UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

__________________

FORM 8-K

__________________

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): July 29, 2015

__________________

CAVIUM, INC.

(Exact name of registrant as specified in its charter)

__________________

Delaware

(State or other jurisdiction

of incorporation)

 

001-33435

 

77-0558625

(Commission

File No.)

 

(IRS Employer

Identification No.)

2315 N. First Street, San Jose CA 95131

(Address of principal executive offices) (Zip Code)

Registrant’s telephone number, including area code: (408) 943-7100

 

N/A

(Former name or former address, if changed since last report.)

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))


Item 2.02. Results of Operations and Financial Condition

On July 29, 2015, Cavium, Inc. (the "Company") issued a press release announcing its financial results for the second quarter of 2015. A copy of the press release is furnished as Exhibit 99.1 to this report and is incorporated herein by reference.

The information under Item 2.02 of this report, including Exhibit 99.1 hereto, shall not be deemed to be "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section or Sections 11 and 12(a)(2) of the Securities Act of 1933, as amended. The information and the accompanying exhibit shall not be incorporated by reference into filings with the U.S. Securities and Exchange Commission (the "SEC") made by the Company, whether made before or after the date hereof, regardless of any general incorporation language in such filing.

Item 9.01. Financial Statements and Exhibits

(a) Financial statements:
            None
(b) Pro forma financial information:
            None
(c) Shell company transactions:
            None
(d) Exhibits
            99.1       Press Release of Cavium, Inc. dated July 29, 2015

 


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.

 

Dated: July 29, 2015

 

CAVIUM, INC.

 

 

 

 

 

 

 

 

By:

/s/ ARTHUR D. CHADWICK

 

 

 

 

Arthur D. Chadwick

 

 

 

 

Vice President of Finance and Administration and Chief  Financial Officer

 

 


Exhibit Index

 

Exhibit No.

 

Description

99.1

 

Press Release of Cavium, Inc. dated July 29, 2015

 



Exhibit 99.1

 

 

Cavium

Announces Financial Results for Q2 2015

SAN JOSE, Calif., July 29, 2015 – Cavium, Inc. (NASDAQ: CAVM), a leading provider of semiconductor products that enable secure and intelligent processing for enterprise, data center, wired and wireless networking, today announced financial results for the second quarter ended June 30, 2015.

Net revenue in the second quarter of 2015 was $105.0 million, a 3.1% sequential increase from the $101.8 million reported in the first quarter of 2015 and a 15.8% year-over-year increase from the $90.7 million reported in the second quarter of 2014.

Generally Accepted Accounting Principles (GAAP) Results

Net loss in the second quarter of 2015 was $6.4 million, or $(0.11) per diluted share, compared to $13.9 million, or $(0.25) per diluted share in the first quarter of 2015. Gross margins were 64.1% in the second quarter of 2015 compared to 64.8% in the first quarter of 2015. Total cash and cash equivalents were $122.0 million at June 30, 2015.

Non-GAAP Results

Cavium believes that the presentation of non-GAAP financial measures provides important supplemental information to management and investors regarding financial and business trends relating to Cavium’s financial condition and results of operations. These measures should only be used to evaluate Cavium’s results of operations in conjunction with the corresponding GAAP measures. The reconciliation between GAAP and non-GAAP financial results is provided in the financial statements portion of this release.

In the second quarter of 2015, Non-GAAP net income was $24.2 million, or $0.41 per diluted share. Non-GAAP gross margin was 66.8% and Non-GAAP operating margin (non-GAAP income from operations as a percentage of revenue) was 23.0%.



Recent News Highlights

·

July 22, 2015 - Cavium Unveiled the 100 Gbps NITROX® V Security Processor Family

·

July 13, 2015 - Cavium and Leading Partners Showcased Advanced ThunderX™ ARM-based Server Platforms and Software for High Performance Computing at ISC 2015

·

July 13, 2015 - Cavium Announced Beta Support for PathScale EKOPath Compiler and Optimized Math Libraries on ThunderX™ Processor Family

·

July 13, 2015 - Cavium Unveiled Flash Support for the Cavium ThunderX™ Processor Family

·

July 13, 2015 - Cavium Added Support for Mellanox InfiniBand Adapters for ThunderX™ Processor Family

·

July 13, 2015 - Mont-Blanc HPC software stack tested on E4's HPC platform based on ARM64 Cavium ThunderX processor

·

June 16, 2015 - Cavium Crowned Winner of SDN Idol 2015 at Open Networking Summit 2015

·

June 16, 2015 - Cavium Unleashed the Power of SDN through OpenFlow at ONS 2015

·

June 10, 2015 Cavium Announced New Low Power 16-core OCTEON® III SoC Processors for Next Generation Enterprise, Data Center and Service Provider Infrastructure

·

June 10, 2015 - 64-bit MIPS architecture provides low-power, high-throughput processing for Cavium's new OCTEON® III processors

·

June 10, 2015 - Green Hills Software Announced INTEGRITY® RTOS Multicore Support for OCTEON® III Family of SoC from Cavium

·

June 6, 2015 - Qulsar's Processors Managed Timing Engine Enhances Timing Synchronization in Cavium Small Cell Basestation Designs

·

June 1, 2015 - Cavium and Leading Partners Showcased Best-in-Class Product Solutions across Cloud, Data Center and Enterprise at Computex 2015

·

June 1, 2015 - Cavium Announced Collaboration with Pegatron on Server Platforms based on Cavium's ThunderX™ Workload Optimized Processor Family

·

June 1, 2015 - Leading Network Solution Providers and ODMs Partner with Cavium to Bring to Market Multiple Hardware Ethernet Switch Platforms

·

June 1, 2015 - Cavium OCTEON® III Expands Footprint to Industrial, Military and Aerospace Applications by Offering Standard Computer-On-Module Form Factors

·

May 18, 2015 - Cavium Partners with Canonical to Demonstrate Optimized Cloud Infrastructure with OpenStack at Scale on ThunderX™

·

May 14, 2015 - QLogic and Cavium Collaborates to Deliver Accelerated Performance for Enterprise and Cloud Storage Applications

 

Cavium, Inc. will broadcast its second quarter of 2015 financial results conference call today, July 29, 2015, at 2 p.m. Pacific time (5 p.m. Eastern time).  The conference call will be available via a live web cast on the investor relations section of the Cavium website at http://www.cavium.com.  Please access the website at least a few minutes prior to the start of the call in order to download and install any necessary audio software. An archived web cast replay of the call will be available on the web site for a limited period of time.

About Cavium

Cavium is a leading provider of highly integrated semiconductor products that enable intelligent processing in enterprise, data center, cloud and wired and wireless service provider applications. Cavium offers a broad portfolio of integrated, software-compatible processors ranging in performance from 100 Mbps to 100 Gbps that enable secure, intelligent functionality in enterprise, data-center, broadband/consumer and access and service provider equipment. Cavium’s processors are supported by ecosystem partners that provide operating systems, tool support, reference designs and other services. Cavium’s principal office is in San Jose, CA with design team locations in California, Massachusetts, India and China. For more information, please visit: http://www.cavium.com.



 

CAVIUM, INC.

Unaudited GAAP Condensed Consolidated Statements of Operations

(in thousands, except per share amounts)

 

 

Three Months Ended

 

 

June 30, 2015

 

 

March 31, 2015

 

Net revenue

$

104,961

 

 

$

101,778

 

Cost of revenue

 

37,673

 

 

 

35,799

 

Gross profit

 

67,288

 

 

 

65,979

 

Operating expenses:

 

 

 

 

 

 

 

     Research and development

 

52,225

 

 

 

58,422

 

     Sales, general and administrative

 

20,336

 

 

 

20,671

 

        Total operating expenses

 

72,561

 

 

 

79,093

 

Loss from operations

 

(5,273

)

 

 

(13,114

)

Other expense, net:

 

 

 

 

 

 

 

    Interest expense

 

(388

)

 

 

(410

)

    Other, net

 

(33

)

 

 

(66

)

Total other expense, net

 

(421

)

 

 

(476

)

     Loss before income taxes

 

(5,694

)

 

 

(13,590

)

     Provision for income taxes

 

661

 

 

 

301

 

Net loss

 

(6,355

)

 

 

(13,891

)

Net loss per common share, basic and diluted

$

(0.11

)

 

$

(0.25

)

Shares used in computing basic and diluted net loss per common share

 

55,507

 

 

 

54,882

 



CAVIUM, INC.

Unaudited Reconciliation of Non-GAAP Adjustments

(in thousands)

 

 

Three Months Ended

 

 

June 30, 2015

 

 

March 31, 2015

 

Reconciliation of GAAP operating expenses to non-GAAP:

 

 

 

 

 

 

 

GAAP research and development expenses

$

52,225

 

 

$

58,422

 

Stock-based compensation and related payroll taxes

 

(7,896

)

 

 

(7,823

)

Amortization of acquisition related assets

 

(2,932

)

 

 

-

 

Net restructuring related expenses

 

-

 

 

 

(254

)

Research and development expenses associated with Xpliant

 

(8,845

)

 

 

(20,142

)

Non-GAAP research and development expenses

$

32,552

 

 

$

30,203

 

 

 

 

 

 

 

 

 

GAAP sales, general and administrative expenses

$

20,336

 

 

$

20,671

 

Stock-based compensation and related payroll taxes

 

(4,429

)

 

 

(5,138

)

Amortization of acquisition related assets

 

(11

)

 

 

(11

)

Net restructuring related expenses

 

-

 

 

 

(68

)

Sales, general and administrative expenses associated with Xpliant

 

(2,554

)

 

 

(1,979

)

Non-GAAP sales, general and administrative expenses

$

13,342

 

 

$

13,475

 

Total Non-GAAP operating expenses

$

45,894

 

 

$

43,678

 

 

 

 

 

 

 

 

 

Reconciliation of GAAP non-operating expenses to non-GAAP non-operating income:

 

 

 

 

 

 

 

GAAP non-operating expenses

$

(421

)

 

$

(476

)

Non-operating expenses associated with Xpliant

 

1,144

 

 

 

1,124

 

Total Non-GAAP non-operating income

$

723

 

 

$

648

 

 

 



CAVIUM, INC.

Unaudited Reconciliation of Non-GAAP Adjustments

(in thousands, except per share data and percentages)

 

Three Months Ended

 

 

June 30, 2015

 

 

March 31, 2015

 

Reconciliation of GAAP gross profit & margin to non-GAAP:

 

 

 

 

 

 

 

Net revenue

$

104,961

 

 

$

101,778

 

GAAP gross profit

 

67,288

 

 

 

65,979

 

GAAP gross margin

 

64.1

%

 

 

64.8

%

 

 

 

 

 

 

 

 

Stock-based compensation and related payroll taxes

 

212

 

 

 

213

 

Amortization of acquisition related assets

 

157

 

 

 

795

 

Discontinued mask

 

2,420

 

 

 

-

 

Net restructuring related expenses

 

-

 

 

 

42

 

Non-GAAP gross profit

$

70,077

 

 

$

67,029

 

Non-GAAP gross margin

 

66.8

%

 

 

65.9

%

 

 

 

 

 

 

 

 

Reconciliation of GAAP loss from operations to non-GAAP income from operations:

 

 

 

 

 

 

 

GAAP loss from operations

$

(5,273

)

 

$

(13,114

)

Stock-based compensation and related payroll taxes

 

12,537

 

 

 

13,174

 

Amortization of acquisition related assets

 

3,100

 

 

 

806

 

Discontinued mask

 

2,420

 

 

 

-

 

Net restructuring related expenses

 

-

 

 

 

364

 

Loss from operations of Xpliant

 

11,399

 

 

 

22,121

 

Non-GAAP income from operations

$

24,183

 

 

$

23,351

 

Non-GAAP income from operations as a percentage of revenue

 

23.0

%

 

 

22.9

%

 

 

 

 

 

 

 

 

Reconciliation of GAAP loss to non-GAAP net income:

 

 

 

 

 

 

 

GAAP net loss

$

(6,355

)

 

$

(13,891

)

Non-GAAP adjustments:

 

 

 

 

 

 

 

Stock-based compensation and related payroll taxes

 

12,537

 

 

 

13,174

 

Amortization of acquisition related assets

 

3,100

 

 

 

806

 

Discontinued mask

 

2,420

 

 

 

-

 

Net restructuring related expenses and other charges

 

-

 

 

 

364

 

Loss from operations and non-operating expenses of Xpliant

 

12,543

 

 

 

23,245

 

Total of non-GAAP adjustments

 

30,600

 

 

 

37,589

 

Non-GAAP net income

$

24,245

 

 

$

23,698

 

 

 

 

 

 

 

 

 

GAAP net loss per share, diluted

$

(0.11

)

 

$

(0.25

)

Non-GAAP adjustments detailed above

 

0.52

 

 

 

0.65

 

Non-GAAP net income per share, diluted

$

0.41

 

 

$

0.40

 

 

 

 

 

 

 

 

 

GAAP weighted average shares, diluted

 

55,507

 

 

 

54,882

 

Non-GAAP share adjustment

 

4,114

 

 

 

4,286

 

Non-GAAP weighted average shares, diluted

 

59,621

 

 

 

59,168

 

 



CAVIUM, INC.

Unaudited GAAP Condensed Consolidated Balance Sheets

(in thousands)

 

 

As of

June 30, 2015

 

 

As of

March 31, 2015

 

Assets

 

 

 

 

 

 

 

Current assets

 

 

 

 

 

 

 

Cash and cash equivalents

$

121,984

 

 

$

121,025

 

Accounts receivable, net

 

67,165

 

 

 

56,817

 

Inventories

 

50,403

 

 

 

52,312

 

Prepaid expenses and other current assets

 

9,312

 

 

 

8,944

 

Total current assets

 

248,864

 

 

 

239,098

 

Property and equipment, net

 

60,235

 

 

 

58,828

 

Intangible assets, net

 

37,023

 

 

 

37,532

 

Goodwill

 

71,478

 

 

 

71,478

 

Other assets

 

1,952

 

 

 

1,935

 

Total assets

$

419,552

 

 

$

408,871

 

 

 

 

 

 

 

 

 

Liabilities and Stockholders' Equity

 

 

 

 

 

 

 

Current liabilities

 

 

 

 

 

 

 

Accounts payable

$

32,702

 

 

$

25,100

 

Other accrued expenses and other current liabilities

 

14,950

 

 

 

15,945

 

Deferred revenue

 

7,273

 

 

 

6,047

 

Capital lease and technology license obligations

 

18,383

 

 

 

16,324

 

Total current liabilities

 

73,308

 

 

 

63,416

 

Capital lease and technology license obligations, net of current

 

15,981

 

 

 

20,788

 

Deferred tax liability

 

3,159

 

 

 

2,997

 

Other non-current liabilities

 

2,970

 

 

 

2,819

 

Total liabilities

 

95,418

 

 

 

90,020

 

 

 

 

 

 

 

 

 

Stockholders' equity

 

 

 

 

 

 

 

Common stock

 

56

 

 

 

55

 

Additional paid-in capital

 

516,676

 

 

 

505,039

 

Accumulated deficit

 

(192,598

)

 

 

(186,243

)

Total stockholders' equity

 

324,134

 

 

 

318,851

 

Total liabilities and stockholders' equity

$

419,552

 

 

$

408,871

 

 

 

Cavium Contact:

Art Chadwick

 

Angel Atondo

Vice President of Finance and Administration and Chief Financial Officer              

 

Senior Marketing Communications Manager

Tel: (408) 943-7104

 

Tel: (408) 943-7417    

Email: art.chadwick@cavium.com

 

Email: angel.atondo@cavium.com

 

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