Revenues for the second quarter of 2005 were $2.7 million compared to $3.7 million for the same period last year. Net loss for the second quarter of 2005 was $1.5 million, or $0.07 per share, compared to a net loss of $0.8 million, or $0.04 per share, for the year-ago period.
For the six months ended June 30, 2005, revenues were $6.9 million compared to $7.3 million in the same period last year. Net loss for the six months ended June 30, 2005 was $1.8 million or $0.08 per share, compared to a net loss of $2.0 million, or $0.09 per share, for the year-ago period.
Michael Tzannes, Aware's chief executive officer commented, "We are increasingly confident that our StratiPHY(TM) product family combined with our business model are a recipe for success. We invite you to listen to our conference call today, where we will layout a detailed roadmap for our licensing business and the reason for our optimism." Specifically, Aware will present:
* Changes underway in the ADSL industry and why they are positive for Aware * The economic challenges facing the DSL semiconductor industry * The Aware solution and why and how Aware can succeed * Reasons we are on the right track
"We will also discuss progress in our test and diagnostics and biometrics and medical imaging product and market development efforts."
Tzannes added, "From the conclusion of today's conference call until Monday, August 8 at 5:00 p.m., we invite interested parties to submit investor questions via email to Email Contact. We will post questions and answers later in the week on our website."
Note: Aware's conference call will be broadcast live over the Internet today, August 4, 2005 at 5:00 p.m. Eastern Time. To listen to the call, please go to http://www.aware.com, and click on "Investor Relations." The conference call may also be heard by calling (719) 457-2629 and referencing the confirmation number 4164001. A replay of the call will be archived on our website after the call.
Aware, Inc. designs, develops, licenses and markets DSL technologies that enable broadband communications over existing telephone networks. Its solutions, including splitterless G.lite, full-rate ADSL, ADSL2, ADSL2+, VDSL2, Bonded ADSL2+, Dr. DSL(R), StratiPHY(TM), StratiPHY-Bonded(TM), StratiPHY2+(TM), StratiPHY3(TM) and G.SHDSL, address central office as well as customer premise requirements. Aware is also a leading provider of standards- based biometric transaction and image compression software toolkits. More information can be found at http://www.aware.com.
Safe Harbor Warning
Portions of this release contain forward-looking statements regarding future events and are subject to risks and uncertainties, such as estimates or projections of future revenue and earnings and the growth of the DSL market. Aware wishes to caution you that there are factors that could cause actual results to differ materially from the results indicated by such statements. These factors include, but are not limited to: we have a unique business model, our quarterly results are difficult to predict, we depend on a limited number of licensees, we derive a significant amount of revenue from a small number of customers, we depend on equipment companies to incorporate our technology into their products, we face intense competition from other DSL vendors, DSL technology competes with other technologies for broadband access, and our business is subject to rapid technological change. We refer you to the documents Aware files from time to time with the Securities and Exchange Commission, specifically the section titled Risk Factors in our quarterly report on Form 10-Q for the quarter ended March 31, 2005 and other reports and filings made with the Securities and Exchange Commission.
Dr. DSL, StratiPHY, StratiPHY2+, StratiPHY3, and StratiPHY-Bonded are trademarks or registered trademarks of Aware, Inc.
AWARE, INC. CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except per share data) Three Months Ended Six Months Ended June 30, June 30, 2005 2004 2005 2004 Revenue: Product sales $785 $1,028 $1,746 $2,251 Contract revenue 978 1,791 3,141 3,069 Royalties 920 906 2,020 2,007 Total revenue 2,683 3,725 6,907 7,327 Costs and expenses: Cost of product sales 62 195 122 532 Cost of contract revenue 718 653 1,558 1,320 Research and development 2,360 2,503 4,913 5,174 Selling and marketing 710 667 1,343 1,271 General and administrative 627 630 1,296 1,223 Total costs and expenses 4,477 4,648 9,232 9,520 Loss from operations (1,794) (923) (2,325) (2,193) Interest income 272 115 489 238 Loss before provision for income taxes ($1,522) (808) (1,836) (1,955) Provision for income taxes - - - - Net loss ($1,522) ($808) ($1,836) ($1,955) Net loss per share - basic and diluted ($0.07) ($0.04) ($0.08) ($0.09) Weighted average shares - basic and diluted 23,019 22,766 22,982 22,759 AWARE, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands) June 30, December 31, 2005 2004 ASSETS Cash and investments $38,748 $38,266 Accounts receivable, net 1,926 3,070 Property and equipment, net 8,133 8,287 Other assets, net 638 560 Total assets $49,445 $50,183 LIABILITIES AND STOCKHOLDERS' EQUITY Total current liabilities $1,976 $1,427 Total stockholders' equity 47,469 48,756 Total liabilities and stockholders' equity $49,445 $50,183