Intermolecular Inc (IMI)
Q1 2013 Earnings Call
March 25, 2013 04:30 am ET
Gary Hsueh - Sr. Director of Corporate Development and Investor Relations
Dave Lazovsky - Founder, President and Chief Executive Officer
Peter Eidelman - Chief Financial Officer
Harlan Sur - JPMorgan
Edwin Mok - Needham & Company
Weston Twigg - Pacific Crest Securities
Joseph Moore - Morgan Stanley
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I would now like to turn the call over to Gary Hsueh, Senior Director of Corporate Development and Investor Relations. Please go ahead, sir.
Thank you, Jamie. Good afternoon and welcome to Intermolecular's first quarter 2013 earnings conference call. We announced results after the close today and you’ll find a copy of the press release on our website at www.intermolecular.com. On the call with us today are, Dave Lazovsky, President and Chief Executive Officer and Peter Eidelman, Chief Financial Officer.
Today's conference call contains forward-looking statements. Any statement that refers to expectations, projections or other characterizations of future events including any statements that relate to our expectation that Micron or consummated acquisition of Elpida, as well as any statement regarding financial projections and future market conditions is a forward-looking statement.
Actual results may differ materially from those expressed in these forward-looking statements. Intermolecular assumes no obligation to update these forward-looking statements, which speak only as of today. For more information about factors that may cause actual results to differ materially from forward-looking statements, please refer to the press release we issued today as well as the risks described in our Form 10-K for fiscal 2012 as filed with the SEC, particularly in section title Risk Factors.
Before we begin, please note that during this call we will discuss non-GAAP financial measures as defined by the SEC, Regulation G. We believe non-GAAP financial measures provide useful supplemental information to both, management and investors, but note that these measurements are not a substitute for GAAP and should only be used to evaluate the company’s results of operations in conjunction with corresponding GAAP measures. All non-GAAP measures are reconciled to the most directly comparable GAAP financial measures in our press release issued today.
With that, I'll now turn the call over to Dave.
Thanks, Gary. Good afternoon, everyone, and thank you for joining us on today’s call and webcast. Q1 was an eventful quarter for Intermolecular which successfully led to an agreement with Micron for a multi-year collaborative development program and IP licensing agreement spanning DRAM and its non-volatile memory.
We also signed an agreement with Elpida that extends the development period under the Elpida CDP. We announced the signing of these contracts with Micron and Elpida last week. These deals will transition our CDP and IP licensing agreement with Elpida to Micron upon the closing of Micron’s acquisition of Elpida and will also meaningfully expand the scope and scale of our engagement to include Micron’s non-volatile memory products. As a result of having these agreements in place before the acquisition closes, we do not expect any disruption to our ongoing R&D activity on low power mobile DRAM. I’ll discuss this collaboration in more detail in a moment.
Another recent milestone for us was the CDP and IP incensing agreement that we signed with Epistar. This represents our formal entry into the LED market. Our ability to enter the LED market with a Tier-1 industry leading player is a testament to the broad applicability of our HPC platform to drive R&D innovation across solid state thin-film technologies. We executed our diversification strategy last year in establishing CDP and IP licensing agreement with First Solar. So far this year, we've added Epistar in LED and we've aligned internal R&D and resources to support continued diversification to the display market this year.
In terms of financials, we reported revenue of $17.4 million and non-GAAP breakeven or $0.00 per share, in line with our execution plan and guidance. Beneath these headline financials, is the fact that with Micron's entry into a multi-year CDP and licensing agreement for DRAM and on-volatile memory and with the extension of our strategic engagement with Toshiba and SanDisk, we've expanded our market penetration in memory and built our current total backlog to meaningfully exceed 2011 year-end levels.
Before discussing more specifics, I’d like to provide more perspective on the company’s current position and how we are aligning management for the company’s growth for the years ahead. The highest priority within the company has always been to focus on delivering return on investment on our existing CDPs and to help ensure that developed technology and IP moves into production.
As many of our CDPs and semiconductors mature and approach IP commercialization, we are raising the bar for ROI. To aggressively address this rising bar, I’m pleased to welcome Dr. Raj Jammy to Intermolecular’s Executive Management Team, as Senior Vice President and General Manger of the Semiconductor Group.
Raj has had an accomplished carrier in semiconductors at IBM, and more recently at Symantec as VP of Materials and Emerging Technologies. He is a highly regarded industry veteran and expert, and I look forward to his leadership in semiconductors to contribute meaningfully to growth in the years ahead.
Coming back to Micron, as one of the key foundations for growth, the CDP and IP licensing agreement with Micron represents a milestone for the company and establishes the framework for monetization of our existing developed IP and DRAM and maps our green field IP licensing opportunities in non-volatile memory.