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Tessera Technologies Inc. (TSRA)
Q3 2010 Earnings Call
October 28, 2010 05:00 pm ET
Moriah Shilton - IR
Hank Nothhaft - Chairman & CEO
Mike Anthofer - CFO
Barney Cassidy - General Counsel
Mike Bereziuk - EVP Imaging and Optics
Craig Mitchell - SVP Interconnect, Components and Materials
Kelly Anderson - Sidoti
Paul Thomas - Bank of America-Merrill Lynch
Kevin Vassily - Pacific Crest
Michael Cohen - MDC Financial Research
Previous Statements by TSRA
» Tessera Technologies, Inc. Q2 2010 Earnings Call Transcript
» Tessera Technologies Inc. Q1 2010 Earnings Call Transcript
» Tessera Technologies, Inc. Q4 2009 Earnings Call Transcript
» Tessera Technologies, Inc. Q2 2009 Earnings Call Transcript
Thank you. Ms. Shilton, you may begin your conference.
Thank you, Doris, and good afternoon everyone. Thank you for joining us for the call today. This call is being broadcast live over the Internet. A webcast replay will be available at tessera.com for 90 days after the call.
In addition, a telephone replay of this call will be made available for two business days beginning approximately two hours after the completion of this call. To listen to the replay in the US, please dial 800-642-1687, and internationally dial 706-645-9291. The access code is 16336767.
I will now read a short Safe Harbor statement. During the course of this conference call, management will make a number of forward-looking statements, which are statements regarding future events, including the future financial performance of the Company. These forward-looking statements are made pursuant to the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995.
Forward-looking statements involve risks and uncertainties that could cause actual results to differ significantly from those projected. You're cautioned not to place undue reliance on the forward-looking statements, which speak only as of the date of this call. More information about factors that may cause results to differ from the projections made in these forward-looking statements can be found in Tessera's filings with the Securities and Exchange Commission, including its annual report on Form 10-K for the year ended December 31, 2009 and its quarterly reports on Form 10-Q, especially the sections of these filings entitled Risk Factors. The Company disclaims any obligation to publicly update or revise any forward-looking statements to reflect events or circumstances that occur after this call.
On the call today from management are Hank Nothhaft, Tessera's Chairman and Chief Executive Officer; Mike Anthofer, Chief Financial Officer; Barney Cassidy, General Counsel; Mike Bereziuk, Executive Vice President Imaging and Optics; and Craig Mitchell, Senior Vice President Interconnect, Components and Materials.
During this call today, management may discuss certain non-GAAP financial measures for comparison purposes only. The non-GAAP amounts of cost of revenues, research and development, selling, general and administrative expenses, net income, and earnings per share do not include the following, stock-based compensation expense; acquired intangible; amortization charges; charges for acquired in-process research and development; impairment charges on long-lived assets; and related tax effects.
Management believes the non-GAAP amounts provide a more meaningful comparison measure of quarter-over-quarter and year-over-year financial performance. Please refer to the Company's third quarter 2010 earnings press release and to the Company's website for a reconciliation of non-GAAP measures to GAAP. After management's brief opening remarks, we will open the call to your questions.
And with that, I'll turn the call over to Hank.
Thank you, Moriah. Good afternoon and welcome to Tessera's quarterly earnings call. Before I open the call for your questions, I wanted to remind everybody that we had changed the format of the call last quarter, and we are continuing to use the same format going forward.
In lieu of reading a long script and then answering Q&A, we're posting a detailed summary of the quarter on our website at tessera.com in the Investors section, so that we have more time for Q&A during the actual call itself.
I will offer a few thoughts on our third quarter of 2010 and recent activities. We had an excellent quarter. Our total revenues of $82.1 million were a record for revenue, excluding settlements, and were up 24% from last year's third quarter and 10% from the second quarter of 2010.
Our two business segments, Microelectronics and Imaging and Optics, also grew substantially. Microelectronics revenues of $72 million were up 22% from last year's quarter, and Imaging and Optics revenues of $10.1 million were up 42% from the third quarter of 2009.
GAAP net income for the third quarter of 2010 was $19 million, or $0.38 per share. Cash, cash equivalents and investments increased $36.2 million during the third quarter, resulting in $474 million at the end of the quarter.
In Microelectronics, we successfully renewed our license agreement with Fujitsu. We also took steps to protect our intellectual property by filing two lawsuits against companies who are using our innovative technology without making proper compensation to us.
In Thermal Management, we continue to make progress in our silent air cooling development efforts and are excited about the increasing level of interest for this technology from OEMs in our first target market, ultra-thin LED laptops.
In Imaging and Optics, our extended depth of field or EDOF technology continues to gain market adoption. And our Imaging and Optics EDOF royalties nearly tripled in the third quarter of 2010 as compared to the third quarter of 2009. Camera phones capable of still as well as video image processing are also gaining market share. We are participating in this growing market through our video tools technology.