LSI Reports Fourth Quarter and Full-Year 2010 Results
MILPITAS, Calif., January 26, 2011 - LSI Corporation (NYSE: LSI) today reported results for its fourth quarter and full year ended December 31, 2010.
Fourth Quarter and Full-Year 2010 News Release Summary
Fourth quarter 2010 revenues of $664 million
Fourth quarter 2010 GAAP* net loss of 2 cents per share
Fourth quarter 2010 non-GAAP** net income of 14 cents per diluted share
Fourth quarter operating cash flows of $112 million
Full-year 2010 revenues of $2.6 billion
First Quarter 2011 Business Outlook
Projected revenues of $605 million to $635 million
GAAP* net (loss)/income in the range of ($0.03) to $0.07 per share
Non-GAAP** net income in the range of $0.07 to $0.13 per share
* Generally Accepted Accounting Principles.
** Excludes goodwill and other intangible asset impairment, stock-based compensation, amortization of acquisition-related intangibles, purchase accounting effect on inventory, restructuring of operations and other items, net, and gain/loss on sale/write-down of investments. It also excludes the income tax effect associated with the above mentioned items.
Fourth quarter 2010 revenues were $664 million, a 4% increase year over year compared to $638 million reported in the fourth quarter of 2009, and compared to $629 million reported in the third quarter of 2010.
Fourth quarter 2010 GAAP* net loss was $13 million or 2 cents per share, compared to fourth quarter 2009 GAAP net income of $65 million or 10 cents per diluted share. Fourth quarter 2010 GAAP results compare to third quarter 2010 GAAP net income of $23 million or 4 cents per diluted share. Fourth quarter 2010 GAAP net income included a net charge of $103 million from special items, consisting primarily of $48 million of net restructuring and other items, $40 million of amortization of acquisition-related items, and $15 million of stock-based compensation expense.
Fourth quarter 2010 non-GAAP** net income was $90 million or 14 cents per diluted share, compared to fourth quarter 2009 non-GAAP net income of $124 million or 18 cents per diluted share. Third quarter 2010 non-GAAP net income was $79 million or 13 cents per diluted share.
Cash and short-term investments totaled approximately $677 million at quarter end. The company completed fourth-quarter purchases of approximately 6 million shares of its common stock for approximately $32 million. In 2010, the company purchased approximately 51 million shares of its common stock for approximately $250 million, completing its repurchase program announced in March, 2010.
"We delivered solid quarterly revenue growth with revenues near the high end of our guidance range, reflecting seasonal strength in our storage systems and storage semiconductor businesses," said Abhi Talwalkar, LSI president and chief executive officer. "For the full year, our revenues grew substantially, driven by increased enterprise spending for IT infrastructure products that rely on our technology. As economic conditions continue to improve in 2011, we expect to benefit from higher enterprise spending levels and new product ramps with our tier one customers."
LSI recorded full-year 2010 revenues of $2.57 billion, a 16% increase compared to $2.22 billion in 2009. The company reported 2010 GAAP net income of $40 million or 6 cents per diluted share. Full-year 2010 GAAP results compare to full-year 2009 GAAP net loss of $48 million or 7 cents per share. Full-year 2010 GAAP net income included a net charge of $293 million from special items, consisting primarily of $161 million in the amortization of acquisition-related items, $66 million of stock-based compensation expense, $59 million of restructuring costs, and $7 million of net loss on the sale and write-down of investments.
Non-GAAP net income for 2010 was $333 million or 52 cents per diluted share, compared to 2009 non-GAAP net income of $232 million or 35 cents per diluted share.
Bryon Look, LSI CFO and chief administrative officer, said, "We delivered another quarter of solid operating performance, with operating cash flows growing 36% sequentially to $112 million. For the full year, our operating cash flows were $367 million, up 80% year over year. Our balance sheet further strengthened as we ended the year with $677 million of net cash while remaining debt free. On a full-year basis, our profitability also improved significantly as we continued to focus on making progress toward our business model targets."
Capital spending is projected to be around $15 million in the first quarter and approximately $60 million in total for 2011.
Depreciation and software amortization is projected to be around $26 million in the first quarter and approximately $105 million in total for 2011.
LSI Conference Call Information
LSI will hold a conference call today at 2 p.m. PST to discuss fourth quarter financial results and the first quarter 2011 business outlook. Internet users can access the conference call at http://www.lsi.com/webcast. Subsequent to the conference call, a replay will be available at the same web address.
LSI Corporation (NYSE: LSI) is a leading provider of innovative silicon, systems and software technologies that enable products which seamlessly bring people, information and digital content together. The company offers a broad portfolio of capabilities and services including custom and standard product ICs, adapters, systems and software that are trusted by the world's best known brands to power leading solutions in the Storage and Networking markets. More information is available at http://www.lsi.com