1
TOTAL NUMBER OF PAGES 15
INDEX TO EXHIBITS AT PAGE 14
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
[ X ] Quarterly report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 For the quarterly period ended September 27,
1996
OR
[ ] Transition report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
For the transition period from to
Commission File No. 0-25826
HARMONIC LIGHTWAVES, INC.
(Exact name of Registrant as specified in its charter)
DELAWARE 77-0201147
(State of incorporation) (I.R.S. Employer Identification No.)
549 Baltic Way
Sunnyvale, CA 94089
(408) 542-2500
(Address, including zip code, and telephone number,
including area code, of Registrant's principal executive offices)
--------------
Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934
during the preceding 12 months (or for shorter period that the Registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes X No
--- ---
As of September 27, 1996 there were 10,152,035 shares of the Registrant's Common
Stock outstanding.
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HARMONIC LIGHTWAVES, INC.
Index
PART I - FINANCIAL INFORMATION Page
Item 1. Condensed Consolidated Financial Statements:
Condensed Consolidated Balance Sheets at September 27, 1996
and December 31, 1995......................................................................... 3
Condensed Consolidated Statements of Operations for the Three Months and Nine Months
Ended September 27, 1996 and September 29, 1995............................................... 4
Condensed Consolidated Statements of Cash Flows for the Nine Months Ended
September 27, 1996 and September 29, 1995..................................................... 5
Notes to Condensed Consolidated Financial Statements.......................................... 6
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations.............................................................. 7
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K....................................................... 12
2
3
PART I - FINANCIAL INFORMATION
Item 1. Condensed Consolidated Financial Statements
HARMONIC LIGHTWAVES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except share data)
SEPTEMBER 27, DECEMBER 31,
1996 1995
------------ -----------
(UNAUDITED)
ASSETS
Current assets:
Cash and cash equivalents $ 17,700 $ 22,126
Accounts receivable, net 12,693 5,802
Inventories 10,397 9,176
Prepaid expenses and other assets 1,216 199
-------- --------
Total current assets 42,006 37,303
Property and equipment, net 7,728 4,514
Other assets 1,204 --
-------- --------
$ 50,938 $ 41,817
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 5,604 $ 2,201
Accrued liabilities 4,183 2,607
-------- --------
Total current liabilities 9,787 4,808
-------- --------
Stockholders' equity:
Preferred stock, $.001 par value, 5,000,000 shares authorized;
no shares issued or outstanding -- --
Common Stock, $.001 par value, 50,000,000 shares authorized;
10,152,035 and 9,903,501 shares issued and outstanding 10 10
Capital in excess of par value 54,494 53,865
Accumulated deficit (13,353) (16,866)
-------- --------
Total stockholders' equity 41,151 37,009
-------- --------
$ 50,938 $ 41,817
======== ========
The accompanying notes are integral part of these financial statements.
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HARMONIC LIGHTWAVES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
(Unaudited)
THREE MONTHS ENDED NINE MONTHS ENDED
SEPTEMBER 27, SEPTEMBER 29, SEPTEMBER 27, SEPTEMBER 29,
--------------------------- -----------------------------
1996 1995 1996 1995
---------- ----------- -------- --------
Net sales $16,670 $10,659 $41,397 $28,503
Cost of sales 8,846 5,731 22,602 15,554
------- ------- ------- -------
Gross profit 7,824 4,928 18,795 12,949
------- ------- ------- -------
Operating expenses:
Research and development 2,617 1,755 6,548 4,509
Sales and marketing 2,732 1,404 6,968 4,107
General and administrative 865 619 2,325 1,525
------- ------- ------- -------
Total operating expenses 6,214 3,778 15,841 10,141
------- ------- ------- -------
Income from operations 1,610 1,150 2,954 2,808
Interest expense -- (60) -- (186)
Interest and other income (expense), net 223 340 744 453
------- ------- ------- -------
Income before income taxes 1,833 1,430 3,698 3,075
Provision for income taxes 92 72 185 154
------- ------- ------- -------
Net income $ 1,741 $ 1,358 $ 3,513 $ 2,921
======= ======= ======= =======
Net income per share
$ 0.15 $ 0.12 $ 0.31 $ 0.29
======= ======= ======= =======
Weighted average common
shares and equivalents 11,577 11,364 11,427 10,098
======= ======= ======= =======
The accompanying notes are an integral part of these financial statements.
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HARMONIC LIGHTWAVES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
NINE MONTHS ENDED
SEPTEMBER 27, SEPTEMBER 29,
1996 1995
------------ -------------
Cash flows from operating activities:
Net income $ 3,513 $ 2,921
Adjustments to reconcile net income to net cash
provided by (used in) operating activities:
Depreciation and amortization 1,803 1,143
Changes in assets and liabilities:
Accounts receivable (6,891) (2,158)
Inventories (1,221) (3,247)
Prepaid expenses and other assets (2,221) (151)
Accounts payable 3,403 426
Accrued liabilities 1,576 1,254
------- -------
Net cash (used in) provided by operating activities (38) 188
------- -------
Cash flows used in investing activities for the
acquisition of property and equipment (5,017) (1,273)
------- -------
Cash flows from financing activities:
Repayments under bank line of credit -- (922)
Repayments of long-term debt -- (1,825)
Proceeds from issuance of common stock, net 629 24,346
------- -------
Net cash provided by financing activities 629 21,599
------- -------
Net (decrease) increase in cash and cash equivalents (4,426) 20,514
Cash and cash equivalents at beginning of period 22,126 1,743
------- -------
Cash and cash equivalents at end of period $17,700 $22,257
======= =======
Supplemental schedule of cash flow information and
noncash financing activities:
Interest paid during the period -- $ 175
Income taxes paid during the period $ 134 $ 96
Issuance of common stock upon conversion of
mandatorily redeemable convertible preferred stock -- $29,215
Acquisition of property and equipment under capital
leases and equipment term loan -- $ 752
The accompanying notes are an integral part of these financial statements.
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6
HARMONIC LIGHTWAVES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1 - BASIS OF PRESENTATION
The accompanying financial statements include all adjustments
(consisting only of normal recurring adjustments) which Harmonic Lightwaves,
Inc. (the "Company") considers necessary for a fair presentation of the results
of operations for the interim periods covered and the financial condition of the
Company at the date of the balance sheets. The quarterly financial information
is unaudited. This Quarterly Report on Form 10-Q should be read in conjunction
with the Company's audited consolidated financial statements contained in the
Company's Annual Report on Form 10-K which was filed with the Securities and
Exchange Commission on March 29, 1996. The interim results presented herein are
not necessarily indicative of the results of operations that may be expected for
the full fiscal year ending December 31, 1996, or any other future period.
NOTE 2 - INVENTORIES (IN THOUSANDS)
SEPTEMBER 27, DECEMBER 31,
1996 1995
------------- ------------
(UNAUDITED)
Raw materials $ 2,374 $ 2,866
Work-in-process 4,378 2,372
Finished goods 3,645 3,938
------- -------
$10,397 $ 9,176
======= =======
NOTE 3 - INITIAL PUBLIC OFFERING
In May 1995, the Company completed its initial public offering ("IPO")
of 2,600,000 shares of common stock, 600,000 of which were sold by existing
stockholders, at a price of $13.50 per share. Net proceeds to the Company were
approximately $24.2 million, after underwriter commissions and associated costs.
Upon the closing of the IPO, all outstanding shares of Mandatorily Redeemable
Convertible Preferred Stock automatically converted into an equal number of
shares of Common Stock.
NOTE 4 - NET INCOME PER SHARE
Net income per share is computed using the weighted average number of
common and common equivalent shares outstanding during the period. Common
equivalent shares consist, where applicable, of Mandatorily Redeemable
Convertible Preferred Stock (using the if converted method), and stock options
and warrants (using the treasury stock method). Common equivalent shares are
excluded from the computation if their effect is antidilutive except that,
pursuant to the requirements of the Securities and Exchange Commission, common
equivalent shares relating to stock options and warrants (using the treasury
stock method and the initial public offering price) issued from April 1, 1994
through the date of the Company's IPO have been included in the computation for
all periods presented through the Company's IPO, even if antidilutive.
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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
OVERVIEW
Harmonic Lightwaves develops, manufactures and sells highly integrated fiber
optic transmission systems for emerging hybrid fiber coax ("HFC") cable
television networks. The Company's products include optical transmitters and
optical node receivers, return path transmitters and receivers, as well as
network management hardware and software. These products are used in HFC
networks by cable television and other broadband service providers.
This Quarterly Report on Form 10-Q 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. Actual results could differ materially from
those projected in the forward-looking statements as a result of the risk
factors set forth under "Factors That May Affect Future Results Of Operations"
below and elsewhere in this Form 10-Q.
RESULTS OF OPERATIONS
NET SALES
The Company's net sales increased 56% from $10.7 million in the third quarter of
1995 to $16.7 million in the third quarter of 1996. For the nine month periods,
net sales increased 45% from $28.5 million in the first nine months of 1995 to
$41.4 million in the first nine months of 1996. This growth in net sales was
primarily attributable to higher unit sales of the Company's existing products,
particularly the PWRLink transmitter and 1550 nm MaxLink transmission system
which began shipment during the second quarter of 1996. These factors were
partially offset by lower unit sales of the YAGLink optical transmitter and
lower selling prices for certain products. In the third quarter of 1996, both
domestic and international sales increased over the levels achieved in the third
quarter of 1995. International sales represented 55% of net sales in the third
quarter of 1996 compared to 68% of net sales in the third quarter of 1995.
The Company received a letter dated October 17, 1996 from Tele-Communications,
Inc. ("TCI"), asking it to stop product shipments to TCI until further notice.
Based on published reports, the Company believes that it was one of
approximately thirty equipment vendors to receive such a letter. In the third
quarter of 1996, sales to TCI represented approximately 5% of the Company's net
sales. The Company can not presently estimate when, if ever, it will be able to
resume shipments to TCI. There can be no assurance that the Company will be able
to replace shipments to TCI with shipments to new or existing customers or that,
if shipments to TCI are resumed, such shipments will approach their historical
level.
GROSS PROFIT
Gross profit increased from $4.9 million (46% of net sales) in the third quarter
of 1995 to $7.8 million (47% of net sales) in the third quarter of 1996 and from
$12.9 million in the first nine months of 1995 (45% of net sales) to $18.8
million (45% of net sales) in the first nine months of 1996. The increases in
gross profit were principally due to higher unit sales, a more favorable product
mix and lower material costs resulting from higher volumes, and were partially
offset by lower selling prices for certain products.
RESEARCH AND DEVELOPMENT
Research and development expenses increased from $1.8 million in the third
quarter of 1995 to $2.6 million in the third quarter of 1996, but remained
constant as a percentage of net sales at 16%, reflecting higher sales levels.
For the nine month periods, research and development expenses increased from
$4.5 million in 1995 to $6.5 million in 1996, but remained constant as a
percentage of net sales at 16% due to higher sales levels. The increases in
research and development expenses in both periods were principally attributable
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to increased headcount, particularly at the Company's Israeli
subsidiary, and increased use of outside subcontractors and consultants in
Israel and in connection with the network management and 1550 nm MaxLink
transmission system programs. Research and development expenses for the third
quarters of 1995 and 1996 and first nine months of 1995 and 1996 are net of
grants from the BIRD Foundation of approximately $33,000, $17,000, $233,000 and
$120,000 respectively. The Company anticipates that research and development
expenses will continue to increase substantially in absolute dollars, although
such expenses may vary as a percentage of net sales.
SALES AND MARKETING
Sales and marketing expenses increased from $1.4 million (13% of net sales) in
the third quarter of 1995 to $2.7 million (16% of net sales) in the third
quarter of 1996. For the nine month periods, sales and marketing expenses
increased from $4.1 million (14% of net sales) to $7.0 million (17% of net
sales). The increases in expenses were primarily due to higher headcount
associated with expansion of the direct sales force, customer service and
technical support organizations, as well as higher promotional expenses. The
Company intends to further expand its sales and marketing headcount during the
remainder of 1996 and anticipates that sales and marketing expenses will
continue to increase substantially in absolute dollars, although such expenses
may vary as a percentage of net sales.
GENERAL AND ADMINISTRATIVE
General and administrative expenses increased from $0.6 million (6% of net
sales) in the third quarter of 1995 to $0.9 million (5% of net sales) in the
third quarter of 1996. For the nine month periods, general and administrative
expenses increased from $1.5 million (5% of net sales) to $2.3 million (6% of
net sales). The increases in expenses were principally attributable to costs of
supporting the Company's growth in headcount and operations, and, to a lesser
extent, to certain costs associated with being a public company. The Company
expects to incur higher levels of general and administrative costs in the
future, although such expenses may vary as a percentage of net sales.
INTEREST AND OTHER INCOME (EXPENSE)
Interest and other income (expense) were $0.2 million and $0.7 million in the
three and nine month periods respectively, ended September 27, 1996, compared to
$0.3 million and $0.3 million in the corresponding periods of 1995. The decrease
in interest and other income in the third quarter of 1996 compared to the same
period of 1995 was principally attributable to lower interest income due to
lower cash balances and certain nonrecurring costs associated with the Company's
move to its new corporate headquarters in Sunnyvale, California in August
1996. The increase in interest and other income in the first nine months of 1996
compared to the same period of 1995 was principally due to interest earned on
higher average cash balances in 1996 following closing of the Company's IPO on
May 30, 1995.
INCOME TAXES
The provisions for income taxes for both periods of 1995 and 1996 were based on
an estimated effective annual tax rate of 5% resulting from federal and state
alternative minimum taxes. This rate reflects estimated future realization of
deferred tax assets, primarily net operating loss carryovers.
LIQUIDITY AND CAPITAL RESOURCES
The Company completed its initial public offering of Common Stock in May 1995,
raising approximately $24.2 million, net of offering costs. Prior to that, the
Company satisfied its liquidity needs primarily from the net proceeds of private
8
9
sales of Preferred Stock, and to a lesser extent, from capital equipment leases
and bank borrowings.
Cash (used) provided by operations was approximately $0.0 and $0.2
million for the nine months ended September 27, 1996 and September 29, 1995,
respectively. The decrease in cash provided by operations was primarily due to
higher accounts receivable and prepayment of rents and deposits of $2.1 million
in connection with the Company's new corporate headquarters, partially offset
by higher accounts payable, net income and depreciation expense. The increase
in accounts receivable during the first nine months of 1996 was attributable
principally to sales growth and higher days outstanding at September 27, 1996
compared to December 31, 1995 due to the seasonal pattern of sales in the
fourth quarter of 1995.
As of September 27, 1996, the Company had net working capital of $32.2 million,
including $17.7 million of cash and cash equivalents. During the third quarter,
the Company renegotiated its bank line of credit which now provides for up to
$10.0 million in borrowings and expires in September 1997. The line of credit
bears interest at the bank's prime rate or LIBOR plus 2.0%. There were no
outstanding borrowings under this line during the first nine months of 1996.
Additions to property, plant and equipment were approximately $5.0 million and
$2.0 million in the nine months ended September 27, 1996 and September 29, 1995,
respectively. The increase in 1996 compared to 1995 was due principally to
increased expenditures for manufacturing and test equipment resulting from
higher demand for the Company's products, introduction of new products, and
leasehold improvements and furniture and fixtures for the new facility. The
Company expects to spend approximately $6.0 million on capital expenditures in
1996.
The Company believes that its cash balances, anticipated funds generated from
operations, and funds available under its bank line of credit will be sufficient
to satisfy its cash requirements for at least the next twelve months.
FACTORS THAT MAY AFFECT FUTURE RESULTS OF OPERATIONS
Potential Fluctuations in Future Operating Results
The Company's operating results have fluctuated and are likely to continue to
fluctuate in the future, on an annual and a quarterly basis, as a result of a
number of factors, many of which are outside of the Company's control, including
the level of capital spending in the cable television industry, changes in the
regulatory environment, changes in market demand, the timing of customer orders,
competitive market conditions, lengthy sales cycles, new product introductions
by the Company or its competitors, market acceptance of new or existing
products, the cost and availability of components, the mix of the Company's
customer base and sales channels, the mix of products sold, the development of
custom products, the level of international sales and general economic
conditions. The Company establishes its expenditure levels for product
development and other operating expenses based on projected sales levels, and
expenses are relatively fixed in the short term. Accordingly, variations in
timing of sales can cause significant fluctuations in future operating results.
In addition, because a significant portion of the Company's business is derived
from orders placed by a limited number of large customers, the timing of such
orders can also cause significant fluctuations in the Company's operating
results. If sales are below expectations in any given quarter, the adverse
impact of the shortfall on the Company's operating results may be magnified by
the Company's inability to adjust spending to compensate for the shortfall.
Dependence on Key Customers and End Users
Historically, a substantial majority of the Company's sales have been to
relatively few customers. Sales to the Company's ten largest customers in 1994,
1995 and the first nine months of 1996 accounted for approximately 88%, 80% and
77%, respectively, of its net sales. Due in part to the consolidation of
ownership of domestic cable television systems, the Company expects that sales
to relatively few customers will continue to account for a significant
percentage of net sales for the foreseeable future. Substantially all of the
9
10
Company's sales are made on a purchase order basis, and none of the
Company's customers has entered into a long-term agreement requiring it to
purchase the Company's products. The loss of, or any reduction in orders from,
a significant customer, could have a material adverse effect on the Company's
business and operating results. The Company received a letter dated October 17,
1996 from Tele-Communications, Inc. ("TCI"), asking it to stop product
shipments to TCI until further notice. Based on published reports, the Company
believes that it was one of approximately thirty equipment vendors to receive
such a letter. In the third quarter of 1996, sales to TCI represented
approximately 5% of the Company's net sales. The Company can not presently
estimate when, if ever, it will be able to resume shipments to TCI. There can
be no assurance that the Company will be able to replace shipments to TCI with
shipments to new or existing customers or that, if shipments to TCI are
resumed, such shipments will approach their historical level.
Dependence on Cable Television Industry Capital Spending
To date, substantially all of the Company's sales have been derived, directly or
indirectly, from sales to cable television operators. Demand for the Company's
products depends to a significant extent upon the magnitude and timing of
capital spending by cable television operators for constructing, rebuilding or
upgrading their systems. The capital spending patterns of cable television
operators are affected by a variety of factors, including access to financing,
cable television operators' annual budget cycles, the status of federal, local
and foreign government regulation and television deregulation, overall demand
for cable television services, competitive pressures (including the availability
of alternative video delivery technologies such as satellite broadcasting),
discretionary customer spending patterns and general economic conditions. The
Company believes that the consolidation of ownership of domestic cable
television systems, by acquisition and system exchanges, together with
uncertainty over regulatory issues, particularly the debate over the provisions
of the Telecommunications Act of 1996, caused delays in capital spending by
major domestic MSOs during the second half of 1995 and first quarter of 1996.
Although the act was passed into law in February 1996 and the Company believes
that its provisions will result in increased capital expenditures in the
telecommunications industry, there can be no assurance that domestic MSOs will
increase capital spending in the near future, or at all, or that the Company's
sales will increase as a result of increased capital spending by the MSOs. In
addition, cable television capital spending can be subject to the effects of
seasonality, with fewer construction and upgrade projects typically occurring in
winter months and otherwise being affected by inclement weather.
Highly Competitive Industry
The market for cable television transmission equipment is extremely competitive
and has been characterized by rapid technological change. Most of the Company's
competitors are substantially larger and have greater financial, technical,
marketing and other resources than the Company. Many of such large competitors
are in a better position than the Company to withstand any significant reduction
in capital spending by cable television operators. In addition, many of the
Company's competitors have more long standing and established relationships with
domestic and foreign cable television operators than does the Company. There can
be no assurance that the Company will be able to compete successfully in the
future or that competition will not have a material adverse effect on the
Company's business and operating results.
Rapid Technological Change
The market for the Company's products is relatively new, making it difficult to
accurately predict the market's future growth rate, size and technological
direction. In view of the evolving nature of this market, there can be no
assurance that cable television operators, telephone companies or other
suppliers of broadband services will not decide to adopt alternative
architectures or technologies that are incompatible with the Company's products,
which would have a material adverse effect on the Company's business and
operating results.
The broadband communications markets are characterized by continuing
technological advancement. To compete successfully, the Company must design,
develop, manufacture and sell new products that provide
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11
increasingly higher levels of performance and reliability. As new markets for
fiber optic transmission equipment continue to develop, the Company must
successfully develop new products for these markets in order to remain
competitive. For example, to compete successfully in the future, the Company
believes that it must successfully develop and introduce products that will
facilitate fiber optic digital signal transmission, and that it must
successfully introduce and market a 1550nm transmission system. While the
Company began initial shipments of its 1550nm MaxLink transmission systems in
the second quarter of 1996, there can be no assurance that the Company will
successfully complete the introduction of its 1550nm MaxLink transmission
system, that the Company will successfully develop or introduce products that
will facilitate fiber optic digital signal transmission, or that such products
will achieve commercial acceptance. The failure of the Company to successfully
develop and introduce new products that address the needs of the broadband
communications market could have a material adverse effect on the Company's
business and operating results. In addition, there can be no assurance that the
successful introduction by the Company of new products will not have an adverse
effect on the sales of the Company's existing products. For instance, an
emerging trend in the domestic market toward narrowcasting (targeted delivery of
advanced services to small groups of subscribers) is causing changes in the
network architectures of some cable operators. This may have the effect of
changing the Company's product mix toward lower price transmitters, which could
adversely affect the Company's gross margins.
Sole or Limited Sources of Supply
Certain components and subassemblies necessary for the manufacture of the
Company's products are obtained from a sole supplier or a limited group of
suppliers. The reliance on sole or limited suppliers and the Company's
increasing reliance on subcontractors involve several risks, including a
potential inability to obtain an adequate supply of required components or
subassemblies and reduced control over pricing, quality and timely delivery of
components or subassemblies. The Company does not maintain long-term agreements
with any of its suppliers or subcontractors. An inability to obtain adequate
deliveries or any other circumstance that would require the Company to seek
alternative sources of supply could affect the Company's ability to ship its
products on a timely basis, which could damage relationships with current and
prospective customers and could have a material adverse effect on the Company's
business and operating results. The Company believes that investment in
inventories will constitute a significant portion of its working capital in the
future. As a result of such investment in inventories, the Company may be
subject to an increasing risk of inventory obsolescence in the future, which
would materially and adversely affect its business and operating results.
Risks of International Operations
Sales to customers outside of the United States, in 1995 and the first nine
months of 1996, represented 65% and 62% of net sales, respectively, and the
Company expects that international sales will continue to represent a
substantial portion of its net sales for the foreseeable future. In addition,
the Company has an Israeli subsidiary that engages primarily in research and
development. International operations are subject to a number of risks,
including changes in foreign government regulations and telecommunications
standards, export license requirements, tariffs and taxes, other trade barriers,
fluctuations in currency exchange rates, difficulty in collecting accounts
receivable, difficulty in staffing and managing foreign operations and political
and economic instability. While international sales are typically denominated in
U.S. dollars, fluctuations in currency exchange rates could cause the Company's
products to become relatively more expensive to customers in a particular
country, leading to a reduction in sales or profitability in that country.
Payment cycles for international customers are typically longer than those for
customers in the United States. There can be no assurance that foreign markets
will continue to develop or that the Company will receive additional orders to
supply its products for use in foreign broadband systems.
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PART II
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
A. Exhibits
Exhibit # Description of Document
11.1 Computation of Net Income Per Share
27.1 Financial Data Schedule
B. Reports on Form 8-K
The Company did not file any reports on Form 8-K during the three months
ended September 27, 1996.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
Dated: November 7, 1996
HARMONIC LIGHTWAVES, INC.
(Registrant)
By: /s/ Robin N. Dickson
--------------------------------------------
Robin N. Dickson
Chief Financial Officer
(Principal Financial and Accounting Officer)
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HARMONIC LIGHTWAVES, INC.
Index to Exhibits
EXHIBIT NO. DESCRIPTION OF DOCUMENT
11.1 Computation of Net Income Per Share
27.1 Financial Data Schedule
14
1
Exhibit 11.1
HARMONIC LIGHTWAVES, INC.
COMPUTATION OF NET INCOME PER SHARE
(In thousands, except per share data)
(Unaudited)
THREE MONTHS ENDED NINE MONTHS ENDED
SEPTEMBER 27, SEPTEMBER 29, SEPTEMBER 27, SEPTEMBER 29,
1996 1995 1996 1995
------------ ------------- ------------- -------------
Net income $ 1,741 $ 1,358 $ 3,513 $ 2,921
======= ======= ======= =======
Weighted average shares outstanding:
Common stock 10,150 9,812 10,072 8,607
Common stock issuable upon exercise
of options and warrants 1,427 1,552 1,355 1,491
------- ------- ------- -------
Weighted average common
shares and equivalents 11,577 11,364 11,427 10,098
======= ======= ======= =======
Net income per share (1)
$ 0.15 $ 0.12 $ 0.31 $ 0.29
======= ======= ======= =======
(1) Computed in the manner described in Note 4 to Notes to Condensed
Consolidated Financial Statements.
15
5
1,000
U.S. DOLLARS
9-MOS
DEC-31-1996
JAN-01-1996
SEP-27-1996
1
17,700
0
12,693
0
10,397
42,006
7,728
0
50,938
9,787
0
0
0
54,504
(13,353)
50,938
41,397
41,397
22,602
22,602
0
0
0
3,698
185
3,513
0
0
0
3,513
.31
.31
