EX-99.1 2 q321ex991earningsrelease.htm EX-99.1 Document

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Poly Announces Third Quarter Fiscal Year 2021 Financial Results

Delivers Strong Revenue and Profitability Driven by Record Professional Headset and Video Revenues as Long-Term Trends Toward Remote Work and Video Collaboration Accelerate

New Products, Partnerships, and Distribution Strategies Target Post-Pandemic Environment and Evolving Purchasing Patterns

Improved Operational Execution Drives Solid Operating Cash Flow

SANTA CRUZ, Calif., - February 4, 2021 - Poly (NYSE: PLT), a global outfitter of professional-grade audio and video technology, today announced third quarter results for the period ended December 26, 2020.

Highlights for the third quarter include:

•Poly posted record Professional Headset and Video revenues, with unit shipments more than doubling in each category year over year, reflecting the massive shift in the way work is done, where work is done, and the importance of reliable, high-fidelity connectivity.

•The Company announced the Poly Studio P Series, a new family of sophisticated prosumer video solutions, addressing the growing need for tools that allow professionals to work from anywhere, connect easily using any platform, and enjoy enterprise-grade service and support.

•The Company also announced Poly Lens Desktop App and Poly+. Poly Lens provides insights and management capabilities for voice, video, and headsets under a single pane of glass, while Poly+ is a personal device service providing 24/7 tech-support, overnight replacement, and advanced troubleshooting tools.

•Microban and Poly announced an exclusive relationship in which Microban’s antimicrobial technology will be incorporated into Poly high-touch collaboration devices.

•Ongoing operational and turnaround efforts continue to show momentum and bottom-line results. Key additions have been made to the executive leadership team, including the appointments of Grant Hoffman as EVP Chief Supply Chain Officer, Gloria Loredo as Chief Transformation Officer, Lisa Bodensteiner as EVP Chief Legal and Compliance Officer and Corporate Secretary, and John Goodwin as SVP, Public Affairs.

•The Company generated $31M in operating cash flow, retired $12M of debt, and ended the quarter with $245M in cash and short-term investments, setting the stage for continued de-levering.

"We believe the end markets for professional-grade communications gear have permanently expanded, because work is no longer a place, it’s what you do,” said Dave Shull, Poly President and Chief Executive Officer. “In a world less dependent on being in the same room, but still demanding live interaction, the importance of pro-grade, easy-to-use technology that offers a superior remote experience is paramount. Poly is a company built on connecting people. And customers are responding because we offer superior products and services.”

“We continue to operate with a sense of urgency as it relates to improving our operations,” said Chuck Boynton, Executive Vice President and Chief Financial Officer. “We’ve taken concrete steps to control costs, make disciplined investments in new products, and balance supply chain exposures. And we’re seeing that tactical execution reflected in this quarter’s results. In particular, the strong profitability and cash flow we posted today allows us to accelerate de-levering, as debt reduction remains a top priority.”

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($ Millions, except percent and per-share data)1
Q3 FY21Q3 FY20YTD FY21YTD FY20
GAAP Revenue$485 $384 $1,251 $1,294 
GAAP Gross Margin46.8 %37.4 %45.0 %43.5 %
GAAP Operating Income / (Loss)$29 ($77)($22)($111)
GAAP Diluted EPS$0.48 ($1.97)($1.67)($3.78)
Cash Flow from Operations$31 ($17)$71 $16 
Non-GAAP Revenue$488 $392 $1,264 $1,322 
Non-GAAP Gross Margin50.7 %49.4 %49.9 %52.7 %
Non-GAAP Operating Income$90 $31 $186 $198 
Non-GAAP Diluted EPS$1.47 $0.30 $2.75 $2.85 
Adjusted EBITDA$100 $43 $216 $234 

1 For further information on supplemental non-GAAP metrics refer to the Use of Non-GAAP Financial Information and Unaudited Reconciliations of GAAP Measures to Non-GAAP Measures sections below.

Results Compared to October 29, 2020 Guidance

Q3 FY21 Results
Q3 FY21 Guidance Range2
GAAP Net Revenue$485M$417M - $447M
Non-GAAP Net Revenue$488M$420M - $450M
Adjusted EBITDA$100M$70M - $80M
Non-GAAP Diluted EPS$1.47$0.85 - $1.05

2The non-GAAP revenue guidance range shown here excludes the $3.3 million impact of purchase accounting related to recording deferred revenue at fair value at the time of the acquisition.


Business Outlook

The following statements are based on the Company's current expectations, and many of these statements are forward-looking. Actual results are subject to a variety of risks and uncertainties and may differ materially from the Company's expectations. Please refer to the Forward Looking Statements Safe Harbor section of this press release below.

The following represents the expected range of financial results for the fiscal fourth quarter of 2021 (all amounts assume currency rates remain stable):

Q4 FY21 Guidance
GAAP Net Revenue$438M - $468M
Non-GAAP Revenue$440M - $470M
Adjusted EBITDA1
$70M - $80M
Non-GAAP Diluted EPS1,2
$0.80 - $1.00

1 Q4 Adjusted EBITDA and non-GAAP diluted EPS guidance excludes estimated intangibles amortization expense of $30.4 million. With respect to adjusted EBITDA and diluted EPS guidance, the Company has determined that it is unable to provide quantitative reconciliations of these forward-looking non-GAAP measures to the most directly comparable forward-looking GAAP measures with a reasonable degree of confidence in their accuracy without unreasonable effort, as items including stock based compensation, litigation gains and losses, and impacts from discrete tax adjustments and tax laws are inherently uncertain and depend on various factors, many of which are beyond the Company's control.

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2 Non-GAAP diluted EPS guidance assumes approximately 43 million diluted average weighted shares and a non-GAAP effective tax rate of 12% to 14%. There are several discreet tax items, which if resolved in the quarter, may favorably impact the GAAP and non-GAAP tax rates. The timing and magnitude of these items is difficult to predict. As a result, the Company has provided a non-GAAP effective tax rate range exclusive of these items.


Conference Call and Earnings Presentation

Poly is providing an earnings presentation in combination with this press release. The presentation is offered to provide shareholders and analysts with additional detail for analyzing results. The presentation will be available in the Investor Relations section of our corporate website at investor.poly.com along with this press release. A reconciliation of our GAAP to non-GAAP results is provided at the end of this press release.

We have scheduled a webcast to discuss third quarter fiscal year 2021 financial results. The webcast will take place today, February 4, 2021, at 2:00 PM (Pacific Time). All interested investors and potential investors in Poly stock are invited to join. To listen to the webcast, please access the webcast link from our Investor Relations website at investor.poly.com.

A replay of the webcast will be available shortly after its conclusion and can be accessed from our Investor Relations website at investor.poly.com.

Forward Looking Statements Safe Harbor

This press release contains 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, including statements relating to our intentions, beliefs, projections, outlook, analyses or current expectations that are subject to many risks and uncertainties. Such forward-looking statements and the associated risks and uncertainties include, but are not limited to: (i) our beliefs with respect to the length and severity of the COVID-19 (coronavirus) outbreak, and its impact across our businesses, our operations and global supply chain, including (a) our expectations the virus has caused and will continue to cause an increase in customer and partner demand for our product lines, including increased demand in collaboration endpoints, and our ability to design new product offerings to meet the change in demand due to a global hybrid work environment; (b) risks related to increased freight and other costs associated with expediting shipment and delivery of high-demand products to key markets in order to meet customer demand, (c) our inability to source component parts from key suppliers in sufficient quantities necessary to meet the high demand for certain product lines, including our Enterprise Headsets and continued uncertainty and potential impact on future quarters if sourcing constraints continue and/or price volatility occurs, which could continue to negatively affect our profitability and/or market share; (d) expectations related to our voice product lines, as well as our services attachment rate for such products, which have been, and may continue to be, negatively impacted as companies have delayed returning their workforces to offices in many countries due to the continued impact of COVID-19; (e) expectations related to our ability to fulfill the backlog generated by supply constraints, to timely supply the number of products to fulfill current and future customer demand, including expectations that our manufacturing facility in Tijuana, Mexico will continue production at the capacity necessary to meet such demand; (f) the impact of the virus on our distribution partners, resellers, end-user customers and our production facilities, including our ability to obtain alternative sources of supply if our production facility or other suppliers are impacted by future shutdowns; (g) the impact if global or regional economic conditions deteriorate further, on our customers and/or partners, including increased demand for pricing accommodations, delayed payments, delayed deployment plans, insolvency or other issues which may increase credit losses; (h) risks related to restrictions or delays in global return to worksites as a result of COVID-19, which continues to impact our employees and our customers worldwide, which has negatively impacted our voice product lines for the quarter, and restricted customer engagement; and (i) the complexity of the forecast analysis and the design and operation of internal controls; and (ii) our belief that we can manufacture or supply products in a timely manner to satisfy perishable demand; (iii) expectations related to our customers’ purchasing decisions and our ability to pivot quickly enough and/or match product production to demand, particularly given long lead times and the difficulty of forecasting unit volumes and acquiring the component parts and materials to meet demand without having excess inventory or incurring cancellation charges; (iv) risks associated with significant and/or abrupt changes in product demand which increases the complexity of management’s evaluation of potential excess or obsolete inventory; (v) risks associated with the bankruptcy or financial weakness of distributors or key customers, or the bankruptcy of or reduction in capacity of our key suppliers; (vi) risks associated with the potential interruption in the supply of sole-sourced critical components, our ability to move to a dual-source model, and the continuity of component supply at costs consistent with our plans, which has negatively impacted us in the quarter and may continue to impact our ability to timely supply product to meet our customer demand; (vii) expectations related to our services segment revenues, particularly as we introduce new generation, less complex, product solutions, or as companies shift from on premises to work from home options for their workforce, which may result in decreased demand for our professional, installation and/or managed service offerings; (viii) expectations that our current cash on hand, additional cash generated from operations, together with sources of cash through our credit facility, either alone or in combination with our election to suspend our dividend payments, will meet our liquidity needs during and

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following the unknown duration and impact of the COVID-19 pandemic; (ix) expectations relating to our ability to generate sufficient cash flow from operations to meet our debt covenants and timely repay all principal and interest amounts drawn under our credit facility as they become due; (x) risks associated with our channel partners’ sales reporting, product inventories and product sell through since we sell a significant amount of products to channel partners who maintain their own inventory of our products; (xi) our efforts to execute to drive sales and sustainable profitable revenue growth, to improve our profitability and cash flow, and accelerate debt reduction and de-levering; (xii) our expectations for new products launches, the timing of their releases and their expected impact on future growth and on our existing products; (xiii) our belief that our Partner Program and/or our product management and personal device services, including Poly Lens and/or Poly+ will drive growth and profitability for both us and our partners through the sale of our product, services and solutions; (xiv) risks associated with forecasting sales and procurement demands, which are inherently difficult, particularly with continuing uncertainty in regional and global economic conditions; (xv) uncertainties attributable to currency fluctuations, including fluctuations in foreign exchange rates and/or new or greater tariffs on our products; (xvi) our expectations regarding our ability to control costs, streamline operations and successfully implement our various cost-reduction activities and realize anticipated cost savings under such cost-reduction initiatives; (xvii) expectations relating to our quarterly and annual earnings guidance, particularly as economic uncertainty, including, without limitation, uncertainty related to the continued impact of COVID-19, the macro-economic and political climate and other external factors, puts further pressure on management judgments used to develop forward looking financial guidance and other prospective financial information; (xviii) expectations related to GAAP and non-GAAP financial results for the fourth quarter and full Fiscal Year 2021, including net revenues, adjusted EBITDA, tax rates, intangibles amortization, diluted weighted average shares outstanding and diluted EPS; (xix) our expectations of the impact of the acquisition of Polycom as it relates to our strategic vision and additional market and strategic partnership opportunities for our combined hardware, software and services offerings; (xx) our beliefs regarding the UC&C market, market dynamics and opportunities, and customer and partner behavior as well as our position in the market, including risks associated with the potential failure of our UC&C solutions to be adopted with the breadth and speed we anticipate; (xxi) our belief that the increased adoption of certain technologies and our open architecture approach has and will continue to increase demand for our solutions; (xxii) expectations related to the micro and macro-economic conditions in our domestic and international markets and their impact on our future business; (xxiii) our forecast and estimates with respect to tax matters, including expectations with respect to utilizing our deferred tax assets; (xxiv) our expectations related to building strategic alliances and key partnerships with providers of collaboration tools and platforms to drive revenue growth and market share; and (xxv) our expectations regarding pending and potential future litigation, in addition to other matters discussed in this press release that are not purely historical data. Such forward-looking statements are based on current expectations and assumptions and are subject to risks and uncertainties that may cause actual results to differ materially from the forward-looking statements.

We do not assume any obligation to update or revise any such forward-looking statements, whether as the result of new developments or otherwise.

For more information concerning these and other possible risks, please refer to our Annual Report on Form 10-K filed with the Securities and Exchange Commission on June 8, 2020 and other filings with the Securities and Exchange Commission, as well as recent press releases.


About Poly

Poly (NYSE: PLT) creates premium audio and video products so you can have your best meeting -- anywhere, anytime, every time. Our headsets, video and audio-conferencing products, desk phones, analytics software and services are beautifully designed and engineered to connect people with incredible clarity. They’re pro-grade, easy to use and work seamlessly with all the best video and audio conferencing services. With Poly (Plantronics, Inc. – formerly Plantronics and Polycom), you’ll do more than just show up, you’ll stand out. For more information visit www.Poly.com.

Poly and the propeller design are trademarks of Plantronics, Inc. All other trademarks are the property of their respective owners.

INVESTOR CONTACT:
Mike Iburg
Vice President, Investor Relations
(831) 458-7533		MEDIA CONTACT:
Edie Kissko
Vice President, Corporate Communications
(213) 369-3719

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PLANTRONICS, INC.
SUMMARY CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
($ in thousands, except per share data)
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
 Three Months EndedNine Months Ended
 December 26,December 28,December 26,December 28,
 2020201920202019
Net revenues:
Net product revenues$420,711 $316,633 $1,059,846 $1,094,515 
Net services revenues63,974 67,838 191,529 199,432 
Total net revenues484,685 384,471 1,251,375 1,293,947 
Cost of revenues:
Cost of product revenues236,842 220,469 622,718 658,408 
Cost of service revenues21,186 20,156 64,921 72,976 
Total cost of revenues258,028 240,625 687,639 731,384 
Gross profit226,657 143,846 563,736 562,563 
Gross profit %46.8 %37.4 %45.0 %43.5 %
Operating expenses:
Research, development, and engineering54,150 53,769 156,327 170,708 
Selling, general, and administrative129,641 144,978 361,892 457,004 
(Gain) loss, net from litigation settlements— — 17,561 (1,162)
Restructuring and other related charges13,977 21,724 49,477 47,096 
Total operating expenses197,768 220,471 585,257 673,646 
Operating income (loss)28,889 (76,625)(21,521)(111,083)
Operating income (loss) %6.0 %(19.9)%(1.7)%(8.6)%
Interest expense(18,417)(22,533)(58,182)(70,262)
Other non-operating income, net2,596 967 4,188 675 
Income (loss) before income taxes13,068 (98,191)(75,515)(180,670)
Income tax benefit(7,045)(19,708)(7,208)(31,406)
Net income (loss)$20,113 $(78,483)$(68,307)$(149,264)
% of net revenues4.1 %(20.4)%(5.5)%(11.5)%
Earnings (loss) per common share:  
Basic$0.49 $(1.97)$(1.67)$(3.78)
Diluted$0.48 $(1.97)$(1.67)$(3.78)
Shares used in computing earnings (loss) per common share:  
Basic41,252 39,784 40,894 39,535 
Diluted42,184 39,784 40,894 39,535 
Effective tax rate(53.9)%20.1 %9.6 %17.4 %


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PLANTRONICS, INC.
SUMMARY CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
($ in thousands)
UNAUDITED CONSOLIDATED BALANCE SHEETS
 December 26,March 28,
 20202020
ASSETS 
Cash and cash equivalents$230,065 $213,879 
Short-term investments15,280 11,841 
Total cash, cash equivalents, and short-term investments245,345 225,720 
Accounts receivable, net315,477 246,835 
Inventory, net190,468 164,527 
Other current assets62,996 47,946 
Total current assets814,286 685,028 
Property, plant, and equipment, net143,489 165,858 
Goodwill796,216 796,216 
Purchased intangibles, net372,047 466,915 
Deferred tax and other assets152,684 143,157 
Total assets$2,278,722 $2,257,174 
LIABILITIES AND STOCKHOLDERS' DEFICIT  
Accounts payable$165,958 $102,159 
Accrued liabilities401,283 373,666 
Total current liabilities567,241 475,825 
Long-term debt, net of issuance costs1,576,998 1,621,694 
Long-term income taxes payable90,980 98,319 
Other long-term liabilities156,524 144,152 
Total liabilities2,391,743 2,339,990 
Stockholders' deficit(113,021)(82,816)
Total liabilities and stockholders' deficit$2,278,722 $2,257,174 



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PLANTRONICS, INC.
SUMMARY CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
($ in thousands, except per share data)
UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS
 Three Months EndedNine Months Ended
 December 26,December 28,December 26,December 28,
 2020201920202019
Cash flows from operating activities
Net income (loss)$20,113 $(78,483)$(68,307)$(149,264)
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization40,510 57,556 124,881 172,630 
Amortization of debt issuance cost1,302 1,340 3,962 4,062 
Stock-based compensation11,486 13,902 31,104 41,499 
Deferred income taxes(11,317)(17,369)(15,373)(62,436)
Provision for excess and obsolete inventories3,609 13,394 12,767 19,076 
Restructuring charges13,977 21,725 49,477 47,096 
Cash payments for restructuring charges(4,335)(6,936)(28,794)(29,885)
Other operating activities(2,838)(5,694)(6,000)3,201 
Changes in assets and liabilities:
Accounts receivable, net(79,066)30,856 (71,439)34,634 
Inventory, net(12,391)6,264 (39,941)(49,320)
Current and other assets(9,301)14,790 (15,246)24,142 
Accounts payable29,562 (45,600)62,454 (10,690)
Accrued liabilities24,504 (15,212)47,529 (46,906)
Income taxes5,077 (7,744)(15,925)18,516 
Cash provided by (used in) operating activities$30,892 $(17,211)$71,149 $16,355 
Cash flows from investing activities
Proceeds from sale of investments667 7 667 177 
Purchase of investments(156)(166)(394)(972)
Capital expenditures(5,872)(7,724)(16,753)(16,984)
Proceeds from sale of property and equipment— 2,142 1,900 2,142 
Cash used for investing activities$(5,361)$(7,883)$(14,580)$(15,637)
Cash flows from financing activities
Employees' tax withheld and paid for restricted stock and restricted stock units(144)(388)(3,193)(9,669)
Proceeds from issuances under stock-based compensation plans— 1 5,731 6,617 
Proceeds from revolving line of credit— — 50,000 — 
Repayments of revolving line of credit— — (50,000)— 
Repayments of long-term debt(11,417)— (46,980)(25,000)
Payment of cash dividends— (5,988)— (17,910)
Cash used for financing activities$(11,561)$(6,375)$(44,442)$(45,962)
Effect of exchange rate changes on cash and cash equivalents2,194 1,848 4,059 (444)
Net increase (decrease) in cash and cash equivalents16,164 (29,621)16,186 (45,688)
Cash and cash equivalents at beginning of period213,901 186,442 213,879 202,509 
Cash and cash equivalents at end of period$230,065 $156,821 $230,065 $156,821 





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Use of Non-GAAP Financial Information

To supplement our condensed consolidated financial statements presented on a GAAP basis, we use non-GAAP measures of operating results, including non-GAAP net revenues, non-GAAP gross profit, non-GAAP operating expenses, non-GAAP operating income, non-GAAP net income, adjusted EBITDA, and non-GAAP diluted EPS. These non-GAAP measures are adjusted from the most directly comparable GAAP measures to exclude certain non-cash transactions and activities that are not reflective of our ongoing core operations as further described below. We believe the use of each of these non-GAAP measures provides meaningful supplemental information in assessing our operating performance and liquidity across reporting periods on a consistent basis and are used by management in evaluating financial performance and in strategic planning. These non-GAAP measures may differ from those used by other companies and are not intended to be considered in isolation of, or as a substitute for, financial results prepared in accordance with GAAP.

Non-GAAP Adjustments

•Purchase accounting amortization: Represents the amortization of purchased intangible assets recorded in connection with the acquisition of Polycom on July 2, 2018.

•Deferred revenue purchase accounting: Represents the impact of fair value purchase accounting adjustments related to deferred revenue recorded in connection with the acquisition of Polycom on July 2, 2018. The Company's deferred revenue primarily relates to Service revenue associated with non-cancelable maintenance support on hardware devices which are typically billed in advance and recognized ratably over the contract term as those services are delivered. This adjustment represents the amount of additional revenue that would have been recognized during the period absent the write-down to fair value required under purchase accounting guidelines.

•Consumer optimization: Represents charges related to inventory reserves and supplier liabilities for excess and obsolete inventory incurred in connection with the Company's strategic action to optimize its Consumer product portfolio.

•Stock compensation expense: Represents the non-cash expense associated with the Company's issuance of common stock and share-based awards to employees and non-employee directors.

•Restructuring and other related charges: The Company incurs costs associated with restructuring plans and reorganization actions aimed at improving the Company’s overall cost structure and realigning resources consistent with its global strategy. These costs are not reflective of ongoing operations and are primarily associated with reductions in the Company’s workforce, facility related charges due to the closure or consolidation of leased offices, and other related costs including legal and advisory services.

•Integration and rebranding costs: Represents charges incurred in connection with the acquisition and integration of Polycom such as system implementations, legal and accounting fees.

•Deferred compensation mark-to-market: Represents gains and losses driven by the remeasurement of assets and liabilities associated with the Company’s deferred compensation plans. Gains and losses on plan liabilities are recognized within operating expenses, while the offsetting gains and losses on plan assets are recognized within other income (loss).

•Gain (loss) on litigation settlements: The Company may be involved in various litigation, claims and proceedings that result in payments or recoveries from such proceedings. The related gains and losses incurred are excluded as they are not reflective of ongoing operations.

•Other adjustments: Immaterial charges and benefits including certain executive transition costs.


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•Income tax effects: Represents the tax effects of the above non-GAAP adjustments and other adjustments depending on the nature of the underlying items. The exclusion of the above-mentioned items eliminates the effect of certain non-recurring and unusual tax items that do not necessarily reflect the Company’s long-term operations.

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PLANTRONICS, INC.
UNAUDITED RECONCILIATIONS OF GAAP MEASURES TO NON-GAAP MEASURES
($ in thousands, except per share data)
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS DATA
 
 Three Months EndedNine Months Ended
December 26,December 28,December 26,December 28,
2020201920202019
GAAP Net revenues$484,685 $384,471 $1,251,375 $1,293,947 
Deferred revenue purchase accounting3,289 7,131 12,608 27,815 
Non-GAAP Net revenues$487,974 $391,602 $1,263,983 $1,321,762 
GAAP Gross profit$226,657 $143,846 $563,736 $562,563 
Purchase accounting amortization16,459 30,819 51,873 91,535 
Deferred revenue purchase accounting3,289 7,131 12,608 27,815 
Consumer optimization— 10,415 — 10,415 
Stock-based compensation799 1,019 2,374 2,994 
Integration and rebranding costs— 100 — 1,169 
Non-GAAP Gross profit$247,204 $193,330 $630,591 $696,491 
Non-GAAP Gross profit %50.7 %49.4 %49.9 %52.7 %
GAAP Research, development, and engineering$54,150 $53,769 $156,327 $170,708 
Stock-based compensation(3,441)(4,584)(10,740)(12,516)
Integration and rebranding costs— (538)— (2,439)
Other adjustments— — — (542)
Non-GAAP Research, development, and engineering$50,709 $48,647 $145,587 $155,211 
GAAP Selling, general, and administrative$129,641 $144,978 $361,892 $457,004 
Purchase accounting amortization(14,195)(15,278)(42,585)(45,834)
Stock-based compensation(7,246)(8,299)(17,995)(25,989)
Deferred compensation mark to market (1,632)— (2,346)— 
Integration and rebranding costs— (8,039)— (42,288)
Other adjustments— (4)— 
Non-GAAP Selling, general, and administrative$106,568 $113,362 $298,962 $342,893 


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PLANTRONICS, INC.
UNAUDITED RECONCILIATIONS OF GAAP MEASURES TO NON-GAAP MEASURES
($ in thousands, except per share data)
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS DATA (CONTINUED)
 
 Three Months EndedNine Months Ended
 December 26,December 28,December 26,December 28,
2020201920202019
GAAP Operating expenses$197,768 $220,471 $585,257 $673,646 
Purchase accounting amortization(14,195)(15,278)(42,585)(45,834)
Stock-based compensation(10,687)(12,883)(28,735)(38,505)
Restructuring and other related charges(13,977)(21,724)(49,477)(47,096)
Deferred compensation mark to market(1,632)— (2,346)— 
Integration and rebranding costs— (8,577)— (44,727)
Loss, net from litigation settlements— — (17,561)— 
Other adjustments— — (4)620 
Non-GAAP Operating expenses$157,277 $162,009 $444,549 $498,104 
GAAP Operating income (loss)$28,889 $(76,625)$(21,521)$(111,083)
Purchase accounting amortization30,654 46,097 94,458 137,369 
Stock-based compensation11,486 13,902 31,109 41,499 
Restructuring and other related charges13,977 21,724 49,477 47,096 
Deferred revenue purchase accounting3,289 7,131 12,608 27,815 
Deferred compensation mark to market1,632 — 2,346 — 
Consumer optimization— 10,415 — 10,415 
Loss, net from litigation settlements— — 17,561 — 
Integration and rebranding costs— 8,677 — 45,896 
Other adjustments— — 4 (620)
Non-GAAP Operating income$89,927 $31,321 $186,042 $198,387 


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PLANTRONICS, INC.
UNAUDITED RECONCILIATIONS OF GAAP MEASURES TO NON-GAAP MEASURES
($ in thousands, except per share data)
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS DATA (CONTINUED)
 
 Three Months EndedNine Months Ended
 December 26,December 28,December 26,December 28,
2020201920202019
GAAP Net income (loss)$20,113 $(78,483)$(68,307)$(149,264)
Purchase accounting amortization30,654 46,097 94,458 137,369 
Stock-based compensation11,486 13,902 31,109 41,499 
Restructuring and other related charges13,977 21,724 49,477 47,096 
Deferred revenue purchase accounting3,289 7,131 12,608 27,815 
Consumer optimization— 10,415 — 10,415 
Deferred compensation mark to market49 — 84 — 
Loss, net from litigation settlements— — 17,561 — 
Integration and rebranding costs— 8,677 — 45,896 
Other adjustments— — 8 (620)
Income tax effect of above items(2,175)(17,021)(15,746)(45,015)
Income tax effect of unusual tax items(15,291)1(482)(7,422)1(2,001)
Non-GAAP Net income$62,102 $11,960 $113,830 $113,190 
GAAP Diluted earnings per common share $0.48 $(1.97)$(1.67)$(3.78)
Purchase accounting amortization0.73 1.16 2.28 3.46 
Stock-based compensation0.270.350.751.04
Restructuring and other related charges0.330.54 1.20 1.19 
Deferred revenue purchase accounting0.080.180.300.70 
Consumer optimization— 0.26 — 0.26 
Loss, net from litigation settlements— — 0.42 — 
Integration and rebranding costs— 0.22 — 1.15 
Deferred compensation mark to market— — 0.01 — 
Other adjustments— — — (0.01)
Income tax effect(0.42)(0.44)(0.54)(1.19)
Effect of anti-dilutive securities— — — 0.03 
Non-GAAP Diluted earnings per common share$1.47 $0.30 $2.75 $2.85 
Shares used in diluted earnings per common share calculation:
GAAP42,184 39,784 40,894 39,535 
Non-GAAP42,184 39,870 41,347 39,731 
1
Income tax effect of unusual tax items: Excluded amounts primarily represent the impact of statutory tax rate changes on net deferred tax assets related to intellectual property in the Netherlands enacted during the third quarter of fiscal 2021 and amortization of intellectual property, impact of valuation allowance, and the release of tax reserves during the first quarter of fiscal 2020.


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PLANTRONICS, INC.
UNAUDITED RECONCILIATIONS OF GAAP MEASURES TO NON-GAAP MEASURES
($ in thousands)
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS DATA
 Three Months EndedTwelve Months Ended
December 28March 28,June 27,September 26,December 26,December 26,
201920202020202020202020
GAAP Net income (loss)$(78,483)$(662,820)$(75,015)$(13,405)$20,113 $(731,127)
Tax provision (19,708)(37,995)(3,177)3,013 (7,045)(45,204)
Interest expense 22,533 22,378 21,184 18,581 18,417 80,560 
Other income and expense (967)562 (224)(1,366)(2,596)(3,624)
Deferred revenue purchase accounting7,131 6,138 5,082 4,237 3,289 18,746 
Consumer optimization10,415 — — — — — 
Integration and rebranding costs8,677 2,321 197 — — 2,518 
Stock-based compensation13,902 15,596 9,360 10,263 11,486 46,705 
Restructuring and other related charges21,724 7,080 29,330 6,170 13,977 56,557 
Impairment charges — 648,231 — — — 648,231 
Loss, net from litigation settlements— — 17,561 — — 17,561 
Deferred compensation mark to market— — — 714 1,632 2,346 
Other adjustments— 419 — (185)— 234 
Depreciation and amortization57,556 57,632 43,400 40,971 40,510 182,513 
Adjusted EBITDA$42,780 $59,542 $47,698 $68,993 $99,783 $276,016 


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