Violin Memory: Fiscal 4Q14 Financial Results

Violin Memory, Inc. announced financial results for its fourth fiscal quarter and full fiscal year ended January 31, 2014.

Fourth Quarter Fiscal 2014 Financial Highlights

• revenue of $28 million
• GAAP gross margin of 22%
• non-GAAP gross margin of 56%
• GAAP net loss of $0.68 per share
• non-GAAP net loss of $0.28 per share

Fiscal Year 2014 Financial Highlights

• revenue of $107.7 million
• GAAP gross margin of 40%
• non-GAAP gross margin of 50%
• net loss of $3.88 per share
• non-GAAP net loss of $2.54 per share

“Throughout our fourth quarter and full year, we continued to gain some of the largest IT customers in the world because our technology can fundamentally transform the way they do business,” said Kevin DeNuccio, president and CEO, Violin. “Violin continues to demonstrate that it is one of the few franchises well positioned to capitalize on the future of storage and lead the market in its transition to the all-silicon data center.”

Fourth Quarter Fiscal 2014 Financial Results
Fourth quarter fiscal 2014 revenue was $28 million, 22% higher year over year compared to $22.9 million recorded in the fourth fiscal quarter of 2013, and slightly lower compared to $28.3 million reported in the third fiscal quarter of 2014.

Fourth quarter fiscal 2014 GAAP gross margin was 22%, reflecting a $9.2 million charge associated with PCIe card inventory, and compares to 40% recorded in the fourth fiscal quarter of 2013, and to 54% reported in third fiscal quarter of 2014.

Fourth quarter fiscal 2014 non-GAAP gross margin was 56%, compared to 41% recorded in the fourth fiscal quarter of 2013, and compared to 55% reported in third fiscal quarter of 2014.

Fourth quarter fiscal 2014 GAAP net loss was $56.5 million, or $0.68 per share, compared to fourth quarter fiscal 2013 GAAP net loss of $35.4 million, or $2.41 per share. Fourth quarter fiscal 2014 GAAP results compare to third quarter fiscal 2014 GAAP net loss of $34.1 million, or $0.85 per share.

Fourth quarter fiscal 2014 GAAP net loss included a net charge of $33.1 million from special items, consisting primarily of stock-based compensation expense of $18.2 million, PCIe card inventory provision of $9.2 million, restructuring charges of $4.9 million, impairment of cost method investment of $0.7 million and amortization of acquired intangibles of $0.1 million.

Excluding special items, fourth quarter fiscal 2014 non-GAAP net loss was $23.5 million, or $0.28 per share, compared to fourth quarter fiscal 2013 non-GAAP net loss of $30.2 million, or $2.06 per share. Fourth quarter fiscal 2014 non-GAAP results compare to third quarter fiscal 2014 non-GAAP net loss of $25.4 million, or $0.63 per share.

Fiscal Year 2014 Financial Results
Fiscal year 2014 revenue was $107.7 million, 46% higher year over year compared to $73.8 million recorded in fiscal year 2013.

Fiscal year 2014 GAAP net loss was $149.8 million, or $3.88 per share, compared to fiscal year 2013 GAAP net loss of $109.1 million, or $8.01 per share.

Fiscal year 2014 GAAP net loss included a net charge of $52 million from special items, consisting primarily of stock-based compensation expense of $36.4 million, PCIe card inventory provision of $9.2 million, restructuring charges of $4.9 million, impairment of cost method investment of $0.7 million, amortization of acquired intangibles of $0.4 million and litigation settlement of $0.4 million.

Excluding special items, fiscal year 2014 non-GAAP net loss was $97.9 million, or $2.54 per share, compared to fiscal year 2013 non-GAAP net loss of $91.2 million, or $6.69 per share.

Cash and short-term investments totaled approximately $99 million at fiscal year-end.

Fiscal Year 2015 Business Outlook

• non-GAAP gross margin of 52% to 56%
• non-GAAP operating expenses of $115 million to $125 million