Delaware | 000-50350 | 77-0419172 | ||
(State or other jurisdiction of incorporation) | (Commission File Number) | (I.R.S. Employer Identification Number) |
o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
o | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
o | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Emerging growth company o |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o |
Exhibit No. | Description of Exhibit | |
NETGEAR, INC. | ||
By: | /s/ Andrew W. Kim | |
Name: | Andrew W. Kim | |
Title: | Senior Vice President, Corporate Development, General Counsel and Secretary | |
Dated: January 2, 2019 | ||
NETGEAR, INC. | ||
Unaudited Pro Forma Consolidated Balance Sheet | ||
As of September 30, 2018 | ||
(In thousands) |
Historical | Arlo Separation | Other Pro Forma Adjustment | Notes | Pro Forma NETGEAR | |||||||||||||
ASSETS | |||||||||||||||||
Current assets: | |||||||||||||||||
Cash and cash equivalents | $ | 393,640 | $ | (148,073 | ) | $ | — | $ | 245,567 | ||||||||
Short-term investments | 136,173 | (39,773 | ) | — | 96,400 | ||||||||||||
Accounts receivable, net | 358,982 | (117,119 | ) | — | 241,863 | ||||||||||||
Inventories | 330,516 | (132,479 | ) | — | 198,037 | ||||||||||||
Prepaid expenses and other current assets | 39,011 | (9,529 | ) | (175 | ) | (a) | 29,307 | ||||||||||
Total current assets | 1,258,322 | (446,973 | ) | (175 | ) | 811,174 | |||||||||||
Property and equipment, net | 56,647 | (39,610 | ) | — | 17,037 | ||||||||||||
Intangibles, net | 22,341 | (3,204 | ) | — | 19,137 | ||||||||||||
Goodwill | 101,965 | (15,638 | ) | (5,511 | ) | (b) | 80,816 | ||||||||||
Other non-current assets | 94,047 | (10,198 | ) | (15,277 | ) | (c) | 68,572 | ||||||||||
Total assets | $ | 1,533,322 | $ | (515,623 | ) | $ | (20,963 | ) | $ | 996,736 | |||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||||||||||||
Current liabilities: | |||||||||||||||||
Accounts payable | $ | 168,155 | $ | (49,947 | ) | $ | — | $ | 118,208 | ||||||||
Accrued employee compensation | 31,168 | (7,969 | ) | (200 | ) | (d) | 22,999 | ||||||||||
Other accrued liabilities | 282,410 | (96,550 | ) | (7,334 | ) | (e) | 178,526 | ||||||||||
Deferred revenue | 35,485 | (26,514 | ) | — | 8,971 | ||||||||||||
Income taxes payable | 6,853 | (199 | ) | 199 | (c) | 6,853 | |||||||||||
Total current liabilities | 524,071 | (181,179 | ) | (7,335 | ) | 335,557 | |||||||||||
Non-current income taxes payable | 21,273 | (22 | ) | 22 | (c) | 21,273 | |||||||||||
Other non-current liabilities | 53,499 | (41,097 | ) | — | 12,402 | ||||||||||||
Total liabilities | 598,843 | (222,298 | ) | (7,313 | ) | 369,232 | |||||||||||
Commitments and contingencies | |||||||||||||||||
Stockholders’ equity: | |||||||||||||||||
Common stock | 32 | — | — | 32 | |||||||||||||
Additional paid-in capital | 785,694 | — | — | 785,694 | |||||||||||||
Accumulated other comprehensive loss | (36 | ) | (14 | ) | — | (50 | ) | ||||||||||
Retained earnings | 124,488 | (293,311 | ) | 10,651 | (f) (g) | (158,172 | ) | ||||||||||
Total NETGEAR stockholders’ equity | 910,178 | (293,325 | ) | 10,651 | 627,504 | ||||||||||||
Non-controlling interest | 24,301 | $ | — | $ | (24,301 | ) | (f) | $ | — | ||||||||
Total stockholders' equity | 934,479 | $ | (293,325 | ) | $ | (13,650 | ) | $ | 627,504 | ||||||||
Total liabilities and stockholders’ equity | $ | 1,533,322 | $ | (515,623 | ) | $ | (20,963 | ) | $ | 996,736 |
NETGEAR, INC. |
Unaudited Pro Forma Consolidated Statements Of Operations |
Nine Months Ended September 30, 2018 |
(In thousands, except per share data) |
Historical | Arlo Separation | Pro Forma NETGEAR | |||||||||
Net revenue | $ | 1,112,379 | $ | (342,491 | ) | $ | 769,888 | ||||
Cost of revenue | 774,510 | (255,666 | ) | 518,844 | |||||||
Gross profit | 337,869 | (86,825 | ) | 251,044 | |||||||
Operating expenses: | |||||||||||
Research and development | 95,571 | (32,298 | ) | 63,273 | |||||||
Sales and marketing | 139,646 | (25,328 | ) | 114,318 | |||||||
General and administrative | 60,354 | (9,951 | ) | 50,403 | |||||||
Separation expense | 25,822 | (25,443 | ) | 379 | |||||||
Restructuring and other charges | 1,368 | — | 1,368 | ||||||||
Litigation reserves, net | 5 | — | 5 | ||||||||
Total operating expenses | 322,766 | (93,020 | ) | 229,746 | |||||||
Income from operations | 15,103 | 6,195 | 21,298 | ||||||||
Interest income (expense), net | 3,310 | (504 | ) | 2,806 | |||||||
Other income (expense), net | 638 | (213 | ) | 425 | |||||||
Income before income taxes | 19,051 | 5,478 | 24,529 | ||||||||
Provision for income taxes | 9,541 | (2,873 | ) | 6,668 | |||||||
Net income | 9,510 | 8,351 | 17,861 | ||||||||
Net loss attributable to non-controlling interest | (799 | ) | 799 | (f) | — | ||||||
Net income attributable to NETGEAR, Inc. | $ | 10,309 | $ | 7,552 | $ | 17,861 | |||||
Net income per share: | |||||||||||
Basic | $ | 0.33 | $ | 0.56 | |||||||
Diluted | $ | 0.31 | $ | 0.54 | |||||||
Weighted average shares used to compute net income per share: | |||||||||||
Basic | 31,634 | 31,634 | |||||||||
Diluted | 32,826 | 32,826 |
NETGEAR, INC. |
Unaudited Pro Forma Consolidated Statements Of Operations |
Year Ended December 31, 2017 |
(In thousands, except per share data) |
Historical | Arlo Separation | Pro Forma NETGEAR | ||||||||||
Net revenue | $ | 1,406,920 | $ | (367,751 | ) | $ | 1,039,169 | |||||
Cost of revenue | 1,010,878 | (279,425 | ) | 731,453 | ||||||||
Gross profit | 396,042 | (88,326 | ) | 307,716 | ||||||||
Operating expenses: | ||||||||||||
Research and development | 94,603 | (22,710 | ) | 71,893 | ||||||||
Sales and marketing | 158,168 | (19,489 | ) | 138,679 | ||||||||
General and administrative | 55,037 | (691 | ) | 54,346 | ||||||||
Separation expense | 1,384 | (1,384 | ) | — | ||||||||
Restructuring and other charges | 97 | — | 97 | |||||||||
Litigation reserves, net | 176 | (28 | ) | 148 | ||||||||
Total operating expenses | 309,465 | (44,302 | ) | 265,163 | ||||||||
Income from operations | 86,577 | (44,024 | ) | 42,553 | ||||||||
Interest income | 2,113 | — | 2,113 | |||||||||
Other income (expense), net | 2,024 | (466 | ) | 1,558 | ||||||||
Income before income taxes | 90,714 | (44,490 | ) | 46,224 | ||||||||
Provision for income taxes | 71,278 | (13,921 | ) | 57,357 | ||||||||
Net income (loss) | $ | 19,436 | $ | (30,569 | ) | $ | (11,133 | ) | ||||
Net income per share: | ||||||||||||
Basic | $ | 0.61 | $ | (0.35 | ) | |||||||
Diluted | $ | 0.59 | $ | (0.35 | ) | |||||||
Weighted average shares used to compute net income per share: | ||||||||||||
Basic | 32,097 | 32,097 | ||||||||||
Diluted | 33,044 | 32,097 | (h) |
NETGEAR, INC. |
Unaudited Pro Forma Consolidated Statements Of Operations |
Year Ended December 31, 2016 |
(In thousands, except per share data) |
Historical | Arlo Separation | Pro Forma NETGEAR | |||||||||
Net revenue | $ | 1,328,298 | $ | (184,853 | ) | $ | 1,143,445 | ||||
Cost of revenue | 916,113 | (146,570 | ) | 769,543 | |||||||
Gross profit | 412,185 | (38,283 | ) | 373,902 | |||||||
Operating expenses: | |||||||||||
Research and development | 89,367 | (18,463 | ) | 70,904 | |||||||
Sales and marketing | 150,355 | (10,764 | ) | 139,591 | |||||||
General and administrative | 54,482 | (486 | ) | 53,996 | |||||||
Restructuring and other charges | 3,881 | (40 | ) | 3,841 | |||||||
Litigation reserves, net | 73 | — | 73 | ||||||||
Total operating expenses | 298,158 | (29,753 | ) | 268,405 | |||||||
Income from operations | 114,027 | (8,530 | ) | 105,497 | |||||||
Interest income | 1,163 | — | 1,163 | ||||||||
Other income (expense), net | (121 | ) | (44 | ) | (165 | ) | |||||
Income before income taxes | 115,069 | (8,574 | ) | 106,495 | |||||||
Provision for income taxes | 39,218 | (3,035 | ) | 36,183 | |||||||
Net income | $ | 75,851 | $ | (5,539 | ) | $ | 70,312 | ||||
Net income per share: | |||||||||||
Basic | $ | 2.32 | $ | 2.15 | |||||||
Diluted | $ | 2.25 | $ | 2.08 | |||||||
Weighted average shares used to compute net income per share: | |||||||||||
Basic | 32,758 | 32,758 | |||||||||
Diluted | 33,728 | 33,728 |
NETGEAR, INC. |
Unaudited Pro Forma Consolidated Statements Of Operations |
Year Ended December 31, 2015 |
(In thousands, except per share data) |
Historical | Arlo Separation | Pro Forma NETGEAR | |||||||||
Net revenue | $ | 1,300,695 | $ | (88,882 | ) | $ | 1,211,813 | ||||
Cost of revenue | 933,016 | (72,579 | ) | 860,437 | |||||||
Gross profit | 367,679 | (16,303 | ) | 351,376 | |||||||
Operating expenses: | |||||||||||
Research and development | 86,499 | (9,143 | ) | 77,356 | |||||||
Sales and marketing | 146,794 | (4,781 | ) | 142,013 | |||||||
General and administrative | 45,313 | (76 | ) | 45,237 | |||||||
Restructuring and other charges | 6,398 | (39 | ) | 6,359 | |||||||
Litigation reserves, net | (2,682 | ) | — | (2,682 | ) | ||||||
Total operating expenses | 282,322 | (14,039 | ) | 268,283 | |||||||
Income from operations | 85,357 | (2,264 | ) | 83,093 | |||||||
Interest income | 295 | — | 295 | ||||||||
Other income (expense), net | (88 | ) | 41 | (47 | ) | ||||||
Income before income taxes | 85,564 | (2,223 | ) | 83,341 | |||||||
Provision for income taxes | 36,980 | (1,034 | ) | 35,946 | |||||||
Net income | $ | 48,584 | $ | (1,189 | ) | $ | 47,395 | ||||
Net income per share: | |||||||||||
Basic | $ | 1.47 | $ | 1.43 | |||||||
Diluted | $ | 1.44 | $ | 1.40 | |||||||
Weighted average shares used to compute net income per share: | |||||||||||
Basic | 33,161 | 33,161 | |||||||||
Diluted | 33,788 | 33,788 |