Continued aggressive pricing in the entry-level 486 microprocessor market caused the decline in revenue and profit margins compared to the previous year. "The 486 market continued its slide during the third quarter, and our financial performance suffered as a result," said Jerry Rogers, Cyrix president and chief executive officer. "While the 5x86 processor made a very respectable contribution to overall revenues and a small number of 6x86 units were shipped late in the quarter, the decline in profits from our 486 products proved to be a significant drag on earnings."
"Our challenges in the fourth quarter are to sell our remaining 486 processors, increase the volume of 5x86 shipments, support 6x86 product introductions by our customers and begin production of the reduced die-size 6x86 processor," Rogers said. "If we execute, we'll enter 1996 in a position to support our customers with volume production of the 6x86 for the high-performance desk-top market and the 5x86 for the mobile computer market."
Cyrix Corporation, headquartered in Richardson, Texas, is a leading supplier of high-performance processors to the personal computer industry. Founded in 1988, the Company designs, manufactures and markets innovative, x86 software-compatible processors for the desktop and mobile computer markets. Cyrix is a publicly-held company traded on NASDAQ. It is the policy of Cyrix Corporation not to confirm analyst projections regarding future earnings.
September 30, December 31,
1995 1994
------------------------------
Assets
Cash, cash equivalents and investments $ 49,750 $ 59,241
Accounts receivable, net 40,540 41,995
Inventories 17,361 18,477
Deferred taxes and other assets 20,420 12,455
-----------------------------
Total current assets 128,071 132,168
Net property and equipment 99,848 38,047
Prepayments for product purchases,
less current portion 45,294 23,330
Deferred taxes and other assets 2,269 2,589
-----------------------------
Total assets $ 275,482 $ 196,134
=============================
Liabilities and Stockholders' Equity
Accounts payable $ 20,265 $ 27,180
Deferred income and distributor reserves 8,758 4,558
Income taxes payable 1,612 2,644
Current maturities of long-term debt and
capitalized lease obligations 18,869 4,544
Deferred litigation settlement -- 5,000
Other accrued expenses 7,812 8,227
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Current liabilities 57,316 52,153
Long-term debt, less current maturities 63,607 18,253
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Total liabilities 120,923 70,406
Stockholders' equity 154,559 125,728
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Total liabilities and stockholders' equity $ 275,482 $ 196,134
=============================
Quarter ended Sept.30 Nine months ended Sept.30
1995 1994 1995 1994
---------------------- ----------------------
Net sales $ 53,498 $ 68,099 $ 173,880 $ 173,075
Royalty revenue 74 -- 15,074 --
---------------------- ----------------------
Net revenues 53,572 68,099 188,954 173,055
Cost of sales 34,982 34,009 105,962 84,231
---------------------- ----------------------
Gross margin 18,590 34,090 82,992 88,844
---------------------- ----------------------
Marketing, general and administrative 8,755 11,308 29,135 33,821
Research and development 7,571 7,270 21,881 18,480
---------------------- ----------------------
Total operating expenses 16,326 18,578 51,016 52,301
---------------------- ----------------------
Income from operations 2,264 15,512 31,976 36,543
Income from litigation settlement -- -- 10,000 500
Net interest income (expense) (1,416) 514 (2,573) 857
---------------------- ----------------------
Income before taxes 848 16,026 39,403 37,900
Taxes on income 292 5,514 13,868 12,988
---------------------- ----------------------
Net income $ 556 $ 10,512 $ 25,535 $ 24,912
====================== ======================
Net income per common and common
equivalent share $0.03 $0.52 $1.28 $1.25
====================== ======================
Weighted average common and common
equivalent shares outstanding 20,126 20,113 19,910 19,971
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