OmniVision Reports Financial Results for Second Quarter of Fiscal 2009

SANTA CLARA, Calif. , Dec. 2 /PRNewswire-FirstCall/ -- OmniVision Technologies, Inc. (Nasdaq: OVTI), a leading supplier of CMOS image sensors, today reported financial results for the second fiscal quarter ended October 31, 2008...


SANTA CLARA, Calif. , Dec. 2 /PRNewswire-FirstCall/ -- OmniVision Technologies, Inc. (Nasdaq: OVTI), a leading supplier of CMOS image sensors, today reported financial results for the second fiscal quarter ended October 31, 2008 .

Revenues for the second quarter of fiscal 2009 were $163.9 million, as compared to $174.3 million in the first quarter of fiscal 2009, and $232.6 million in the second quarter of fiscal 2008.

During the second quarter of fiscal 2009, the Company performed a goodwill impairment analysis in accordance with FAS 142. The Company would normally test its goodwill for impairment at year-end. However, the significant decline in the Company's market capitalization and the current economic downturn prompted management to perform an interim impairment analysis. Based on the work performed to date, the Company concluded that an impairment loss is probable and estimable. As a result, the Company recorded an impairment charge of $7.5 million of its goodwill. The Company did not record any impairment of its intangible assets or its other long-lived assets.

GAAP net loss in the second quarter of fiscal 2009, which includes stock-based compensation expense and the related tax effects under FAS 123(R) and the goodwill impairment charge, was $5.3 million, or $0.10 per share, as compared to net income of $6.2 million, or $0.12 per diluted share, in the first quarter of fiscal 2009, and $20.5 million, or $0.36 per diluted share in the second quarter of fiscal 2008.

Non-GAAP net income in the second quarter of fiscal 2009, which excludes stock-based compensation expense and the related tax effects under FAS 123(R) and the goodwill impairment charge, was $10.1 million and non-GAAP earnings were $0.19 per diluted share. Non-GAAP net income in the first quarter of fiscal 2009, which excludes stock-based compensation expense and the related tax effects under FAS 123(R), was $12.8 million and non-GAAP earnings were $0.25 per diluted share. Non-GAAP net income in the second quarter of fiscal 2008, which excludes stock-based compensation expense and the related tax effects, was $29.2 million and non-GAAP earnings were $0.51 per diluted share. Refer to the attached schedule for a reconciliation of GAAP net income (loss) to non-GAAP net income for the three and six months ended October 31, 2008 and 2007.

Gross margin for the second quarter of fiscal 2009 was 25.0% as compared to 25.2% for the first quarter of fiscal 2009 and 25.2% for the second quarter of fiscal 2008. The decrease in gross margin resulted primarily from the recognition of additional allowances for inventories, partially offset by a more favorable product mix and higher average selling prices than in the first quarter of fiscal 2009.

The Company ended the period with cash, cash equivalents and short-term investments totaling $282.7 million, an increase of $3.3 million from the previous quarter. The increase reflects favorable cash flow from operations during the quarter, partially offset by approximately $12.9 million in cash used for the repurchase of the Company's common stock.

"During the second quarter, we continued to see higher penetration of cameras into notebook computers and the transition to higher resolution cameras in phones with two megapixel and above sensors representing the highest percentage of revenue in our history," said Shaw Hong, OmniVision's president and chief executive officer.

"Separately, we are closely monitoring industry and economic conditions during these difficult financial times, and are focused on being able to deliver market leading technologies and products in the most cost-effective manner possible," Mr. Hong concluded.

Outlook

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