Ruckus Wireless Reports Fourth Quarter and 2012 Financial Results
SUNNYVALE, CA — February 12, 2013 — Ruckus Wireless, Inc. (NYSE: RKUS) today announced financial results for its fourth quarter and year-ended December 31, 2012.
Financial Summary
Revenue for the fourth quarter was $62.2 million, an increase of 51% when compared to $41.0 million reported in the fourth quarter of 2011. GAAP net income for the fourth quarter was $1.9 million, compared with a net income of $3.2 million in the fourth quarter of 2011. Non-GAAP net income for the fourth quarter was $6.1 million, compared with non-GAAP net income of $4.9 million in the fourth quarter of 2011.
GAAP net income per diluted share was $0.03 for the fourth quarter of 2012 compared to $0.02 for the fourth quarter of 2011 based on net income attributable to common stockholders. Non-GAAP net income per diluted share was $0.07 for the fourth quarter of 2012 compared to $0.07 for the fourth quarter of 2011.
2012 revenue was $214.7 million, an increase of 79% when compared to $120.0 million reported in 2011. GAAP net income for 2012 was $31.7 million, compared with net income of $4.2 million in 2011. Non-GAAP net income for 2012 was $42.9 million, compared with $7.4 million in 2011.
GAAP net income per diluted share was $0.24 for 2012 compared to $0.02 for 2011 based on net income attributable to common stockholders. Non-GAAP net income per diluted share was $0.54 for 2012 compared to $0.11 for 2011. 2012 included a tax benefit of $17.2 million primarily related to the release of the valuation allowance on our net deferred tax assets.
A description of the non-GAAP calculations and reconciliation to comparable GAAP measures is provided in the accompanying table entitled “Reconciliation of GAAP to Non-GAAP Financial Measures.”
“2012 was an exciting year for Ruckus Wireless. In addition to completing our IPO, we continued to make progress on our business objectives while growing our revenue 79% and significantly increasing profitability over the prior year,” said Selina Lo, president and Chief Executive Officer at Ruckus Wireless. “Our differentiated, carrier-class Wi-Fi technology has positioned us as a leader in the nascent service provider Wi-Fi market; we also had the highest revenue growth rate, year-over-year and sequentially, among the top five revenue producers in enterprise Wi-Fi, according to the most recent Gartner Enterprise WLAN Equipment Market Shares report. A major beneficiary of the mobile Internet movement, Wi-Fi is a secular growth opportunity and Ruckus is well-positioned to capitalize on it in 2013 and beyond.”
Guidance
For the first quarter of 2013 ending March 31, 2013, the Company expects:
- Total revenues in the range of $62 million to $64 million;
- Non-GAAP net income per share will be between $0.03 and $0.04 using 95 million shares on a diluted basis.
Conference Call Information
Ruckus Wireless will host a conference call for analysts and investors to discuss its fourth quarter and 2012 results and outlook for its first quarter of 2013 at 2:00 p.m. Pacific time on February 12, 2013. A live audio webcast of the conference call along with supplemental financial information will also be accessible from the "Investors" section of the company's website at https://investors.ruckuswireless.com. A replay will be available following the call for one week at the following numbers: (888) 286-8010 (domestic) or (617) 801-6888 (international) with ID# 73170206. An archived version of the audio from the call will be available for at least thirty days on the company’s website at https://investors.ruckuswireless.com.
Safe Harbor Statement
This press release contains forward-looking statements, including statements regarding Ruckus Wireless’ expectations for the first quarter of 2013 and statements regarding momentum in the company's business. These statements are subject to risks and uncertainties that could cause actual results and events to differ materially from those anticipated, including, but not limited to, risks and uncertainties related to: growth of the market for Ruckus Wireless products, the lengthy sales cycle for some products, risks associated with Ruckus Wireless’s rapid growth, competition, reliance on third parties, international operations, intellectual property, Ruckus Wireless’s limited operating history, particularly as a new public company; and general market, political, economic and business conditions.
Additional risks and uncertainties that could affect Ruckus Wireless financial results are included under the captions “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” in the company's final prospectus for its initial public offering, which was filed with the U.S. Securities and Exchange Commission on November 16, 2012, and is available on the company’s investor relations website at www.investors.ruckuswireless.com and on the SEC's website at www.sec.gov. Additional information will also be set forth in Ruckus Wireless’s annual report on Form 10-K and other filings that the company makes with the SEC from time to time. All forward-looking statements in this press release are based on information available to the company as of the date hereof, and Ruckus Wireless does not assume any obligation to update the forward-looking statements provided to reflect events that occur or circumstances that exist after the date on which they were made, except as required by law.
Non-GAAP Financial Measures
To supplement our financial results presented in accordance with Generally Accepted Accounting Principles (GAAP), this press release and the accompanying tables and the related earnings conference call contain certain non-GAAP financial measures, including non-GAAP gross profit and gross margin, non-GAAP operating income and operating margin, non-GAAP net income, non-GAAP dilutive net income per share and non-GAAP diluted weighted average shares outstanding. We also provide first quarter 2013 non-GAAP dilutive net income per share and non-GAAP diluted weighted average shares outstanding. We believe these non-GAAP financial measures are helpful in understanding our past financial performance and future results. Our non-GAAP financial measures should not be considered in isolation or as a substitute for comparable GAAP measures and should be read in conjunction with our consolidated financial statements prepared in accordance with GAAP. Our management regularly uses our supplemental non-GAAP financial measures internally to understand and manage our business and forecast future periods. These non-GAAP financial measures are not based on any standardized methodology prescribed by GAAP and are not necessarily comparable to similar measures presented by other companies.
Our non-GAAP financial measures include adjustments based on the following items:
Stock-based compensation expenses: We have excluded the effect of stock-based compensation from our non-GAAP operating results. Although stock-based compensation is a key incentive offered to our employees, we continue to evaluate our business performance excluding stock-based compensation expenses. Stock-based compensation expenses will recur in future periods.
Amortization of intangible assets: We have excluded the effect of amortization of intangible assets from our non-GAAP operating results. Amortization of intangible assets is a non-cash expense, and it is not part of our core operations. Investors should note that the use of intangible assets contributed to revenues earned during the periods presented and will contribute to future period revenues as well.
Change in fair value of preferred stock warrants: We have excluded the effect of the expense resulting from the change in fair value of preferred stock warrants from our non-GAAP operating results. The change in fair value is a non-cash expense, and it is not part of our core operations. Upon completion of our IPO in November 2012, all preferred stock warrants converted to common stock warrants.
Our non-GAAP Financial Measures are described as follows:
Non-GAAP gross profit and gross margin — Non-GAAP gross profit is gross profit as reported on our consolidated statements of operations, excluding the impact of stock-based compensation and intangible asset amortization expense. Non-GAAP gross margin is non-GAAP gross profit divided by net revenue.
Non-GAAP operating income and operating margin — Non-GAAP operating income is income from operations as reported on our consolidated statements of operations, excluding the impact of stock-based compensation and intangible asset amortization expense. Non-GAAP operating margin is non-GAAP operating income divided by net revenue.
Non-GAAP net income and diluted income per share — Non-GAAP net income is net income as reported on our consolidated statements of operations, excluding the impact of stock-based compensation, intangible asset amortization expense, and the change in fair value of preferred stock warrants. Non-GAAP diluted income per share is non-GAAP net income divided by the weighted average diluted shares outstanding. Non-GAAP diluted weighted average shares outstanding was computed to give effect to the conversion of all redeemable convertible preferred stock, as if conversion had occurred at the beginning of the period.
For reconciliations of these non-GAAP financial measures to the most directly comparable GAAP financial measures, please see the section of the accompanying tables titled, “Reconciliation of GAAP to Non-GAAP Financial Measures.”
ABOUT RUCKUS WIRELESS
Headquartered in Sunnyvale, CA, Ruckus Wireless (NYSE: RKUS) is a global supplier of advanced wireless systems for the rapidly expanding mobile Internet infrastructure market. With 2012 revenues of $214.7 million, the company offers a wide range of indoor and outdoor "Smart Wi-Fi" products to mobile carriers, broadband service providers, and corporate enterprises, and has more than 21,700 end-customers worldwide. Ruckus technology addresses Wi-Fi capacity and coverage challenges caused by the ever-increasing amount of traffic on wireless networks due to accelerated adoption of mobile devices such as smartphones and tablets. Ruckus invented and has patented state-of-the-art wireless voice, video, and data technology innovations, such as adaptive antenna arrays that extend signal range, increase client data rates, and avoid interference, ensuring consistent and reliable distribution of delay-sensitive multimedia content and services over standard 802.11 Wi-Fi. For more information, visit https://www.ruckuswireless.com.