POLYCOM INC

CIK:0001010552|SEC Filings

Condensed Consolidated Statements of Operations (Unaudited) - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Revenues:
Product revenues	$ 201,715	$ 221,896	$ 404,975	$ 455,583
Service revenues	86,064	94,679	172,879	191,692
Total revenues	287,779	316,575	577,854	647,275
Cost of revenues:
Cost of product revenues	94,029	95,752	189,084	197,021
Cost of service revenues	32,478	34,898	63,669	71,509
Total cost of revenues	126,507	130,650	252,753	268,530
Gross profit	161,272	185,925	325,101	378,745
Operating expenses:
Sales and marketing	82,505	89,433	161,968	180,292
Research and development	43,981	46,545	87,051	95,882
General and administrative	20,291	22,269	40,401	43,436
Amortization of purchased intangibles	2,017	2,417	4,217	4,834
Restructuring costs	6,007	343	13,509	367
Transaction-related costs	7,887		12,131
Total operating expenses	162,688	161,007	319,277	324,811
Operating (loss) income	(1,416)	24,918	5,824	53,934
Interest and other income (expense), net:
Interest expense	(1,668)	(1,523)	(3,305)	(3,007)
Other income (expense), net	1,966	1,345	2,835	1,367
Interest and other income (expense), net	298	(178)	(470)	(1,640)
(Loss) income before provision for income taxes	(1,118)	24,740	5,354	52,294
Provision for income taxes	8,879	5,093	12,016	11,449
Net (loss) income	$ (9,997)	$ 19,647	$ (6,662)	$ 40,845
Basic net (loss) income per share	$ (0.07)	$ 0.15	$ (0.05)	$ 0.30
Diluted net (loss) income per share	$ (0.07)	$ 0.14	$ (0.05)	$ 0.30
Number of shares used in computation of net (loss) income per share:
Basic	135,700	134,057	134,934	134,417
Diluted	135,700	137,347	134,934	138,290

Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015
Cash flows from operating activities:
Net (loss) income	$ (6,662)	$ 40,845
Adjustments to reconcile net (loss) income to net cash provided by operating activities:
Depreciation and amortization	23,663	27,210
Amortization of purchased intangibles	4,417	5,629
Amortization of capitalized software development costs for products to be sold	2,140	1,354
Amortization of debt issuance costs	267	266
Amortization of discounts and premiums on investments, net	645	1,090
Write-down of excess and obsolete inventories	5,477	6,810
Stock-based compensation expense	33,087	18,943
Excess tax benefits from stock-based compensation expense	(1,405)	(3,487)
Loss on disposal of property and equipment	175	544
Changes in assets and liabilities:
Trade receivables	33,601	8,245
Inventories	(12,880)	(6,791)
Deferred taxes	(4,435)	(2,744)
Prepaid expenses and other assets	2,362	4,960
Accounts payable	4,058	(19,229)
Taxes payable	5,296	9,663
Other accrued liabilities and deferred revenue	(17,540)	(30,160)
Net cash provided by operating activities	72,266	63,148
Cash flows from investing activities:
Purchases of property and equipment	(13,508)	(23,922)
Capitalized software development costs for products to be sold	(1,446)	(2,311)
Purchases of investments	(78,222)	(107,675)
Proceeds from sales of investments	13,937	6,892
Proceeds from maturities of investments	149,699	97,187
Net cash provided by (used in) investing activities	70,460	(29,829)
Cash flows from financing activities:
Proceeds from issuance of common stock under employee option and stock purchase plans	10,811	12,528
Payments on debt	(3,126)	(3,125)
Purchase and retirement of common stock under share repurchase plan		(64,999)
Purchase and retirement of common stock for tax withholdings on vesting of employee stock-based awards	(9,772)	(11,769)
Excess tax benefits from stock-based compensation expense	1,405	3,487
Net cash used in financing activities	(682)	(63,878)
Effect of exchange rate changes on cash and cash equivalents	(621)
Net increase (decrease) in cash and cash equivalents	141,423	(30,559)
Cash and cash equivalents, beginning of period	435,093	443,132
Cash and cash equivalents, end of period	$ 576,516	$ 412,573

Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands	Jun. 30, 2016	Dec. 31, 2015
Current assets
Cash and cash equivalents	$ 576,516	$ 435,093
Short-term investments	126,238	184,242
Trade receivables, net	154,212	187,888
Inventories	96,748	89,392
Prepaid expenses and other current assets	50,118	52,852
Total current assets	1,003,832	949,467
Property and equipment, net	93,123	101,853
Long-term investments	18,788	46,484
Goodwill	558,659	558,775
Purchased intangibles, net	9,648	14,065
Deferred taxes	86,659	89,865
Other assets	20,994	21,738
Total assets	1,791,703	1,782,247
Current liabilities
Accounts payable	78,444	73,472
Accrued payroll and related liabilities	32,977	38,781
Taxes payable	2,130	4,342
Deferred revenue	174,119	170,559
Current portion of long-term debt	5,717	5,717
Other accrued liabilities	74,607	85,095
Total current liabilities	367,994	377,966
Long-term deferred revenue	83,272	86,191
Taxes payable	10,382	9,983
Deferred taxes		135
Long-term debt	225,940	228,799
Other non-current liabilities	24,074	25,964
Total liabilities	711,662	729,038
Commitments and contingencies (Note 8)
Stockholders' equity
Common stock, $0.0005 par value; authorized: 350,000,000 shares; issued and outstanding: 135,771,115 shares at June 30, 2016 and 132,665,165 shares at December 31, 2015	68	66
Additional paid-in capital	1,202,263	1,167,701
Accumulated deficit	(120,017)	(113,355)
Accumulated other comprehensive loss	(2,273)	(1,203)
Total stockholders' equity	1,080,041	1,053,209
Total liabilities and stockholders' equity	$ 1,791,703	$ 1,782,247