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Poly Announces Fourth Quarter and Full-Year Fiscal 2022 Financial Results

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SANTA CRUZ, Calif., May 27, 2022 /PRNewswire/ -- Poly (NYSE: POLY), a global outfitter of professional-grade audio and video technology, today announced fourth quarter results for the period ended April 2, 2022.

Highlights for the fourth quarter and full-year fiscal 2022 include:
  • On March 28, 2022, Poly announced it had entered into a definitive merger agreement with HP, Inc. (NYSE: HPQ), a leading global provider of workplace solutions, in an all-cash transaction for $40 per share, implying a total enterprise value of approximately $3.3 billion, inclusive of Poly's net debt.


  • GAAP revenues for fiscal Q4 were $421M, a 12% year-over-year decline driven primarily by supply chain constraints impacting all product categories. Voice revenue grew 13% year over year but was offset by declines in Headsets and Video of -17% and -11%, respectively. Services revenue declined 20% from the prior year quarter.


  • For full fiscal year 2022 non-GAAP revenues declined -3% driven primarily by supply chain constraints. Video revenue of $485M was up 14% and Voice revenue of $247M was up 12% from the prior year. This was offset by Headset and Services revenues of $723M and $230M, which were down 12% and 15%, respectively, from the prior year.


  • Geographically for fiscal Q4, Americas revenue of $214M was down 8%, EMEA revenue of $144M was down 16%, and APAC revenue of $64M was down 14% from the prior year. For full-year fiscal 2022, Americas revenue of $890M was up 2%, EMEA revenue of $516M was down 11%, and APAC revenue of $279M was down 5% from the prior year.


  • Fiscal Q4 Non-GAAP gross margins of 43.9% were down 450bps from the prior year quarter. For the full year of fiscal 2022, gross margins declined 440bps, to 45.1%. The fiscal Q4 and full year gross margin declines were driven primarily by increased logistics costs and spot market purchases associated with global supply chain disruptions.


  • Poly continues to expand its portfolio of smart devices with the introduction of the Poly Studio R30 video bar, the Poly Sync 10 speakerphone, and enhancements to the Poly Lens platform. These solutions, combined with Poly DirectorAI smart camera technology, help employees look and sound their best, while employers can maintain focus on delivering meeting equity for hybrid and office workers alike.

 

($ Millions, except percent and per-share data)1

Q4 FY22

Q4 FY21


YTD FY22

YTD FY21

GAAP Revenue

$421

$476


$1,681

$1,728

GAAP Gross Margin

39.6  %

44.7  %


40.8  %

44.9  %

GAAP Operating (Loss) Income

($17)

$34


($32)

$13

GAAP Diluted EPS

($0.72)

$0.25


$0.41

($1.40)

Cash Flow from Operations

($8)

$74


($8)

$145







Non-GAAP Revenue

$422

$478


$1,685

$1,742

Non-GAAP Gross Margin

43.9  %

48.4%


45.1  %

49.5%

Non-GAAP Operating Income

$35

$76


$178

$262

Non-GAAP Diluted EPS

$0.50

$1.23


$2.44

$3.99

Adjusted EBITDA

$43

$86


$214

$302



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.

Business Outlook and Conference Call

In light of the pending merger of Poly with HP, Inc., Poly will not provide fiscal 2023 guidance and will not hold a conference call to discuss these results.

About Poly

Poly (NYSE: POLY) 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. Poly MeetingAI delivers a broadcast quality video conferencing experience with Poly DirectorAI technology which uses artificial intelligence and machine learning to deliver real-time automatic transitions, framing and tracking, while NoiseBlockAI and Acoustic Fence technologies block-out unwanted background noise. 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.

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

 

PLANTRONICS, INC.

SUMMARY CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(in thousands, except percentages and per share data)


UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS













Three Months Ended


Twelve Months Ended




April 2,


April 3,


April 2,


April 3,




2022


2021


2022


2021


Net revenues










   Net product revenues


$            369,178


$            410,980


$         1,455,785


$         1,470,826


   Net services revenues


52,204


65,253


225,359


256,781


     Total net revenues


421,382


476,233


1,681,144


1,727,607


Cost of revenues










   Cost of product revenues


235,151


240,811


917,511


863,529


   Cost of service revenues


19,206


22,606


77,540


87,527


     Total cost of revenues


254,357


263,417


995,051


951,056


Gross profit


167,025


212,816


686,093


776,551


   % of total net revenues


39.6 %


44.7 %


40.8 %


44.9 %


Operating expenses










   Research, development, and engineering


47,463


52,963


183,553


209,290


   Selling, general, and administrative


135,422


126,487


499,839


488,378


   Loss, net from litigation settlements





17,561


   Restructuring and other related charges


960


(773)


34,937


48,704


     Total operating expenses


183,845


178,677


718,329


763,933


Operating (loss) income


(16,820)


34,139


(32,236)


12,618


   % of total net revenues


(4.0) %


7.2 %


(1.9) %


0.7 %












Interest expense


15,840


24,424


69,711


82,606


Other non-operating expense (income), net


1,955


(920)


291


(5,108)


(Loss) income before income taxes


(34,615)


10,636


(102,238)


(64,880)


Income tax benefit


(3,722)


(341)


(120,155)


(7,549)


     Net (loss) income


$          (30,893)


$              10,977


$            17,917


$            (57,331)


       % of total net revenues


(7.3) %


2.3 %


1.1 %


(3.3) %












Basic (loss) earnings per common share


$               (0.72)


$                 0.26


$                 0.42


$               (1.40)


Diluted (loss) earnings per common share


$               (0.72)


$                 0.25


$                 0.41


$               (1.40)


Basic shares used in computing (loss) earnings per common share


42,922


41,482


42,568


41,044


Diluted shares used in computing (loss) earnings per common share


42,922


43,498


43,942


41,044












Effective tax rate


10.8 %


(3.2) %


117.5 %


11.6  %












 

PLANTRONICS, INC.

SUMMARY CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(in thousands)


UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS



April 2,


April 3,




2022


2021


ASSETS






   Cash and cash equivalents


$                         170,000


$                         202,560


   Restricted cash



493,908


   Short-term investments


13,703


14,559


     Total cash and cash equivalents, restricted cash, and short-term investments


183,703


711,027


   Accounts receivable, net


277,924


267,464


   Inventory, net


234,102


194,405


   Other current assets


83,410


65,214


     Total current assets


779,139


1,238,110


   Property, plant, and equipment, net


127,021


140,875


   Purchased intangibles, net


230,478


341,614


   Goodwill


796,216


796,216


   Deferred tax and other non-current assets


292,500


147,454


     Total assets


$                     2,225,354


$                     2,664,269








LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)






   Accounts payable


$                         168,610


$                         151,244


   Accrued liabilities


338,836


394,084


   Current portion of long-term debt



478,807


     Total current liabilities


507,446


1,024,135


   Long-term debt, net


1,500,283


1,496,064


   Long-term income taxes payable


68,082


86,227


   Other long-term liabilities


129,381


138,609


     Total liabilities


2,205,192


2,745,035


   Stockholders' equity (deficit)


20,162


(80,766)


     Total liabilities and stockholders' equity (deficit)


$                     2,225,354


$                     2,664,269








 

PLANTRONICS, INC.

SUMMARY CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(in thousands)


UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS













Three Months Ended


Twelve Months Ended




April 2,


April 3,


April 2,


April 3,




2022


2021


2022


2021


Cash flows from operating activities










   Net (loss) income


$           (30,893)


$            10,977


$            17,917


$           (57,331)


   Adjustments to reconcile net (loss) income to net cash (used in) provided by operating activities










     Depreciation and amortization


36,330


39,986


149,126


164,867


     Amortization of debt issuance cost


1,055


2,465


6,101


6,427


     Stock-based compensation


13,946


11,540


48,160


42,644


     Deferred income taxes


(6,038)


(5,801)


(121,698)


(21,174)


     Provision for excess and obsolete inventories


5,301


760


13,461


13,527


     Restructuring and other related charges


960


(773)


34,937


48,704


     Cash payments for restructuring charges


(4,178)


(4,970)


(31,693)


(33,764)


     Other operating activities


(913)


(2,862)


2,944


916


   Changes in assets and liabilities










     Accounts receivable, net


(2,801)


47,186


(11,370)


(24,253)


     Inventory, net


(20,792)


(2,053)


(45,491)


(41,994)


     Current and other assets


1,630


(4,537)


(11,783)


(22,487)


     Accounts payable


8,625


(16,001)


17,795


46,453


     Accrued liabilities


(1,192)


(2,054)


(47,793)


38,402


     Income taxes


(8,757)


168


(28,382)


(15,757)


       Net cash (used in) provided by operating activities


(7,717)


74,031


(7,769)


145,180












Cash flows from investing activities










   Proceeds from sales of short-term investments


2,507


1,862


2,771


2,529


   Purchases of short-term investments


(77)


(197)


(837)


(591)


   Capital expenditures


(9,040)


(5,962)


(29,722)


(22,715)


   Proceeds from sale of property, plant, and equipment





1,900


   Other investing activities


(2,020)



(6,020)



     Net cash used in investing activities


(8,630)


(4,297)


(33,808)


(18,877)












Cash flows from financing activities










   Employees' tax withheld and paid for restricted stock and restricted stock units


(911)


(2,737)


(13,065)


(5,930)


   Proceeds from issuances under stock-based compensation plans


5,943


6,576


11,784


12,307


   Proceeds from revolving line of credit





50,000


   Repayments of revolving line of credit





(50,000)


   Repayments of long-term debt



(100,000)


(480,689)


(146,980)


   Proceeds from debt issuance, net of issuance costs



493,922



493,922


     Net cash provided by (used in) financing activities


5,032


397,761


(481,970)


353,319


Effect of exchange rate changes on cash, cash equivalents and restricted cash


(1,385)


(1,092)


(2,921)


2,967


Net (decrease) increase in cash, cash equivalents, and restricted cash


(12,700)


466,403


(526,468)


482,589


Cash and cash equivalents and restricted cash at beginning of period


182,700


230,065


696,468


213,879


Cash and cash equivalents and restricted cash at end of period


$          170,000


$          696,468


$          170,000


$          696,468












 

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. Certain prior year amounts have been reclassified for consistency with current year presentation.

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 Services 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 guidance.
  • Stock compensation expense: Represents the non-cash expense associated with the Company's grant of stock-based awards to employees and non-employee directors.
  • Acquisition costs: Represents charges incurred in connection with the Merger Agreement with HP, such as advisory, legal and accounting fees.
  • Restructuring and other related charges: Represents costs associated with restructuring plans and reorganization actions aimed at improving the Company's overall cost structure, realigning resources consistent with its global strategy, and reducing expenses to enable strategic investments in revenue growth. 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 offices, and other related costs, including legal and advisory services.
  • 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 non-operating income, net.
  • Loss, net 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.
  • Income tax effects: Represents the tax effects of 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. The income tax effects for unusual tax items primarily represents the impact of the discrete tax benefit associated with an IP transfer between wholly-owned subsidiaries, changes in uncertain tax positions, and the full valuation allowance on United States federal and state deferred tax assets.

 

PLANTRONICS, INC.

UNAUDITED RECONCILIATIONS OF GAAP MEASURES TO NON-GAAP MEASURES

(in thousands, except percentages)


UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS DATA











Three Months Ended


Twelve Months Ended



April 2,


April 3,


April 2,


April 3,



2022


2021


2022


2021











GAAP Net revenues

$           421,382


$           476,233


$       1,681,144


$       1,727,607


   Deferred revenue purchase accounting

468


1,796


3,689


14,405


Non-GAAP Net revenues

$           421,850


$           478,029


$       1,684,833


$       1,742,012











GAAP Gross profit

$           167,025


$           212,816


$           686,093


$           776,551


   Purchase accounting amortization

16,317


16,239


65,031


68,111


   Deferred revenue purchase accounting

468


1,796


3,689


14,405


   Stock-based compensation

1,567


565


5,092


2,939


Non-GAAP Gross profit

$           185,377


$           231,416


$           759,905


$           862,006


Non-GAAP Gross profit %

43.9 %


48.4 %


45.1 %


49.5 %











GAAP Research, development, and engineering

$             47,463


$             52,963


$           183,553


$           209,290


   Stock-based compensation

(3,119)


(3,045)


(9,478)


(13,785)


Non-GAAP Research, development, and engineering

$             44,344


$             49,918


$           174,075


$           195,505











GAAP Selling, general, and administrative

$           135,422


$           126,487


$           499,839


$           488,378


   Purchase accounting amortization

(11,571)


(14,195)


(48,905)


(56,780)


   Stock-based compensation

(9,260)


(7,931)


(33,590)


(25,926)


   Acquisition costs

(9,530)



(9,530)



   Deferred compensation mark to market

908


(917)


(1,008)


(3,263)


   Other adjustments

315


2,103


689


2,100


Non-GAAP Selling, general, and administrative

$           106,284


$           105,547


$           407,495


$           404,509











 

PLANTRONICS, INC.

UNAUDITED RECONCILIATIONS OF GAAP MEASURES TO NON-GAAP MEASURES

(in thousands)


UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS DATA (CONTINUED)











Three Months Ended


Twelve Months Ended



April 2,


April 3,


April 2,


April 3,



2022


2021


2022


2021











GAAP Operating expenses

$          183,845


$          178,677


$          718,329


$          763,933


   Purchase accounting amortization

(11,571)


(14,195)


(48,905)


(56,780)


   Stock-based compensation

(12,379)


(10,976)


(43,068)


(39,711)


   Acquisition costs

(9,530)



(9,530)



   Restructuring and other related charges

(960)


773


(34,937)


(48,704)


   Deferred compensation mark to market

908


(917)


(1,008)


(3,263)


   Loss, net from litigation settlements




(17,561)


   Other adjustments

315


2,103


689


2,100


Non-GAAP Operating expenses

$          150,628


$          155,465


$          581,570


$          600,014











GAAP Operating (loss) income

$           (16,820)


$            34,139


$           (32,236)


$            12,618


   Purchase accounting amortization

27,888


30,434


113,936


124,891


   Stock-based compensation

13,946


11,541


48,160


42,650


   Acquisition costs

9,530



9,530



   Restructuring and other related charges

960


(773)


34,937


48,704


   Deferred revenue purchase accounting

468


1,796


3,689


14,405


   Deferred compensation mark to market

(908)


917


1,008


3,263


   Loss, net from litigation settlements




17,561


   Other adjustments

(315)


(2,103)


(689)


(2,100)


Non-GAAP Operating income

$            34,749


$            75,951


$          178,335


$          261,992











 

PLANTRONICS, INC.

UNAUDITED RECONCILIATIONS OF GAAP MEASURES TO NON-GAAP MEASURES

(in thousands, except per share data)


UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS DATA (CONTINUED)











Three Months Ended


Twelve Months Ended



April 2,


April 3,


April 2,


April 3,



2022


2021


2022


2021


GAAP Net (loss) income

$           (30,893)


$            10,977


$            17,917


$           (57,331)


   Purchase accounting amortization

27,888


30,434


113,936


124,891


   Stock-based compensation

13,946


11,541


48,160


42,650


   Acquisition costs

$               9,530



9,530



   Restructuring and other related charges

960


(773)


34,937


48,704


   Deferred revenue purchase accounting

468


1,796


3,689


14,405


   Deferred compensation mark to market

(24)


(29)


(69)


55


   Loss, net from litigation settlements




17,561


   Other adjustments

(315)


(2,103)


(689)


(2,095)


   Income tax effect of above items

3,569


4,198


2,791


(11,548)


   Income tax effect of unusual tax items

(2,967)


(2,410)


(123,187)


(9,832)


Non-GAAP Net income

$            22,162


$            53,631


$          107,015


$          167,460











GAAP Diluted (loss) earnings per common share

$               (0.72)


$                 0.25


$                 0.41


$               (1.40)


   Purchase accounting amortization

0.63


0.70


2.59


2.98


   Stock-based compensation

0.32


0.27


1.10


1.02


   Acquisition costs

0.22



0.22



   Restructuring and other related charges

0.02


(0.02)


0.80


1.16


   Deferred revenue purchase accounting

0.01


0.04


0.08


0.34


   Loss, net from litigation settlements




0.42


   Deferred compensation mark to market





   Other adjustments

(0.01)


(0.05)


(0.02)


(0.08)


   Income tax effect

0.01


0.04


(2.74)


(0.45)


   Effect of anti-dilutive securities

0.02





Non-GAAP Diluted earnings per common share

$                 0.50


$                 1.23


$                 2.44


$                 3.99











Shares used in diluted (loss) earnings per common share calculation:









   GAAP

42,922


43,498


43,942


41,044


   Non-GAAP

44,070


43,498


43,942


41,973











 

PLANTRONICS, INC.

UNAUDITED RECONCILIATIONS OF GAAP MEASURES TO NON-GAAP MEASURES

(in thousands)


UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS DATA (CONTINUED)














Three Months Ended


Twelve Months Ended




April 3,


July 3,


October 2,


January 1,


April 2,


April 2,




2021


2021


2021


2022


2022


2022


GAAP Net income (loss)


$                 10,977


$                (36,811)


$                 96,785


$                (11,164)


$                (30,893)


$                 17,917


   Income tax benefit


(341)


(4,262)


(102,567)


(9,604)


(3,722)


(120,155)


   Interest expense


24,424


21,782


16,141


15,948


15,840


69,711


   Other non-operating (income) expense, net


(920)


(692)


23


(995)


1,955


291


   Deferred revenue purchase accounting


1,796


1,260


1,054


907


468


3,689


   Stock-based compensation


11,540


10,416


11,573


12,225


13,946


48,160


   Acquisition costs






9,530


9,530


   Restructuring and other related charges


(773)


28,972


2,607


2,398


960


34,937


   Deferred compensation mark to market


917


994


13


910


(908)


1,009


   Other adjustments


(2,103)



(376)



(315)


(691)


   Depreciation and amortization


39,986


39,833


36,292


36,671


36,330


149,126


Adjusted EBITDA


$                 85,503


$                 61,492


$                 61,545


$                 47,296


$                 43,191


$               213,524
















 

Cision View original content:https://www.prnewswire.com/news-releases/poly-announces-fourth-quarter-and-full-year-fiscal-2022-financial-results-301556467.html

SOURCE Plantronics, Inc.

Plantronics, Inc.

NYSE:POLY

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Telephone Apparatus Manufacturing
Manufacturing
Link
United States
Santa Cruz

About POLY

Poly creates premium audio and video products so people can have the best meeting -- anywhere, anytime, every time. Its 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), people will do more than just show up, it will stand out.