46.8

%

69.9

%

(23.0)

%

(4.1)

%

(28.0)

%

As a % of revenue (Non-GAAP)


48.9

%

61.0

%

(12.2)

%

(1.7)

%

(12.5)

%

Diluted net loss per share:







GAAP






$

(0.23)


Non-GAAP






$

(0.10)


Shares used to compute diluted net loss per share:







GAAP and Non-GAAP






95,575


 

Harmonic Inc.

Preliminary Adjusted EBITDA Reconciliation (Unaudited)

(In thousands)



Three months ended


April 2, 2021


December 31, 2020


March 27, 2020

Net income (loss) - GAAP

$

(6,124)



$

13,465



$

(21,954)


Provision for (benefit from) income taxes

696



(39)



729


Interest expense, net

2,603



2,737



2,903


Depreciation

3,057



3,054



2,843


Amortization of intangibles

507



756



1,655


EBITDA

739



19,973



(13,824)








Adjustments






Stock-based compensation

8,398



4,303



6,259


Loss on convertible debt extinguishment



528




Restructuring and related charges

7



1,613



603


Adjusted EBITDA

$

9,144



$

26,417



$

(6,962)


 

Harmonic Inc.

GAAP to Non-GAAP Reconciliations on Financial Guidance

(In millions, except percentages and per share data)



Q2 2021 Financial Guidance


Revenue

Gross Profit

Total Operating Expense

Income (Loss) from Operations

Total Non-
operating
Expense, net

Net Income (Loss)

GAAP

$102.0 to $112.0

$49.2 to $56.2

$56.5 to $58.5

$(7.3) to $(2.3)

$(2.8)

$(10.9) to $(5.9)

Stock-based compensation expense

0.2

(4.3)

4.5

4.5

Amortization of intangibles

Restructuring and related charges

0.3

(0.2)

0.5

0.5

Non-cash interest and other expenses related to convertible notes

1.5

1.5

Tax effect of non-GAAP adjustments

$0.6 to $1.1

Total adjustments

0.5

(4.5)

5.0

1.5

$7.1 to $7.6

Non-GAAP

$102.0 to $112.0

$49.7 to $56.7

$52.0 to $54.0

$(2.3) to $2.7

$(1.3)

$(3.3) to $1.3

As a % of revenue (GAAP)


48.2% to 50.2%

55.4% to 52.3%

(7.2%) to (2.0)%

(2.8)% to (2.5)%

(10.7)% to (5.2)%

As a % of revenue (Non-GAAP)


48.7% to 50.6%

51.0% to 48.2%

(2.3)% to 2.4%

(1.3)% to (1.2)%

(3.2)% to 1.1%

Diluted net income (loss) per share:







GAAP






$(0.11) to $(0.06)

Non-GAAP






$(0.03) to $0.01

Shares used to compute diluted net income (loss) per share:







GAAP






101.2

Non-GAAP






101.2 to 104.2









2021 Financial Guidance


Revenue

Gross Profit

Total Operating
Expense

Income (Loss) from Operations

Total Non-
operating
Expense, net

Net Income (Loss)

GAAP

$435.0 to $480.0

$217.5 to $247.1

$231.5 to $240.5

$(14.0) to $6.6

$(10.2)

$(27.0) to $(6.4)

Stock-based compensation expense

2.0

(21.3)

23.3

23.3

Amortization of intangibles

(0.5)

0.5

0.5

Restructuring and related charges

0.5

(0.7)

1.2

1.2

Non-cash interest and other expenses related to convertible notes

6.3

6.3

Tax effect of non-GAAP adjustments

$0.0 to $2.1

Total adjustments

2.5

(22.5)

25.0

6.3

$31.3 to $33.4

Non-GAAP

$435.0 to $480.0

$220.0 to $249.6

$209.0 to $218.0

$11.0 to $31.6

$(3.9)

$6.4 to $24.9

As a % of revenue (GAAP)


50.0% to 51.5%

53.2% to 50.1%

(3.2)% to 1.4%

(2.3)% to (2.1)%

(6.2)% to (1.3%)

As a % of revenue (Non-GAAP)


50.6% to 52.0%

48.0% to 45.4%

2.5% to 6.6%

(0.9)% to (0.8)%

1.5% to 5.2%

Diluted net income (loss) per share:







GAAP






$(0.27) to $(0.06)

Non-GAAP






$0.06 to $0.24

Shares used to compute diluted net income (loss) per share:







GAAP






101.4

Non-GAAP






104.7

 

Harmonic Inc.

Adjusted EBITDA Reconciliation on Financial Guidance (Unaudited)

(In millions)



Q2 2021 Financial
Guidance


2021 Financial
Guidance

Net loss - GAAP

$(10.9) to $(5.9)


$(27.0) to $(6.4)

Provision for income taxes

0.7



2.9


Interest expense, net

2.5



10.2


Depreciation

3.5



14.0


Amortization of intangibles



0.5


EBITDA

$(4.2) to $0.8


$0.6 to $21.2





Adjustments




Stock-based compensation

4.5



23.3


Restructuring and related charges

0.5



1.2


Adjusted EBITDA

$0.8 to $5.8


$25.1 to $45.7

 

Cision View original content to download multimedia:http://www.prnewswire.com/news-releases/harmonic-announces-first-quarter-2021-results-301282026.html

SOURCE Harmonic Inc.

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