Avici narrows losses in Q4 - Financial Results - Avici Systems Inc

Fiber Optics Weekly Update, Feb 6, 2004

Avici Systems reported its fourth quarter and full year results for the periods ended December 31, 2003.

Gross revenue for the fourth quarter and full year ended December 31, 2003 was $11.5 million and $39.4 million, respectively, compared to $7.3 million and $33.1 million in the comparable periods ended December 31, 2002, representing an increase of 57.5 percent compared to the prior year's fourth quarter and an annual increase of 19 percent. Revenue, net of common stock warrant discount, for the three and twelve month periods ended December 31, 2003 was $11.5 million and $37.0 million, respectively, compared to $6.5 million and $29.9 million for the same periods last year. Common stock warrant discount associated with a previous transaction has been reported as a reduction of gross revenue during the three year period ended September 30, 2003 and was fully amortized at that date.

GAAP net loss for the fourth quarter ended December 31, 2003 was $3.9 million, or $0.32 per share compared to a GAAP net loss of $14.1 million, or $1.13 per share in the prior year fourth quarter. GAAP net loss for the 2003 and 2002 fourth quarters includes $0.1 million and $1.5 million, respectively, for non-cash equity based charges, a credit of $0.5 million in the fourth quarter of 2003 for the utilization of certain inventory previously estimated to be in excess of foreseeable requirements, and other income of $3.0 million related to the expiration of certain customer credits.

GAAP net loss and net loss per share for the year ended December 31, 2003 were $37.0 million, or $3.02 per share compared to $64.8 million, or $5.20 per share for the comparable year ended December 31, 2002. GAAP net loss for the 2003 and 2002 annual periods includes $3.5 million and $7.4 million, respectively for non-cash equity based charges, credits of $1.9 million and $2.5 million, respectively for the utilization of certain inventory previously estimated to be in excess of foreseeable requirements, and in 2003, other income of $3.0 million related to the expiration of certain customer credits, and in 2002, restructuring charges of $0.9 million and a $0.3 million credit from the settlement of an insurance claim.

Non-GAAP net loss (GAAP net loss excluding the above charges and credits) and net loss per share for the three months ended December 31, 2003 and 2002 were $7.3 million, or $0.60 per share compared to $12.6 million, or $1.01 per share, respectively. Non-GAAP net loss and net loss per share for the year ended December 31, 2003 were $38.4 million, or $3.14 per share compared to $59.2 million or $4.76 per share for the prior year ended December 31, 2002.

Cash, marketable securities and longterm marketable securities totaled $96 million at December 31, 2003. Total utilization of these items for 2003 was $29 million, reduced from $39 million in 2002.