Press Releases
Phoenix Technologies Ltd. Reports Third Quarter Fiscal 2009 Financial Results
MILPITAS, Calif., July 29, 2009 /PRNewswire-FirstCall via COMTEX News Network/ -- Phoenix Technologies Ltd. (Nasdaq: PTEC), the leader in PC 3.0(TM) products, services and embedded technologies, today reported financial results for the Company's third fiscal quarter, ended June 30, 2009.
(Logo: http://www.newscom.com/cgi-bin/prnh/20070410/SFTU048LOGO)
Financial Highlights
-- Total revenues of $17.3 million, compared to $15.8 million reported in
the second fiscal quarter ended March 31, 2009 and $19.3 million in the
third quarter of fiscal year 2008;
-- GAAP net loss of ($5.8) million, or ($0.20) per share, compared to a net
loss of ($2.8) million, or ($0.10) per share, in the third quarter of
fiscal year 2008;
-- Non-GAAP net loss of ($2.9) million, or ($0.10) per share, (calculated
after adjustments to exclude stock-based compensation expense,
restructuring and related asset impairment charges, impairment of
goodwill and intangible assets and amortization of intangible assets)
compared to non-GAAP net income of $1.3 million, or $0.04 per diluted
share, in the third quarter of fiscal year 2008; and
-- Completion of the previously announced registered direct common stock
offering, raising net proceeds of approximately $12.1 million with
settlement on July 2, 2009.
"We are very pleased to announce better than expected top and bottom line results for the third quarter, which came as a result of both improved sales performance and significantly reduced operating expenses," said President and CEO Woody Hobbs. "We reduced our operating expenses below the level we reported for the March quarter, yet we still continued to invest in our vision for PC 3.0 and the related new product development, customer acquisition, and deployment activities.
"Our FailSafe and HyperSpace offerings are generating broad industry and consumer support, and we believe our strategies for these products are powerful catalysts for both near and long term revenue growth. The first OEM shipments of FailSafe enabled machines began during the third fiscal quarter on schedule. We also successfully expanded our direct engagements with OEMs through advancements in our HyperSpace initiative. In addition to optimizing HyperSpace for AMD's second generation consumer notebook platform, we announced earlier this month that HyperSpace is now aligned with the Moblin open source framework for Intel Atom(TM) Processor-based devices such as netbooks, nettops and MIDs (mobile internet devices). Through this strategic alliance with Intel, we expect to work closely with Intel on the promotion and commercialization of HyperSpace among OEMs and ODMs.
"The trend toward instant on, always connected, all day computing is clearly gaining traction in the marketplace, particularly as netbook and other MID unit shipments and adoption pick up speed. We believe we are in exactly the right place to benefit from this momentum as the business environment rebuilds and as market demand for superior form, function, and performance accelerates," Mr. Hobbs concluded.
Third Quarter Fiscal 2009 Financial Summary
Total revenues for the third quarter of fiscal 2009 ended June 30, 2009 were $17.3 million, compared with $19.3 million in the third quarter of fiscal 2008 ended June 30, 2008. Gross margin for the third fiscal quarter of 2009 was $14.3 million, compared to gross margin of $16.5 million for the third fiscal quarter of 2008. Operating expenses for the third fiscal quarter of 2009 were $18.2 million, compared to operating expenses of $18.4 million for the third fiscal quarter of 2008. Net loss for the third fiscal quarter of 2009 was ($5.8) million, or ($0.20) per share, compared to a net loss of ($2.8) million, or ($0.10) per share, in the comparable year-ago period. The Company ended the third fiscal quarter of 2009 with cash and equivalents of $18.9 million, compared to $22.6 million at March 31, 2009. (On July 2, 2009 the Company completed its previously announced registered direct sale of common stock, generating net proceeds to the company of approximately $12.1 million.)
Conference Call
The Company will conduct its regularly scheduled financial announcement conference call today at 5:30 a.m. PT (8:30 a.m. ET). To participate in the conference call, please dial 877-941-8609 or 480-629-9786. Investors may also access a live audio web cast of this conference call on the investor relations section of the Company's website at http://investor.phoenix.com/webcasts.cfm.
A replay of the webcast will be available approximately two hours after the conclusion of the call and will remain available for 90 calendar days. An audio replay will also be available approximately one hour after the conclusion of the call and will be made available through Wednesday, August 26, 2009. The audio replay can be accessed by dialing 800-406-7325 or 303-590-3030 and entering access ID number 4041377.
About Phoenix Technologies
Phoenix Technologies Ltd. (Nasdaq: PTEC), the leader in PC 3.0(TM) products, services and embedded technologies, pioneers open standards and delivers innovative solutions that enable the PC industry's top system builders and specifiers to differentiate their systems, reduce time-to-market and increase their revenues. The Company's flagship products and services - SecureCore Tiano, Embedded BIOS, Phoenix Freeze, FailSafe, HyperSpace, and eSupport.com -- are revolutionizing the PC user experience by delivering unprecedented performance, security, reliability, continuity, and ease-of-use. The Company established industry leadership and created the PC clone industry with its original BIOS product in 1983. Phoenix has 139 technology patents and 65 pending applications, and has shipped in over one billion systems. Phoenix is headquartered in Milpitas, California with offices worldwide. For more information, visit http://www.phoenix.com.
Phoenix, Phoenix Technologies, Phoenix SecureCore, Embedded BIOS, Phoenix Freeze, FailSafe, HyperSpace, PC 3.0, eSupport.com and the Phoenix Technologies logo are trademarks and/or registered trademarks of Phoenix Technologies Ltd. All other marks are the marks of their respective owners.
To be added to the Company's email distribution for future news releases, please send your request to phoenix@tpg-ir.com.
Use of Non-GAAP Financial Information
To supplement Phoenix's consolidated condensed financial statements presented on a GAAP basis, Phoenix also presents non-GAAP net income (loss) information in this press release. In addition to the charges associated with the impairment of goodwill and intangible assets recorded during the quarter ended March 31, 2009, the adjustments in the current quarter consist principally of stock compensation expense as required according to SFAS 123(R), restructuring and related asset impairment charges primarily associated with reductions in force and the closures of the Company's facilities in Tel Aviv, Israel and Hyderabad, India, and the amortization of intangible assets. These non-GAAP adjustments, as well as management's reasons for providing non-GAAP information, are more fully described in the reconciliation between net loss on a GAAP basis and non-GAAP net income (loss) provided in the financial statements that accompany this press release.
Safe Harbor
The statements set forth above include forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, regarding our ability to improve our financial performance, the deployments of our FailSafe and HyperSpace products, the level of industry and consumer interest in our new products and market trends. These statements involve risk and uncertainties, including: demand for our products and services in adverse economic conditions; our dependence on key customers; our ability to enhance existing products and develop and market new products and technologies successfully; our ability to achieve and maintain profitability and positive cash flow from operations; our ability to meet our capital requirements in the future; our ability to attract and retain key personnel; product and price competition in our industry and the markets in which we operate; our ability to successfully compete in new markets where we do not have significant prior experience; our ability to maintain the average selling price of our core system software for Netbooks; end-user demand for products incorporating our products; the ability of our customers to introduce and market new products that incorporate our products; our ability to generate additional capital on terms acceptable to us; timing of payment by our customers; risks associated with any acquisition strategy that we might employ; costs and results of litigation; failure to protect our intellectual property rights; changes in our relationship with leading software and semiconductor companies; the rate of adoption of new operating system and microprocessor design technology; the volatility of our stock price; risks associated with our international sales and operating internationally, including currency fluctuations, acts of war or terrorism, and changes in laws and regulations relating to our employees in international locations; whether future restructurings become necessary; our ability to complete the transition from our historical reliance on paid-up licenses to volume purchase license agreements and pay-as-you-go arrangements; fluctuations in our operating results and our ability to manage expenses consistent with our revenues; the effects of any software viruses or other breaches of our network security; our ability to convert free users to paid customers and retain customers for our subscription services; unauthorized access to confidential customer information; our ability to manage our rapid growth effectively; defects or errors in our products and services; consolidation in the industry in which we operate; end user customers' high-speed access to the internet and continued maintenance and development of the internet infrastructure; risk associated with use of open source software; our dependence on third party service providers; any material weakness in our internal controls over financial reporting; changes in financial accounting standards and our cost of compliance; business disruptions due to acts of war, power shortages and unexpected natural disasters; trends regarding the use of the x86 microprocessor architecture for personal computers and other digital devices; changes in our effective tax rates; and validity of our tax positions. For a further list and description of risks and uncertainties that could cause actual results to differ materially from those contained in the forward looking statements in this release, we refer you to the Company's filings with the Securities and Exchange Commission, including, but not limited to, its annual report on Form 10-K and quarterly reports on Form 10-Q. All forward-looking statements included in this document are based upon assumptions, forecasts and information available to the Company as of the date hereof, and the Company assumes no obligation to update any such forward-looking statements.
Investor Relations Contacts:
Phoenix Technologies Ltd.
Richard Arnold
Chief Operating Officer and Chief Financial Officer
Tel. +1 408 570 1256
investor_relations@phoenix.com
The Piacente Group, Investor Relations
Kristen McNally
Tel. +1 212 481 2050
phoenix@thepiacentegroup.com
PHOENIX TECHNOLOGIES LTD.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
(unaudited)
June 30, September 30,
2009 2008
---- ----
Assets
Current assets:
Cash and cash equivalents $18,909 $37,721
Accounts receivable, net of
allowances 13,399 6,246
Other assets - current 5,880 8,190
----- -----
Total current assets 38,188 52,157
Property and equipment, net 5,373 4,125
Purchased technology and other intangible
assets, net 7,996 22,323
Goodwill 21,926 54,943
Other assets - noncurrent 3,002 2,994
----- -----
Total assets $76,485 $136,542
======= ========
Liabilities and stockholders' equity
Current liabilities:
Accounts payable $2,121 $2,855
Accrued compensation and related
liabilities 2,965 6,050
Deferred revenue 21,164 15,010
Income taxes payable - current 4,443 4,099
Accrued restructuring charges -
current 123 658
Other liabilities - current 7,273 10,318
----- ------
Total current liabilities 38,089 38,990
Accrued restructuring charges - noncurrent 36 8
Income taxes payable - noncurrent 15,476 13,629
Other liabilities - noncurrent 2,709 2,508
----- -----
Total liabilities 56,310 55,135
Stockholders' equity:
Preferred stock - -
Common stock 30 29
Additional paid-in capital 244,146 235,562
Accumulated deficit (132,031) (61,786)
Accumulated other comprehensive income
(loss) 66 (466)
Less: Cost of treasury stock (92,036) (91,932)
------- -------
Total stockholders' equity 20,175 81,407
------ ------
Total liabilities and stockholders'
equity $76,485 $136,542
======= ========
See notes to unaudited condensed consolidated financial statements
PHOENIX TECHNOLOGIES LTD.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share amounts)
(unaudited)
Three months Nine months
ended June 30, ended June 30,
------------- -------------
2009 2008 2009 2008
---- ---- ---- ----
Revenues:
License fees $14,445 $16,883 $41,557 $47,110
Subscription fees 928 20 2,119 20
Service fees 1,908 2,373 6,789 6,570
----- ----- ----- -----
Total revenues 17,281 19,276 50,465 53,700
Cost of revenues:
License fees 148 179 434 421
Subscription fees 334 20 1,086 20
Service fees 2,053 2,161 6,083 5,678
Amortization of purchased
intangible assets 431 373 2,484 444
Impairment of purchased
intangible assets - - 11,943 -
--- --- ------ ---
Total cost of revenues 2,966 2,733 22,030 6,563
Gross margin 14,315 16,543 28,435 47,137
Operating expenses:
Research and development 9,211 8,397 30,669 20,069
Sales and marketing 3,958 3,245 15,107 8,885
General and administrative 4,655 6,708 15,289 16,221
Restructuring and asset
impairment 360 67 1,502 180
Impairment of goodwill - - 33,213 -
--- --- ------ ---
Total operating
expenses 18,184 18,417 95,780 45,355
------ ------ ------ ------
Income (loss) from operations (3,869) (1,874) (67,345) 1,782
Interest and other income
(expenses), net (502) 328 103 602
---- --- --- ---
Income (loss)
before income taxes (4,371) (1,546) (67,242) 2,384
Income tax expense 1,383 1,234 3,003 4,037
----- ----- ----- -----
Net loss $(5,754) $(2,780) $(70,245) $(1,653)
======= ======= ======== =======
Loss per share:
---------------
Basic and diluted $(0.20) $(0.10) $(2.46) $(0.06)
Shares used in loss per share
calculation:
---------------
Basic and
diluted 28,700 27,574 28,543 27,385
See notes to unaudited condensed consolidated financial statements
PHOENIX TECHNOLOGIES LTD.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
(unaudited)
Three months ended
------------------ Nine months
June 30, March 31, June 30, ended June 30,
-------- --------- -------- ----------------
2009 2009 2008 2009 2008
---- ---- ---- ---- ----
Cash flows
from
operating
activities:
Net loss $(5,754) $(55,148) $(2,780) $(70,245) $(1,653)
Reconciliation
to net cash
provided by
(used in)
operating
activities:
Depreciation
and
amortization 1,014 1,417 868 4,049 1,919
Stock-based
compensation 2,018 2,423 3,605 7,572 8,292
Loss from
disposal/
impairment
of fixed
assets 128 (4) (17) 124 16
Impairment
of
purchased
intangible
assets - 11,943 - 11,943 -
Impairment
of goodwill - 33,213 - 33,213 -
Change in
operating
assets and
liabilities:
Accounts
receivable (5,851) (2,588) 524 (7,089) 2,785
Prepaid
royalties and
maintenance (25) 17 6 (150) 38
Other assets (507) 621 663 (528) 113
Accounts
payable (2) (1,290) 652 (724) 649
Accrued
compensation
and related
liabilities (1,152) 637 322 (3,042) 34
Deferred
revenue 4,935 1,261 (387) 6,241 2,077
Income taxes 1,775 (152) 1,104 2,222 4,311
Accrued
restructuring
charges (338) 95 (132) (499) (1,608)
Other accrued
liabilities 95 (447) (888) (793) (10)
--- ---- ---- ---- ---
Net cash
provided by
(used in)
operating
activities (3,664) (8,002) 3,540 (17,706) 16,963
------ ------ ----- ------- ------
Cash flows
from
investing
activities:
Purchases of property
and equipment and
other intangible
assets (537) (155) (1,027) (1,996) (1,958)
Funds held in escrow - - (18,706) - (18,706)
Acquisition of
businesses, net of
cash acquired - - (17,715) (204) (17,715)
--- --- ------- ---- -------
Net cash used
in investing
activities (537) (155) (37,448) (2,200) (38,379)
---- ---- ------- ------ -------
Cash flows
from
financing
activities:
Proceeds from stock
purchases under
stock
option and stock
purchase plans 218 - 1,173 1,022 4,723
Repurchase of common
stock (12) (52) - (99) -
Principal payments
under capital lease
obligations (61) - - (61) -
--- --- --- --- ---
Net cash
provided by
(used in)
financing
activities 145 (52) 1,173 862 4,723
--- --- ----- --- -----
Effect of
changes in
exchange
rates 346 (391) (149) 232 89
--- ---- ---- --- --
Net decrease in cash
and cash equivalents (3,710) (8,600) (32,884) (18,812) (16,604)
Cash and cash
equivalents at
beginning of period 22,619 31,219 78,985 37,721 62,705
------ ------ ------ ------ ------
Cash and
cash
equivalents
at end of
period $18,909 $22,619 $46,101 $18,909 $46,101
======= ======= ======= ======= =======
See notes to unaudited condensed consolidated financial statements
PHOENIX TECHNOLOGIES LTD.
RECONCILIATION OF GAAP TO NON-GAAP NET INCOME (LOSS) AND
NET EARNINGS (LOSS) PER SHARE
(in thousands, except per share data)
(unaudited)
Three months ended
----------------------------- Nine months
June 30, March 31, June 30, ended June 30,
-------- --------- -------- ---------------
2009 2009 2008 2009 2008
---- ---- ---- ---- ----
GAAP net loss $(5,754) $(55,148) $(2,780) $(70,245) $(1,653)
Equity-based
compensation
expense
under SFAS
No. 123(R) (1) 2,018 2,423 3,605 7,572 8,292
Restructuring
and asset
impairment (2) 360 1,049 67 1,502 180
Amortization
of purchased
intangible
assets (3) 431 910 373 2,484 444
Impairment
of purchased
intangible
assets (4) - 11,943 - 11,943 -
Impairment
of goodwill (4) - 33,213 - 33,213 -
------- ------- ------ -------- ------
Non-GAAP
net income
(loss) $(2,945) $(5,610) $1,265 $(13,531) $7,263
======= ======= ====== ======== ======
Non-GAAP
earnings
(loss) per
share:
------------
Basic $(0.10) $(0.20) $0.05 $(0.47) $0.27
Diluted $(0.10) $(0.20) $0.04 $(0.47) $0.25
Shares used
in earnings
(loss) per share
calculation:
-----------------
Basic 28,700 28,560 27,574 28,543 27,385
Diluted 28,700 28,560 29,253 28,543 29,145
These adjustments reconcile the Company's GAAP net loss to the reported
non-GAAP net income (loss). The Company believes that presentation of net
loss and net income (loss) per share excluding equity-based compensation, restructuring and asset impairment costs, amortization of purchased
intangible assets and impairment of purchased intangible assets and of
goodwill provides meaningful supplemental information to investors, as
well as management, that is indicative of the Company's core operating
results and facilitates comparison of operating results across reporting
periods as well as comparison with other companies. The Company uses these
non-GAAP measures when evaluating its financial results as well as for
internal planning and budgeting purposes. Equity-based compensation is
excluded from non-GAAP results because management believes it is useful to
investors to understand how the expenses associated with SFAS No. 123(R)
are reflected in net income (loss). Restructuring and related asset
impairment costs are excluded from non-GAAP financial results since they
may not be considered directly related to our ongoing business operations.
Amortization of purchased intangible assets, principally purchased
technology, are excluded from non-GAAP financial results since it
generally cannot be changed by management after an acquisition has
occurred. Impairment of purchased intangible assets and goodwill are
excluded from non-GAAP financial results since management believes that
these charges are not directly related to the underlying performance of
the Company's core business operations and eliminating these will assist
investors to compare current versus past operational performance. These
non-GAAP measures should not be viewed as a substitute for the Company's
GAAP results, and may be different than non-GAAP measures used by other
companies.
(1) This represents equity-based compensation expense related to the
Company's adoption of SFAS No. 123(R) beginning October 1, 2005. For the
three months ended June 30, 2009, equity-based compensation was $2.0
million, allocated as follows: $0.1 million to cost of revenues, $0.4
million to research and development, $0.3 million to sales and marketing
and $1.2 million to general and administrative. For the three months
ended March 31, 2009, equity-based compensation was $2.4 million,
allocated as follows: $0.1 million to cost of revenues, $0.7 million to
research and development, $0.3 million to sales and marketing and $1.3
million to general and administrative. For the three months ended June 30,
2008, equity-based compensation was $3.6 million, allocated as follows:
$0.2 million to cost of goods sold, $1.0 million to research and
development, $0.4 million to sales and marketing and $2.0 million to
general and administrative. For the nine months ended June 30, 2009,
equity-based compensation was $7.6 million, allocated as follows: $0.4
million to cost of goods sold, $2.1 million to research and development,
$1.0 million to sales and marketing and $4.1 million to general and
administrative. For the nine months ending June 30, 2008, equity-based
compensation was $8.3 million, allocated as follows: $0.4 million to cost
of goods sold, $2.1 million to research and development, $1.0 million to
sales and marketing and $4.8 million to general and administrative.
Management believes that it is useful to investors to understand how the
expenses associated with the adoption of SFAS No. 123(R) are reflected in
net income.
The quarter ended March 31, 2008 is the first quarter during in which the
Company reported equity-based compensation expense under SFAS No. 123(R)
in respect of stock options granted to the Company's four most senior
executives as approved by the Company's stockholders on January 2, 2008
(the "Performance Options"). Of the $2.0 million of equity-based
compensation for the three months ended June 30, 2009, $0.9 million was
due to equity-based compensation expense which resulted from the grant of
the Performance Options. Of the $2.4 million of equity-based compensation
for the three months ended March 31, 2009, $1.0 million was due to equity-
based compensation expense which resulted from the grant of the
Performance Options. Of the $3.6 million of equity-based compensation for
the three moths ended June 30, 2008, $2.0 million was due to equity-based
compensation expense which resulted from the grant of the Performance
Options. Of the $7.6 million of equity-based compensation for the nine
months ended June 30, 2009, $3.5 million was due to equity-based
compensation expense which resulted from the grant of the Performance
Options. Of the $8.3 million of equity-based compensation for the nine
months ended June 30,2008, $5.8 million was due to equity-based
compensation expense which resulted from the grant of the Performance
Options.
(2) The Company has incurred restructuring and resulting asset impairment
expenses, included in its GAAP presentation of operating expenses,
primarily due to workforce related charges such as payments for severance
and benefits, asset impairments, estimated costs of exiting and
terminating facility lease commitments and other exit costs related to
formal restructuring plans approved by the Board of Directors/management
in June 2006, September 2006, November 2006, September 2007, February
2009, March 2009 and June 2009. For the three months ended June 30, 2009,
restructuring and related asset impairment costs totaled $0.4 million,
which relates mainly to the severance, other employee related costs, asset
impairments, and other exit costs incurred in relation to the
restructuring plans announced during the second and third quarters of
fiscal year 2009. As part of the current quarter restructuring
activities, the Company consolidated its development activities in India
location by closing its facility in Hyderabad, India. For the three
months ended March 31, 2009, restructuring costs totaled $1.0 million,
which relates mainly to the severance and other employee related costs
incurred in relation to the two restructuring plans announced during the
quarter ended March 31, 2009. As part of these restructuring activities,
the Company reduced its global workforce by 96 employees and closed its
facility in Tel Aviv, Israel. For the three months ended June 30, 2008,
cost related to exiting and terminating 2 facility leases totaled
approximately $0.1 million due to a change in estimate of sublease income.
For the nine months ended June 30, 2009, restructuring costs totaled $1.5
million, out of which $1.2 million relates to the severance and other
employee related cost incurred in relation to the three restructuring
plans announced during the quarters ended March 31, 2009 and June 30, 2009
and $0.3 million relates to facilities, lease, asset impairments, and
other exit costs. For the nine months ended June 30, 2008, restructuring
costs were $0.2 million which were composed of severance and benefits
costs of approximately $80,000 and facilities lease costs of approximately
$0.1 million. The Company believes that these items do not reflect
expected future operating expenses nor does the Company believe that they
provide a meaningful evaluation of current versus past operational
performance.
(3) This represents amortization of purchased intangible assets,
principally purchased technology, in accordance with SFAS No. 144,
"Accounting for the Impairment or Disposal of Long-Lived Assets" ("SFAS
No. 144") and SFAS No. 86, "Accounting for the Costs of Computer Software
to Be Sold, Leased, or Otherwise Marketed" ("SFAS No. 86"). Amortization
of purchased intangible assets is allocated to cost of revenues. For the
three months ended June 30, 2009, intangible assets was $0.4 million,
which primarily include the amortization of the acquired assets from the
acquisitions completed in the second half of fiscal year 2008. For the
three months ended March 31, 2009, amortization of purchased intangible
assets was $0.9 million, which primarily include the amortization of the
acquired assets from the acquisitions completed in the second half of
fiscal year 2008. For the three months ended June 30, 2008, amortization
of purchased intangible assets was $0.4 million. For the nine months
ended June 30, 2009, amortization of purchased intangible assets was $2.5
million, which primarily include the amortization of the acquired assets
from the acquisitions completed in the second half of fiscal year 2008.
For the nine months ended June 30, 2008, amortization of purchased
intangible assets was $0.4 million. Future acquisitions may cause
amortization expenses to be higher than these amounts.
(4) This represents impairment of goodwill and purchased intangible assets
in accordance with SFAS No. 142, "Goodwill and Other Intangible Assets"
("SFAS No. 142"), SFAS No. 144, "Accounting for the Impairment or Disposal
of Long-Lived Assets" ("SFAS No. 144") and SFAS No. 86, "Accounting for
the Costs of Computer Software to Be Sold, Leased, or Otherwise Marketed"
("SFAS No. 86"). For the three months ended June 30, 2009, there were no
impairment charges recorded on purchased intangible assets or goodwill.
For the three months ended March 31, 2009, impairment of purchased
intangible assets was $11.9 million and impairment of goodwill was $33.2
million, which include the impairments of the acquired assets from recent
acquisitions. There were no impairment charges recorded on purchased
intangible assets or goodwill in the other periods presented. SFAS 142
and SFAS 144 adjustments typically occur when the financial performance of
the business utilizing the affected assets falls below certain thresholds
or certain assets are designated as held for sale. Accordingly, SFAS 142
and SFAS 144 related asset impairment are generally unpredictable and
several factors could result in further impairment of the remaining
goodwill and other intangible assets in the future periods.
SOURCE Phoenix Technologies Ltd.
http://www.phoenix.com
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