Harmonic Inc. · NASDAQ:HLIT
Harmonic — Q3 2012 Earnings Presentation
18 slides from Harmonic's earnings presentation, Oct 23, 2012
Slide 1: Third Quarter 2012 Earnings Conference Call
Third Quarter 2012 Earnings Conference Call October 23, 2012 Patrick Harshman, President & CEO Carolyn Aver, Chief Financial Officer www.harmonicinc.com ©2011 Harmonic, Inc. All rights reserved worldwide.
Slide 2: Forward Looking Statements
Forward Looking Statements During the course of this presentation, we will provide projections and other forward looking statements regarding future events or the future financial performance of Harmonic, including expectations concerning our 2012 business strategy and our Q4 2012 financial outlook.
Slide 3: Q3 2012: Results
Q3 2012: Results Revenue $136.7M – In line with expectations – Strong cable demand – Record service and support revenue Bookings $128.7M – Continuing macroeconomic headwinds (Europe) – Positive demand trends from Asia – Book-to-bill for the year above 1:1 Operating performance – Gross margin 48% (no
Slide 4: Q3 Highlights: International
Q3 Highlights: International European market headwinds Growing demand in Asia and emerging markets Growing penetration of digital TV and HD – New content and channels Continuing multiscreen / OTT wins Service and support growth Gaining market share across geographies – Several competitors in strateg
Slide 5: Q3 Highlights: United States
Q3 Highlights: United States Strong demand from cable operators Slower demand from satellite operators Expanding edgeQAM success Continued multiscreen / OTT wins – Market focus on video bandwidth efficiency Gaining market share across geographies – Several competitors in strategic transition www.har
Slide 6: Industry Leadership: 2012 London Olympics
Industry Leadership: 2012 London Olympics Broadcast Customers: NBC Multiscreen Delivery: NBC, BBC, Virgin Media, 3,500 hours live streaming to Televisa, ESPN Brazil, NHK, TV, PC, tablets & smartphones CCTV, Foxtel, SRG-SSR, Sky Peak usage: 35-40% U.S. Italia, NRK, France Television bandwidth Product
Slide 7: Industry Recognition
Industry Recognition IBC 2012 Awards – Best Mobile TV Technology, CSI – ProMedia Suite – STAR Award, TV Technology Europe – ProMedia Express SCTE 2012 Awards – Diamond Technology Award 2012 – ProStream, ProView, Iris Emmy for Technology and Engineering – For excellence in engineering creativity in "
Slide 8: Emerging Growth Drivers: Cable Edge
Emerging Growth Drivers: Cable Edge CCAP – Convergence of QAM and CMTS markets – Increases bandwidth flexibility and efficiency – Simplifies and reduces costs at cable headends NSG Pro Announcement – Further solidifies edgeQAM leadership – Already in customer lab trials – Opens up new $1.5 – $2.0 B
Slide 9: Emerging Growth Drivers: Video Processing
Emerging Growth Drivers: Video Processing “Ultra HD” 4K – 4 times the pixels of 1080 HDTV – Industry is launching TV sets, cameras now – Growing customer interest across market verticals High Efficiency Video Coding – HEVC – Halves bandwidth/doubles frame rate across video infrastructures – Applicab
Slide 10: Q3 2012: Financial Highlights
Q3 2012: Financial Highlights $Millions Q3 Q2 Q3 Q3/Q2 Q3 Y/Y (except GM, OM and EPS) 2012 2012 2011 Change Change Total Net Revenue $136.7 $132.6 $138.9 3% -2% Gross Margin % - Non-GAAP 48% 48% 51% 20BP -260BP Gross Margin % - GAAP 44% 43% 46% 40BP -230BP Operating Expense - Non-GAAP $54.8 $53.9 $5
Slide 11: Quarterly Revenue and Backlog
Quarterly Revenue and Backlog $Millions Revenue Backlog/Deferred Revenue 150 125 100 75 50 25 0 Q1 2011 Q2 2011 Q3 2011 Q4 2011 Q1 2012 Q2 2012 Q3 2012 www.harmonicinc.com ©Harmonic ©2011 Inc.Inc. Harmonic, All All rights reserved rights reservedworldwide. worldwide. 11
Slide 12: Q3 2012: Revenue Mix
Q3 2012: Revenue Mix GEOGRAPHY PRODUCTS MARKETS Video Processing Edge and Access International United States Cable Broadcast and Media Satellite and Telco Production and Playout Services and Support 17% 20% 42% 37% 50% 17% 58% 30% 29% www.harmonicinc.com ©2011 Harmonic, Inc. All rights reserved worl
Slide 13: Q3 2012: Balance Sheet and Cap-Ex Highlights
Q3 2012: Balance Sheet and Cap-Ex Highlights $Millions Cash $192.0 Up $14.2M from Q2 Accounts Receivable $94.6 63 days Inventories $68.3 4.2 turns Debt $0 Capital Expenditures $3.3 $14M-$16M for 2012 Shares Repurchased $7.4 1.65 M Shares www.harmonicinc.com ©Harmonic ©2011 Inc.Inc. Harmonic, All All
Slide 14: Q4 2012: Financial Guidance
Q4 2012: Financial Guidance Metric Q4 Revenue $132M - $142M Non-GAAP Gross Margin* 48% - 50% Non-GAAP Operating Expenses* $55M - $56.5M Non-GAAP Tax Rate** 25% - 26% *Excludes charges for stock-based compensation and the amortization of intangibles. **Assumes no extension to the R&D tax credit www.h
Slide 15: Third Quarter 2012 Earnings Conference Call
Third Quarter 2012 Earnings Conference Call October 23, 2012 Patrick Harshman, President & CEO Carolyn Aver, Chief Financial Officer www.harmonicinc.com ©2011 Harmonic, Inc. All rights reserved worldwide.
Slide 16: Use of Non-GAAP Financial Measures
Use of Non-GAAP Financial Measures In establishing operating budgets, managing its business performance, and setting internal measurement targets, the Company excludes a number of items required by GAAP. Management believes that these accounting charges and credits, most of which are non-cash or non
Slide 17: Q3 2012: GAAP to Non-GAAP Reconciliation
Q3 2012: GAAP to Non-GAAP Reconciliation T hr ee mo nt hs end ed Sep t emb er 2 8 , 2 0 12 Sep t emb er 3 0 , 2 0 11 N et Gr o ss Op er at ing Gr o ss Op er at ing N et Inco me Pr o f it Exp ense Pr o f it Exp ense Inco me ( Lo ss) ( In t ho usand s, excep t p er shar e amo unt s) GA A P $ 59,904 $
Slide 18: Third Quarter 2012 Earnings Conference Call
Third Quarter 2012 Earnings Conference Call October 23, 2012 Patrick Harshman, President & CEO Carolyn Aver, Chief Financial Officer www.harmonicinc.com ©2011 Harmonic, Inc. All rights reserved worldwide.