•Net revenue of $315.5 million, up $12.1 million or 4.0% year-over-year
•GAAP operating margin of 12.9%, up 110 bps year-over-year
•Non-GAAP operating margin of 21.5%, up 130 bps year-over-year
•GAAP EPS of $0.08, up $0.01 or 14.3% year-over-year
•Non-GAAP EPS of $0.22, up $0.04 or 22.2% year-over-year
Scottsdale, Arizona, May 3, 2022 — VIAVI (NASDAQ: VIAV) today reported results for its third fiscal quarter ended April 2, 2022.
Third quarter of fiscal 2022 net revenue was $315.5 million. GAAP net income was $19.2 million, or $0.08 per share. Non-GAAP net income was $52.0 million, or $0.22 per share.
Second quarter of fiscal 2022 net revenue was $314.8 million. GAAP net income was $34.6 million or $0.14 per share. Non-GAAP net income was $59.3 million, or $0.24 per share.
Third quarter of fiscal 2021 net revenue was $303.4 million. GAAP net income was $17.2 million, or $0.07 per share. Non-GAAP net income was $42.3 million, or $0.18 per share.
“In fiscal Q3, VIAVI achieved new highs in revenue and non-GAAP operating profit for a March quarter. Business strength was led by Fiber and Wireless products with Anti-Counterfeiting and 3D Sensing products demand recovering from the December quarter,” said Oleg Khaykin, VIAVI’s President and Chief Executive Officer. “Revenue came in at $315.5 million, up 4.0% year-over-year, exceeding our guidance range of $301 to $315 million.”
Khaykin added, “As we look ahead, we expect fiscal 2022 to be another record year for revenue and profitability. We also continue to execute well on our plan to improve our capital structure to enable us to achieve financial flexibility. During fiscal Q3, we redeemed an additional $50.0 million in convertible notes which brings us to a cumulative principal retirement of 54% in fiscal 2022.”
Financial Overview:
The tables below (in millions, except percentage, and per share data) provide comparisons of quarterly results to prior periods, including sequential quarterly and year-over-year changes. A full reconciliation between the GAAP and non-GAAP measures included in the tables is contained in this release under the section titled “Use of Non-GAAP (Adjusted) Financial Measures.”
1
Third Quarter Ended April 2, 2022
GAAP Results
Q3
Q2
Q3
Change
FY 2022
FY 2022
FY 2021
Q/Q
Y/Y
Net revenue
$
315.5
$
314.8
$
303.4
0.2
%
4.0
%
Gross margin
59.2
%
60.5
%
60.0
%
(130) bps
(80) bps
Operating margin
12.9
%
15.7
%
11.8
%
(280) bps
110 bps
Income from operations
40.8
49.3
35.9
(17.2)
%
13.6
%
Net income per share
0.08
0.14
0.07
(42.9)
%
14.3
%
Non-GAAP Results
Q3
Q2
Q3
Change
FY 2022
FY 2022
FY 2021
Q/Q
Y/Y
Non-GAAP gross margin
62.0
%
63.2
%
63.1
%
(120) bps
(110) bps
Non-GAAP operating margin
21.5
%
23.3
%
20.2
%
(180) bps
130 bps
Non-GAAP income from operations
67.7
73.3
61.4
(7.6)
%
10.3
%
Non-GAAP net earnings per share
0.22
0.24
0.18
(8.3)
%
22.2
%
Net Revenue by Segment
Q3
Q2
Q3
Change
FY 2022
FY 2022
FY 2021
Q/Q
Y/Y
Network Enablement
$
204.3
$
214.4
$
190.9
(4.7)
%
7.0
%
Service Enablement
26.5
29.8
20.3
(11.1)
%
30.5
%
Optical Security and Performance Products
84.7
70.6
92.2
20.0
%
(8.1)
%
Total
$
315.5
$
314.8
$
303.4
0.2
%
4.0
%
•Americas, Asia-Pacific and EMEA customers represented 34.5%, 36.3% and 29.2%, respectively, of total net revenue for the quarter ended April 2, 2022.
•As of April 2, 2022, the Company held $596.0 million in total cash, short-term restricted cash and short-term investments.
•As of April 2, 2022, the Company had $227.0 million aggregate principal amount of 1.00% Senior Convertible Notes, $87.4 million aggregate principal amount of 1.75% Senior Convertible Notes and $400 million aggregate principal amount of 3.75% Senior Notes with a total net carrying value of $706.4 million classified as long-term debt.
•During the fiscal quarter ended April 2, 2022, the Company generated $28.9 million of cash from operations.
Business Outlook for the Fourth Quarter of Fiscal 2022
For the fourth quarter of fiscal 2022 ending July 2, 2022, the Company expects net revenue to be between $315 million to $329 million and non-GAAP earnings per share to be between $0.22 to $0.24.
With respect to our expectations above, the Company has not reconciled non-GAAP net income per share to GAAP net income (loss) per share in this press release because it is unable to provide a meaningful or accurate estimate of certain reconciling items described in the “Use of Non-GAAP (Adjusted) Financial Measures” section below and the information is not available without unreasonable effort as a result of the inherent difficulty of forecasting the timing and/or amounts of certain items, including certain charges related to restructuring, acquisition, integration and related charges. In addition, the Company believes such reconciliations would imply a degree of precision that may be confusing or misleading to investors.
2
Conference Call
The Company will discuss these results and other related matters at 1:30 p.m. Pacific Time on May 3, 2022 in a live webcast, which will also be archived for replay on the Company’s website at https://investor.viavisolutions.com. The Company will post supplementary slides outlining the Company’s latest financial results on https://investor.viavisolutions.com under the “Quarterly Results” section concurrently with this earnings press release. This press release is being furnished as a Current Report on Form 8-K with the Securities and Exchange Commission, and will be available at www.sec.gov.
3
About VIAVI Solutions
VIAVI (NASDAQ: VIAV) is a global provider of network test, monitoring and assurance solutions for communications service providers, enterprises, network equipment manufacturers, government and avionics. We help these customers harness the power of instruments, automation, intelligence and virtualization to Command the network. VIAVI is also a leader in light management solutions for 3D sensing, anti-counterfeiting, consumer electronics, industrial, automotive and defense applications. Learn more about VIAVI at https://www.viavisolutions.com. Follow us on VIAVI Perspectives, LinkedIn, Twitter, YouTube and Facebook.
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 any expectation, anticipation or guidance as to future financial performance, including future revenue, gross margin, operating expense, operating margin, profitability targets, cash flow and other financial metrics, as well as the impact and duration of certain trends and market position and conditions. These forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those projected. In particular, the Company’s ability to predict future financial performance continues to be difficult due to, among other things: (a) continuing general limited visibility across many of our product lines; (b) quarter-over-quarter product mix fluctuations, which can materially impact profitability measures due to the broad gross margin ranges across our portfolio; (c) consolidations in our customer base; (d) unforeseen changes in the demand for current and new products, technologies, services, delays or unforeseen events in the roll-out of new industry platforms such as 5G or evolving technology such as 3D sensing and customer purchasing delays as they assess or transition to such new technologies and/or architectures, all of which limit near-term demand visibility, and could negatively impact potential revenue; (e) continued decline of average selling prices across our businesses; (f) notable seasonality and a significant level of in-quarter book-and-ship business; (g) various product and manufacturing transfers, site consolidations, product discontinuances and restructuring and workforce reduction plans; (h) challenges integrating the businesses the Company has acquired and realizing all of the expected benefits and savings; (i) supply chain and materials constraints and the ability of our suppliers and contract manufacturers to meet production and delivery requirements to our forecasted demand; (j) potential disruptions or delays to our manufacturing and operations due to climate conditions and natural disasters in the regions where we operate, such as wildfires, drought conditions and related water shortages in Arizona, as well as wildfires in Northern California and related blackouts and power outages in that region; (k) the uncertain and ongoing impact to our supply chain of military conflicts, such as the escalating conflict between Russia and Ukraine, tariffs, sanctions and other trade measures imposed by domestic and foreign governments and the possibility of escalation of “trade wars,” cyber-attacks, and retaliatory measures; (l) the impact of infectious disease outbreaks, epidemics, and pandemics including the ongoing effects of the COVID-19 global pandemic on our financial results, revenues, customer demand, business operations and manufacturing and on the business operations of our customers, contract manufacturers and suppliers; and (m) inherent uncertainty related to global markets, including inflationary pressures, recessions and tightening liquidity and the effect of such markets on demand for our products. These forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those projected. For more information on these risks, please refer to the “Risk Factors” section included in the Company’s Annual Report on Form 10-K for the fiscal year ended July 3, 2021 filed with the Securities and Exchange Commission. The forward-looking statements contained in this press release are made as of the date thereof and the Company assumes no obligation to update such statements.
Contact Information
Investors:
Sagar Hebbar
408-404-4507
sagar.hebbar@viavisolutions.com
Press:
Amit Malhotra
202-341-8624
amit.malhotra@viavisolutions.com
The following financial tables are presented in accordance with GAAP, unless otherwise specified.
-SELECTED PRELIMINARY FINANCIAL DATA -
4
VIAVI SOLUTIONS INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in millions, except per share data)
(unaudited)
PRELIMINARY
Three Months Ended
Nine Months Ended
April 2, 2022
April 3, 2021
April 2, 2022
April 3, 2021
Net revenue
$
315.5
$
303.4
$
957.1
$
888.0
Cost of revenues
121.2
113.1
362.0
331.6
Amortization of acquired technologies
7.4
8.3
22.7
24.9
Gross profit
186.9
182.0
572.4
531.5
Operating expenses:
Research and development
54.9
52.1
159.0
150.9
Selling, general and administrative
89.0
86.1
269.0
247.0
Amortization of other intangibles
2.2
8.3
7.5
24.9
Restructuring and related benefits
—
(0.4)
(0.1)
(0.8)
Total operating expenses
146.1
146.1
435.4
422.0
Income from operations
40.8
35.9
137.0
109.5
Interest income and other income (expense), net
(5.8)
(0.9)
(95.6)
0.8
Interest expense
(6.4)
(3.6)
(17.1)
(10.8)
Income before income taxes
28.6
31.4
24.3
99.5
Provision for income taxes
9.4
14.2
25.3
35.3
Net income (loss)
$
19.2
$
17.2
$
(1.0)
$
64.2
Net income (loss) per share:
Basic
$
0.08
$
0.08
$
—
$
0.28
Diluted
$
0.08
$
0.07
$
—
$
0.27
Shares used in per share calculations:
Basic
229.2
228.7
232.1
228.8
Diluted
236.8
240.2
232.1
234.4
The preliminary financial statements are estimated based on our current information.
5
VIAVI SOLUTIONS INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in millions, unaudited)
PRELIMINARY
April 2, 2022
July 3, 2021
ASSETS
Current assets:
Cash and cash equivalents
$
589.8
$
697.8
Short-term investments
1.6
1.6
Restricted cash
4.6
4.3
Accounts receivable, net
269.3
256.5
Inventories, net
113.9
94.9
Prepayments and other current assets
64.8
57.0
Total current assets
1,044.0
1,112.1
Property, plant and equipment, net
221.2
196.0
Goodwill, net
388.9
396.5
Intangibles, net
58.2
88.0
Deferred income taxes
101.7
109.3
Other non-current assets
64.0
59.5
Total assets
$
1,878.0
$
1,961.4
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable
$
58.3
$
63.2
Accrued payroll and related expenses
57.7
76.0
Deferred revenue
78.1
69.7
Accrued expenses
30.2
24.8
Current portion of long-term debt
—
456.6
Other current liabilities
35.4
57.1
Total current liabilities
259.7
747.4
Long-term debt
706.4
224.1
Other non-current liabilities
202.0
226.0
Total stockholders’ equity
709.9
763.9
Total liabilities and stockholders’ equity
$
1,878.0
$
1,961.4
The preliminary financial statements are estimated based on our current information.
6
VIAVI SOLUTIONS INC.
REPORTABLE SEGMENT INFORMATION
(in millions, unaudited)
PRELIMINARY
Three Months Ended April 2, 2022
Network and Service Enablement
Network Enablement
Service Enablement
Network and Service Enablement
Optical Security and Performance Products
Other Items (1)
Consolidated GAAP Measures
Net revenue
$
204.3
$
26.5
$
230.8
$
84.7
$
—
$
315.5
Gross profit
$
130.3
$
18.3
$
148.6
$
47.0
$
(8.7)
$
186.9
Gross margin
63.8
%
69.1
%
64.4
%
55.5
%
59.2
%
Operating income
$
34.4
$
33.3
$
(26.9)
$
40.8
Operating margin
14.9
%
39.3
%
12.9
%
Three Months Ended April 3, 2021
Network and Service Enablement
Network Enablement
Service Enablement
Network and Service Enablement
Optical Security and Performance Products
Other Items (1)
Consolidated GAAP Measures
Net revenue
$
190.9
$
20.3
$
211.2
$
92.2
$
—
$
303.4
Gross profit
$
123.1
$
12.4
$
135.5
$
55.9
$
(9.4)
$
182.0
Gross margin
64.5
%
61.1
%
64.2
%
60.6
%
60.0
%
Operating income
$
20.9
$
40.5
$
(25.5)
$
35.9
Operating margin
9.9
%
43.9
%
11.8
%
Nine Months Ended April 2, 2022
Network and Service Enablement
Network Enablement
Service Enablement
Network and Service Enablement
Optical Security and Performance Products
Total Segment Measures
Other Items (1)
Consolidated GAAP Measures
Net revenue
$
623.6
$
79.3
$
702.9
$
254.2
$
957.1
$
—
$
957.1
Gross profit
$
401.0
$
54.4
$
455.4
$
143.8
$
599.2
$
(26.8)
$
572.4
Gross margin
64.3
%
68.6
%
64.8
%
56.6
%
62.6
%
59.8
%
Operating income
$
110.7
$
104.6
$
215.3
$
(78.3)
$
137.0
Operating margin
15.7
%
41.1
%
22.5
%
14.3
%
Nine Months Ended April 3, 2021
Network and Service Enablement
Network Enablement
Service Enablement
Network and Service Enablement
Optical Security and Performance Products
Total Segment Measures
Other Items (1)
Consolidated GAAP Measures
Net revenue
$
533.9
$
67.5
$
601.4
$
286.6
$
888.0
$
—
$
888.0
Gross profit
$
339.9
$
44.3
$
384.2
$
175.3
$
559.5
$
(28.0)
$
531.5
Gross margin
63.7
%
65.6
%
63.9
%
61.2
%
63.0
%
59.9
%
Operating income
$
56.4
$
132.4
$
188.8
$
(79.3)
$
109.5
Operating margin
9.4
%
46.2
%
21.3
%
12.3
%
(1) Other items include charges unrelated to core operating performance primarily consisting of stock-based compensation, amortization of acquisition-related intangibles, restructuring and related charges, changes in fair value of contingent consideration liabilities and other charges unrelated to core operating performance.
The preliminary financial schedules are estimated based on our current information.
7
Use of Non-GAAP (Adjusted) Financial Measures
The Company provides non-GAAP gross margin, non-GAAP operating margin, non-GAAP net income (loss), non-GAAP net income (loss) per share, EBITDA and adjusted EBITDA financial measures as supplemental information regarding the Company’s operational performance. The Company uses the measures disclosed in this release to evaluate the Company’s historical and prospective financial performance, as well as its performance relative to its competitors. Specifically, management uses these items to further its own understanding of the Company’s core operating performance, which the Company believes represent its performance in the ordinary, ongoing and customary course of its operations. Accordingly, management excludes from core operating performance items such as those relating to certain purchase price accounting adjustments, amortization of acquisition-related intangibles and inventory step-up, stock-based compensation, restructuring, separation costs, changes in fair value of contingent consideration liabilities and certain investing expenses and non-cash activities that management believes are not reflective of such ordinary, ongoing and customary course activities. Additionally, the Company excludes the results of discontinued operations in calculating non-GAAP net income (loss), non-GAAP net income (loss) per share, EBITDA and adjusted EBITDA for all periods reported. The Company believes excluding these items enables investors to evaluate more clearly and consistently the Company’s core operational performance.
The Company believes providing this additional information allows investors to see Company results through the eyes of management. The Company further 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 performance.
The non-GAAP adjustments described in this release are excluded by the Company from its non-GAAP financial measures. The non-GAAP adjustments, and the basis for excluding them, are outlined below.
Cost of revenues, costs of research and development and costs of selling, general and administrative: The Company’s GAAP presentation of gross margin and operating expenses may include (i) additional depreciation and amortization from changes in estimated useful life and the write-down of certain property, equipment and intangibles that have been identified for disposal but remained in use until the date of disposal, (ii) workforce related charges such as severance, retention bonuses and employee relocation costs related to formal restructuring plans, (iii) costs for facilities not required for ongoing operations, and costs related to the relocation of certain equipment from these facilities and/or contract manufacturer facilities, (iv) stock-based compensation, (v) changes in fair value of contingent consideration liabilities and (vi) other charges unrelated to our core operating performance comprising mainly of acquisition related transaction costs, amortization of acquisition related inventory step-up, integration costs related to acquired entities, litigation and other costs and contingencies unrelated to current and future operations, including transformational initiatives such as the implementation of simplified automated processes, site consolidations, and reorganizations. The Company excludes these items in calculating non-GAAP gross margin, non-GAAP operating margin, non-GAAP net income (loss), non-GAAP net income (loss) per share, EBITDA and adjusted EBITDA. The Company believes excluding these items enables investors to evaluate more clearly and consistently the Company’s core operational performance.
Amortization of intangibles: The Company includes amortization expense related to intangibles in its GAAP presentation of cost of revenues and operating expense. The Company excludes these significant non-cash items in calculating non-GAAP gross margin, non-GAAP operating margin, non-GAAP net income (loss), non-GAAP net income (loss) per share, EBITDA and adjusted EBITDA, because it believes doing so provides investors a clearer and more consistent view of the Company’s core operating performance in terms of cost of revenues and operating expenses.
Non-cash interest expense and other expense: The Company incurred a loss of $6.4M and $98.7M for the three and nine months ended April 2, 2022, respectively, in connection with the repurchase of certain 1.00% and 1.75% Senior Convertible Notes which was recorded in interest income and other income (expense), net, in compliance with authoritative guidance. The Company eliminates this in calculating non-GAAP net income (loss), and non-GAAP net income (loss) per share, EBITDA and adjusted EBITDA, because it believes that in so doing, it can provide investors a clearer and more consistent view of the Company’s core operating performance.
Income tax expense or benefit: The Company excludes certain non-cash tax expense or benefit items, such as the utilization of net operating losses where valuation allowances were released, intra-period tax allocation benefit and the tax effect for amortization of non-tax deductible intangible assets, in calculating non-GAAP net income (loss) and non-GAAP net income (loss) per share. The Company believes excluding these items enables investors to evaluate more clearly and consistently the Company’s core operational performance.
8
Interest, taxes, depreciation, amortization and other adjustments: The Company’s EBITDA calculation primarily excludes interest income and other income (expense), interest expense, taxes, depreciation and amortization, and other items that are not part of its core operating performance described above. The Company’s adjusted EBITDA excludes items in addition to the items excluded from the EBITDA calculation such as stock-based compensation, restructuring and related charges (benefits), gain or loss on sale of available for-sale investments, changes in fair value of contingent consideration liabilities arising from prior acquisitions and other charges related to activities that are not part of its core operating performance described above. Management believes adjusted EBITDA is a helpful indicator of the Company’s core operational cash flow.
Non-GAAP financial measures are not in accordance with, preferable to, or an alternative for, generally accepted accounting principles in the United States. The GAAP measure most directly comparable to non-GAAP net income (loss) is net income (loss). The GAAP measure most directly comparable to non-GAAP net income (loss) per share is net income (loss) per share. The Company believes these GAAP measures alone are not fully indicative of its core operating expenses and performance and that providing non-GAAP financial measures in conjunction with GAAP measures provides valuable supplemental information regarding the Company’s overall performance.
9
VIAVI SOLUTIONS INC.
RECONCILIATION OF GAAP MEASURES FROM CONTINUING OPERATIONS
TO NON-GAAP MEASURES
(in millions, except per share data)
(unaudited)
PRELIMINARY
The following tables reconcile GAAP measures to non-GAAP measures:
Three Months Ended
Nine Months Ended
April 2, 2022
April 3, 2021
April 2, 2022
April 3, 2021
Gross Profit
Gross Margin
Gross Profit
Gross Margin
Gross Profit
Gross Margin
Gross Profit
Gross Margin
GAAP measures
$
186.9
59.2
%
$
182.0
60.0
%
$
572.4
59.8
%
$
531.5
59.9
%
Stock-based compensation
1.2
0.4
%
1.2
0.4
%
4.0
0.4
%
3.6
0.4
%
Other charges (benefits) unrelated to core operating performance (1)
0.1
—
%
(0.1)
—
%
0.1
—
%
(0.5)
(0.1)
%
Amortization of intangibles
7.4
2.4
%
8.3
2.7
%
22.7
2.4
%
24.9
2.8
%
Total related to Cost of Revenue
8.7
2.8
%
9.4
3.1
%
26.8
2.8
%
28.0
3.1
%
Non-GAAP measures
$
195.6
62.0
%
$
191.4
63.1
%
$
599.2
62.6
%
$
559.5
63.0
%
Three Months Ended
Nine Months Ended
April 2, 2022
April 3, 2021
April 2, 2022
April 3, 2021
Operating Income
Operating Margin
Operating Income
Operating Margin
Operating Income
Operating Margin
Operating Income
Operating Margin
GAAP measures
$
40.8
12.9
%
$
35.9
11.8
%
$
137.0
14.3
%
$
109.5
12.3
%
Stock-based compensation
12.8
4.1
%
11.0
3.6
%
39.7
4.1
%
33.4
3.8
%
Change in fair value of contingent liability
—
—
%
(2.3)
(0.8)
%
0.3
—
%
(3.8)
(0.4)
%
Other charges unrelated to core operating performance (1)
4.5
1.4
%
0.6
0.2
%
8.2
0.9
%
0.7
0.1
%
Amortization of intangibles
9.6
3.1
%
16.6
5.5
%
30.2
3.2
%
49.8
5.6
%
Restructuring and related benefits
—
—
%
(0.4)
(0.1)
%
(0.1)
—
%
(0.8)
(0.1)
%
Total related to Cost of Revenue and Operating Expenses
26.9
8.6
%
25.5
8.4
%
78.3
8.2
%
79.3
9.0
%
Non-GAAP measures
$
67.7
21.5
%
$
61.4
20.2
%
$
215.3
22.5
%
$
188.8
21.3
%
Three Months Ended
Nine Months Ended
April 2, 2022
April 3, 2021
April 2, 2022
April 3, 2021
Net Income
Diluted EPS
Net Income
Diluted EPS
Net income (loss)
Diluted EPS
Net Income
Diluted EPS
GAAP measures
$
19.2
$
0.08
$
17.2
$
0.07
$
(1.0)
$
—
$
64.2
$
0.27
Items reconciling GAAP net income (loss) and EPS to non-GAAP net income and EPS:
Stock-based compensation
12.8
0.05
11.0
0.05
39.7
0.17
33.4
0.14
Change in fair value of contingent liability
—
—
(2.3)
(0.01)
0.3
—
(3.8)
(0.01)
Other charges unrelated to core operating performance (1)
4.5
0.02
0.6
—
8.2
0.03
0.7
—
Amortization of intangibles
9.6
0.04
16.6
0.07
30.2
0.13
49.8
0.21
Restructuring and related benefits
—
—
(0.4)
—
(0.1)
—
(0.8)
—
Non-cash interest expense and other expense
6.5
0.03
0.2
—
99.2
0.43
0.2
—
Benefit from income taxes
(0.6)
—
(0.6)
—
(7.0)
(0.03)
(1.0)
—
Total related to net income and EPS
32.8
0.14
25.1
0.11
170.5
0.73
78.5
0.34
Non-GAAP measures
$
52.0
$
0.22
$
42.3
$
0.18
$
169.5
$
0.73
$
142.7
$
0.61
Shares used in per share calculation for Non-GAAP EPS
236.8
240.2
232.1
234.4
Note: Certain totals may not add due to rounding.
(1) Other items include charges (benefits) unrelated to core operating performance primarily consisting of acquisition and integration related charges, transformational initiatives such as site consolidations, and reorganization, loss on sale of investments and loss on disposal of long-lived assets.
The preliminary financial schedules are estimated based on our current information.
10
VIAVI SOLUTIONS INC.
RECONCILIATION OF GAAP MEASURES FROM CONTINUING OPERATIONS
TO ADJUSTED EBITDA
(in millions, unaudited)
PRELIMINARY
Three Months Ended
Nine Months Ended
April 2, 2022
April 3, 2021
April 2, 2022
April 3, 2021
GAAP net income (loss)
$
19.2
$
17.2
$
(1.0)
$
64.2
Interest income and other (income) expense, net
5.8
0.9
95.6
(0.8)
Interest expense
6.4
3.6
17.1
10.8
Provision for income taxes
9.4
14.2
25.3
35.3
Depreciation
12.3
9.2
30.1
26.8
Amortization
9.6
16.6
30.2
49.8
EBITDA
62.7
61.7
197.3
186.1
Restructuring and related benefits
—
(0.4)
(0.1)
(0.8)
Stock-based compensation
12.8
11.0
39.7
33.4
Change in fair value of contingent liability
—
(2.3)
0.3
(3.8)
Other charges unrelated to core operating performance (1)
4.5
0.6
8.2
0.7
Adjusted EBITDA
$
80.0
$
70.6
$
245.4
$
215.6
Note: Certain totals may not add due to rounding.
(1) Other items include charges unrelated to core operating performance primarily consisting of acquisition and integration related charges, transformational initiatives such as site consolidations, and reorganization, loss on sale of investments and loss on disposal of long-lived assets.
The preliminary financial schedules are estimated based on our current information.
