Smith Micro Software CEO Discusses Q3 2010 Results - Earnings Call Transcript
Smith Micro Software Inc. (
)
Q3 2010 Earnings Call
November 03, 2010 04:30 am ET
Executives
Charles Messman - IR
Bill Smith - President and CEO
Andy Smith - CFO
Tom Matthews - CSO
Analysts
Rich Valera - Needham
Chad Bennett - Northland Capital Markets
Scott Searle - Merriman capital
Larry Harris - CL King
Scott Sutherland - Wedbush Securities
Tim Joseson - Zach Investment Research
Presentation
Operator
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Smith Micro Software Inc. Q3 2009 Earnings Call Transcript
Good afternoon ladies and gentlemen, thank you for standing by. Welcome to the Smith Micro third quarter 2010 earnings conference call. During today’s presentation all parties will be in a listen-only mode. Following the presentation, the conference will be open for questions. (Operator Instructions). This conference is being recorded today, Wednesday, November 3rd, 2010. I would now like to turn the conference over to Mr. Charles Messman. Please go ahead sir.
Charles Messman
Good afternoon and thank you for joining us today to discuss Smith Micro Software financial results for our first quarter ended September 30, 2010. By now you should have received a copy of the press release discussing our quarter results. If you do not have a copy and would like one, please visit us at www.smithmicro.com, or you can call us at 949-362-5800 and we will immediately email you one.
With me on today’s call are Bill Smith, Chairman, President and Chief Executive Officer; Andy Schmidt, Chief Financial Officer; and Tom Matthews, Chief Strategy Officer. Before we begin the call, I want to caution that on this call, the company may make forward-looking statements that involve risks and uncertainties, including without limitation forward-looking statements related to the company’s revenue guidance for fiscal 2010, its financial prospects and other projections of its performance, the company’s ability to increase its business and the anticipated timings and financial performance of its new products and potential acquisitions.
Among the important factors that could cause the actual results to differ materially from those expressed or implied in the forward-looking statements are changes in demand for the company’s product from its customers and their end-users, new and changing technologies, customer's acceptance of those technologies, new and continuing adverse economic conditions, and the company’s ability to compete effectively with other software companies.
These and other factors are discussed in the company’s filings with the Securities and Exchange Commission, including its filings on Forms 10-K and 10-Q, and could cause actual results to differ materially from those expressed or implied in any forward-looking statements. The forward-looking statements contained in this release are made on the basis of the views and assumptions of management regarding future events and business performance as of the date of this call, and the company does not undertake any obligation to update these statements to reflect events or circumstances occurring after the date of the call. At this time I’d now like to turn the call over to Bill Smith, Chairman, President, and CEO, Smith Micro. Bill?
Bill Smith
Thank you Charles. Good afternoon, everyone, and welcome to our third quarter ending September 30th, 2010 earnings conference call. We are pleased to report another great quarter with solid financial results. We posted our sixth consecutive quarter of revenue growth generating the highest quarterly revenue results in our company’s history of $34 million. This represents an improvement of 6.2 million over Q3 2009 or a 22.2% increase in revenue or with the same period last year.
In addition to our strong revenue growth in the quarter, our bottom line was very solid with non-GAAP net income up 19.6% over Q3 2009. Our non-GAAP net income of 7.9 million or $0.23 per share compared to 6.6 million or $0.20 per share in the third quarter of 2009. We are delighted with our third quarter results along with our continuing record of consecutive revenue growth over the past year and a half.
For the past nine months, we've made great progress towards fulfilling our financial goals for 2010. We successfully met our key operational initiatives designed to prepare our company for the growth opportunities we expect will develop over the next several years.
We are about to embark on a new era of broadband mobile internet services with an eminent launch of LTE. These new higher feed services will enable our ability to serve and expanding audience of users with the adoption potential and demographic characteristics that are much broader than today’s mobile broadband user base.
We view the upcoming quarters where we expect LTE to launch an earnest at the beginning of the next growth phase in Smith Micro's history. And I have to say we are pretty excited about what we see ahead of us with our continuing roll out for 4G, WiMAX, and LTE networks.
Revenues generated from our wireless and mobility product sales, continues to drive the growth within our business. Our wireless and mobility unit posted 31.3 million in Q3, which is up a very strong 38.3% year-over-year. This represents an increase in the revenues of 11% or $3 million over the prior quarter.
Revenue from this unit accounted for over 92% of the total revenue for the company in the quarter. We see this increasing sales volume as evidence that our customers are pleased with the value proposition for our smart mobility software products and platforms.
Before I get into discussing the quarter and our future prospects, I'd like to turn the call over to Andy Smith, our CFO to discuss the third quarter financial results in more detail. Andy?
Andy Smith
Thank you, Bill. First, let me go over customary introductory items. As we have in past quarters, we have provided non-GAAP results and a reconciliation of non-GAAP and GAAP results. The non-GAAP results discussed in this call net out amortization of intangibles associated with acquisitions, stock compensation related expenses and non-cash tax expense to provide our comparable operating results.
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