MILPITAS, Calif., Nov. 12,
2018 /PRNewswire/ -- Lumentum Holdings Inc. ("Lumentum" or the
"Company") today announced updated business outlook for its fiscal
second quarter 2019 based on a recent customer
development.
"We recently received a request from one of our largest
Industrial and Consumer customers for laser diodes for 3D sensing
to materially reduce shipments to them during our fiscal second
quarter for previously placed orders that were originally scheduled
for delivery during the quarter," said Alan
Lowe, President and CEO. "With our proven ability to deliver
high volumes, years of experience, hundreds of millions of devices
in the field, and new product and customer funnel, we remain
confident in our leadership position in the nascent market for
laser diodes for 3D sensing."
Revised Net revenue, non-GAAP operating margin, and non-GAAP
diluted earnings per share expectations along with the prior
guidance range provided in the Company's fiscal first quarter
earnings release and earnings conference call on November 1, 2018 are provided in the table
below.
Updated and
prior business outlook for fiscal second quarter
2019:
|
|
|
Updated
Range
|
Prior
Range
|
Net
revenue
|
$335 million to $355
million
|
$405 million to $430
million
|
Non-GAAP operating
margin
|
23.0% to
25.0%
|
28.0% to
30.0%
|
Non-GAAP diluted net
income per share
|
$1.15 to
$1.34
|
$1.60 to
$1.75
|
|
Note: Net
income per share is based on approximately 65.9 million shares
outstanding on a fully diluted basis
|
Our projection of 65.9 million shares outstanding does not
include the potentially dilutive effect of the convertible notes,
as we have the ability and intent to settle the face value in cash;
and therefore, we use the treasury stock method for calculating the
dilutive impact of the 2024 Notes. The 2024 Notes will have an
impact on our diluted earnings per share when the average price of
our common stock exceeds the conversion price of $60.62. Our guidance does not include
results from Oclaro or shares issued in connection with the closing
of our acquisition of Oclaro as we are unable to predict the timing
of the closing.
We have not provided reconciliations from GAAP to non-GAAP
measures for our outlook. A large portion of non-GAAP adjustments,
such as derivative liability adjustments, restructuring charges,
stock-based compensation, litigation, acquisition-related costs,
non-cash income tax expense and credits, and other costs and
contingencies unrelated to current and future operations are by
their nature highly volatile and we have low visibility as to the
range that may be incurred in the future. For example, in the
fiscal second quarter of 2018, we had a credit of $207.0 million primarily related to a release of
a U.S. valuation allowance, which was offset by a write-down of
deferred tax assets in the amount of $83.0
million due to the lower corporate tax rate enacted under
the 2017 "Tax Cuts and Jobs Act" reform.
November Investor Conferences
As highlighted on our fiscal first quarter earnings conference
call held on November 1, 2018,
Lumentum regularly attends investor relations events and these
events are listed on our website. During the month of
November Alan Lowe, President and
CEO, and Chris Coldren, Interim CFO,
will present at two investor conferences:
- The UBS Global Technology Conference on Monday November 12th at 12:00 pm Pacific Time in San Francisco; and
- The Needham Networking, Communications & Security
Conference on Tuesday November 13th
at 9:20 am Eastern Time in
New York City.
Both presentations will be available live via audio webcast, as
well as archived replay, on Lumentum's Investor Relations website
at http://investor.lumentum.com under the Events and Presentations
section.
About Lumentum
Lumentum (NASDAQ: LITE) is a market-leading manufacturer of
innovative optical and photonic products enabling optical
networking and commercial laser customers worldwide. Lumentum's
optical components and subsystems are part of virtually every type
of telecom, enterprise, and data center network. Lumentum's
commercial lasers enable advanced manufacturing techniques and
diverse applications including next-generation 3D sensing
capabilities. Lumentum is headquartered in Milpitas, California with R&D,
manufacturing, and sales offices worldwide. For more
information, visit https://www.lumentum.com/en.
Forward-Looking Statements
This press release contains forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933 and
Section 21E of the Securities Exchange Act of 1934. These
statements include strategies and our expectations with regard to
such strategies, our expectations for our markets, any anticipation
or guidance as to future financial performance, including the
general trends in our business and the industries in which we
operate, future net revenue, earnings per share, and operating
margins, and future products and customers and our position in the
market. These forward-looking statements involve risks and
uncertainties that could cause actual results to differ materially
from those projected. Among the factors that could cause actual
results to differ from those contemplated are:
(a) quarter-over-quarter product mix fluctuations which can
materially impact profitability measures due to the broad gross
margin ranges across our portfolio; (b) continued decline of
average selling prices across our businesses; (c) effects of
seasonality; (d) the ability of our suppliers and contract
manufacturers to meet production and delivery requirements for our
forecasted demand; (e) inherent uncertainty related to global
markets, including the imposition of tariffs or other duties, and
the effect of such markets on demand for our products; (f) changes
in customer demand; (g) our ability to attract and retain new
customers, particularly in the 3D sensing market; (h) the risk that
the Oclaro transaction does not close, due to the failure of one or
more conditions to closing or the failure of the businesses
(including personnel) to be integrated successfully after closing;
(i) the risk that synergies and non-GAAP earnings accretion will
not be realized or realized to the extent anticipated; (j)
uncertainty as to the market value of the Lumentum shares to be
issued as consideration in the Oclaro merger; (k) the risk that
required governmental approvals of the Oclaro merger (including
China antitrust approvals) will not be obtained or that such
approvals will be delayed beyond current expectations; (l) the risk
that following the Oclaro transaction, Lumentum's financing or
operating strategies will not be successful; (m) litigation in
respect of Lumentum or Oclaro or the merger; and (n) disruption
from the Oclaro merger making it more difficult to maintain
customer, supplier, key personnel and other strategic
relationships. For more information on these and other risks,
please refer to the "Risk Factors" section included in the
Company's Quarterly Report on Form 10-Q for the fiscal first
quarter ended September 29, 2018, filed with the Securities
and Exchange Commission, in the S-4, as amended, filed by Lumentum
with the Securities and Exchange Commission which was declared
effective May 31, 2018, in connection with the Oclaro transaction
and in the documents which are incorporated by reference therein,
and in the Company's other filings with the Securities and Exchange
Commission, including the Company's Annual Report on Form 10-K for
the fiscal year ended June 30, 2018, filed by Lumentum with the
Securities and Exchange Commission on August 28, 2018. The
forward-looking statements and preliminary financial results
contained in this press release are made as of the date hereof and
the Company assumes no obligation to update such statements, except
as required by applicable law.
No Offer or Solicitation
This communication is for informational purposes only and not
intended to and does not constitute an offer to subscribe for, buy
or sell, the solicitation of an offer to subscribe for, buy or sell
or an invitation to subscribe for, buy or sell any securities or
the solicitation of any vote or approval in any jurisdiction
pursuant to or in connection with the proposed Oclaro transaction
or otherwise, nor shall there be any sale, issuance or transfer of
securities in any jurisdiction in contravention of applicable law.
No offer of securities shall be made except by means of a
prospectus meeting the requirements of Section 10 of the Securities
Act of 1933, as amended, and otherwise in accordance with
applicable law.
Additional Information and Where to Find It
In connection with the proposed transaction between Lumentum
Holdings Inc. ("Lumentum") and Oclaro, Inc. ("Oclaro"), Lumentum
filed a registration statement on Form S-4 with the Securities and
Exchange Commission (the "SEC"), which includes a proxy statement
of Oclaro that also constitutes a prospectus of Lumentum. The
registration statement was declared effective by the SEC on
May 31, 2018, and Oclaro commenced
mailing the definitive joint proxy statement/prospectus to
stockholders of Oclaro on or about June 4,
2018, and the special meeting of the stockholders of Oclaro
was held on July 10, 2018.
LUMENTUM AND OCLARO URGE INVESTORS AND SECURITY HOLDERS TO READ
THE DEFINITIVE PROXY STATEMENT/PROSPECTUS AND OTHER DOCUMENTS FILED
WITH THE SECURITIES AND EXCHANGE COMMISSION CAREFULLY AND IN THEIR
ENTIRETY BECAUSE THEY CONTAIN IMPORTANT INFORMATION ABOUT THE
PROPOSED TRANSACTION.
Investors and security holders may obtain these materials and
other documents filed with the Securities and Exchange Commission
free of charge at the Securities and Exchange Commission's website,
www.sec.gov. Copies of documents filed with the Securities and
Exchange Commission by Lumentum (when they become available) may be
obtained free of charge on Lumentum's website at www.lumentum.com
or by directing a written request to Lumentum Holdings Inc.,
Investor Relations, 400 North McCarthy Boulevard, Milpitas, CA 95035. Copies of documents filed
with the Securities and Exchange Commission by Oclaro (when they
become available) may be obtained free of charge on Oclaro's
website at www.oclaro.com or by directing a written request to
Oclaro, Inc. Investor Relations, 225 Charcot Avenue, San Jose, CA 95131.
Use of Non-GAAP Financial Measures
In this press release, Lumentum provides investors business
outlook for gross margin, operating margin, and net income (loss)
per share on a non-GAAP basis. Lumentum believes this non-GAAP
financial information provides additional insight into the
Company's on-going performance and has therefore chosen to provide
this information to investors for a more consistent basis of
comparison and to help them evaluate the results of the Company's
on-going operations and enable more meaningful period to period
comparisons. Specifically, the Company believes that providing this
information allows investors to better understand the Company's
financial performance and, importantly, to evaluate the efficacy of
the methodology and information used by management to evaluate and
measure such operating performance. However, these measures may be
different from non-GAAP measures used by other companies, limiting
their usefulness for comparison purposes. The non-GAAP financial
measures used in this press release should not be considered in
isolation from measures of financial performance prepared in
accordance with GAAP. Investors are cautioned that there are
material limitations associated with the use of non-GAAP financial
measures as an analytical tool. In particular, many of the
adjustments to our GAAP financial measures reflect the exclusion of
items that are recurring and will be reflected in our financial
results for the foreseeable future. Further, these non-GAAP
financial measures may not be comparable to similarly titled
measurements reported by other companies.
Non-GAAP gross margin, non-GAAP operating margin, non-GAAP net
income, and non-GAAP net income per share, non-GAAP gross profit,
non-GAAP operating income, non-GAAP income (loss) before income
taxes and non-GAAP expenses exclude (i) stock-based compensation,
(ii) acquisition related costs, (iii) other charges comprised
mainly of set-up costs of our Thailand facility, including costs of
transferring product lines to Thailand, as well as inventory write-downs due
to cancelled programs and other costs and contingencies unrelated
to current and future operations, (iv) amortization of acquired
developed technologies, (v) workforce related charges such as
severance, retention bonuses and employee relocation costs related
to formal restructuring plans, (vi) non-cash interest expense,
(vii) unrealized gain (loss) on derivative liability, and (viii)
non-cash income tax provision impacts, for example, a release of a
U.S. valuation allowance, and the write down of deferred tax assets
due to the 2017 Tax Cuts and Jobs Act. The presentation of these
and other similar items in Lumentum's non-GAAP financial results
should not be interpreted as implying that these items are
non-recurring, infrequent or unusual.
Contact Information
Investors: Chris Coldren,
408-404-0606; investor.relations@lumentum.com
Press: Greg Kaufman,
408-546-4593; media@lumentum.com
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SOURCE Lumentum