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Dialogic Inc. Reports Second Quarter 2011 Financial Results

Stocks in this article: DLGC

Dialogic Inc. (NASDAQ:DLGC), a leading provider of communications technologies that power advanced networks, today announced second quarter financial results for the period ending June 30, 2011.

“This quarter we achieved the highest quarterly revenue in our company’s history,” said Nick Jensen, Dialogic’s Chairman and Chief Executive Officer. “We saw strong demand for our NextGen products including our newest Bandwidth Optimization, Video and Infrastructure products in the world’s fastest growing mobile networks markets, specifically in the BRIC countries and the MEA region. These NextGen products made up 69% of second quarter non-GAAP revenues, a record level versus 61% in the first quarter of 2011. In the second quarter, we also recognized our first revenue on our new Mobile Backhaul products. We anticipate that revenues for the Mobile Backhaul and Video products will grow significantly in future quarters as mobile operators expand network capacity to address the demand for data services.”

Financial Results

On a GAAP basis, Dialogic achieved the following financial results for the second quarter 2011 as compared to the results of the first quarter of 2011:

  • Revenue of $55.8 million, as compared to $44.9 million
  • Gross Margin of 59% as compared to 57%
  • Operating Expense of $38.2 million, as compared to $42.6 million
  • Net Loss attributable to common shareholders of $11.3 million or $0.36 per share, as compared to $21.3 million or $0.68 per share

As reflected below in the reconciliation of the second quarter 2011 Statement of Operations to Adjusted EBITDA, on a non-GAAP basis, Dialogic achieved the following financial results for second quarter 2011 as compared to the results of the first quarter 2011:

  • Revenue of $58.7 million, as compared to $45.9 million
  • Gross Margin of 62%, as compared to 63%
  • Operating Expenses of $33.4 million, as compared to $35.0 million
  • Adjusted EBITDA of $3.1 million, as compared to $(6.1) million

“In the second quarter, we saw several trends which are indicative of our business. First, the investments we have made over the previous quarters in video and mobile backhaul optimization products are now starting to contribute to our results, through contracts with customers and partners like Telefonica and Nokia Siemens Networks. Second, as we have stated in previous quarters, we expect to see declining revenues from the Legacy products, which are mostly the TDM based board and blade business. Those applications are increasingly transitioning from special purpose hardware to IP Media Server software running on general purpose servers. As the Legacy business declines, it is being replaced by the growth from our NextGen products. Also, our Class 4 Softswitch continues to win significant design wins worldwide. Our book to bill for the second quarter was slightly below one, but is slightly above one for the first half of 2011.”

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