Financial Statements, dated February 3, 2005

EX-99.3 4 dex993.htm FINANCIAL STATEMENTS, DATED FEBRUARY 3, 2005 Financial Statements, dated February 3, 2005

Exhibit 99.3

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Condensed Consolidated Statements of Operations

(In thousands, except per share data, unaudited)


	Three Months Ended						Nine Months Ended
	October 29, 2004			October 31, 2003			October 29, 2004			October 31, 2003
Revenues
License fees	$	7,653		$	5,687		$	13,515		$	30,578
Services		18,375			19,672			62,294			60,075

Total revenues		26,028			25,359			75,809			90,653
Cost of revenues
Cost of license fees		33			19			159			128
Cost of services		14,743			14,078			48,949			38,887
Amortization of purchased developed technology		665			665			1,995			1,995

Total cost of revenues		15,441			14,762			51,103			41,010

Gross margin		10,587			10,597			24,706			49,643

Operating expenses
Research and development		10,095			8,273			27,585			22,422
Sales and marketing		11,483			10,677			34,769			33,698
General and administrative		5,473			3,926			14,597			10,354
Stock option compensation (benefit) charges		—			3,000			(7,338	)		33,840
Restructuring (benefit)		(867	)		—			(841	)		—

Total operating expenses		26,184			25,876			68,772			100,314

Loss from operations		(15,597	)		(15,279	)		(44,066	)		(50,671	)

Interest and other income (loss), net		(1,289	)		860			(1,881	)		831

Loss before income taxes		(16,886	)		(14,419	)		(45,947	)		(49,840	)
Provision (benefit) for income taxes		288			765			(258	)		2,000

Net loss	$	(17,174	)	$	(15,184	)	$	(45,689	)	$	(51,840	)

Loss per share
Basic and diluted net loss per share	$	(0.40	)	$	(0.39	)	$	(1.08	)	$	(1.40	)

Shares used in computing basic and diluted net loss per share		42,609			38,995			42,444			36,937

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Pro Forma Condensed Consolidated Statement of Operations

Excluding Amortization of purchased developed technology, Stock option compensation,

Restructuring and Impairment of assets

(In thousands, except per share data, unaudited)


	Three Months Ended						Nine Months Ended
	October 29, 2004			October 31, 2003			October 29, 2004			October 31, 2003
Revenues
License fees	$	7,653		$	5,687		$	13,515		$	30,578
Services		18,375			19,672			62,294			60,075

Total revenues		26,028			25,359			75,809			90,653
Cost of revenues
Cost of license fees		33			19			159			128
Cost of services		14,743			14,078			48,949			38,887

Total cost of revenues		14,776			14,097			49,108			39,015

Gross Margin		11,252			11,262			26,701			51,638

Operating expenses
Research and development		10,095			8,273			27,585			22,422
Sales and marketing		11,483			10,677			34,769			33,698
General and administrative		5,473			3,926			14,597			10,354

Total operating expenses		27,051			22,876			76,951			66,474

Pro forma loss from operations		(15,799	)		(11,614	)		(50,250	)		(14,836	)

Interest and other income (loss), net		211			860			(381	)		831

Pro forma loss before income taxes		(15,588	)		(10,754	)		(50,631	)		(14,005	)
Provision (benefit) for income taxes		(288	)		(765	)		258			(2,000	)

Pro forma net loss	$	(15,876	)	$	(11,519	)	$	(50,373	)	$	(16,005	)

Items excluded from pro forma net loss
Stock option compensation benefit (charges)		—			(3,000	)		7,338			(33,840	)
Amortization of purchased developed technology		(665	)		(665	)		(1,995	)		(1,995	)
Restructuring benefit		867			—			841			—
Impairment of assets		(1,500	)		—			(1,500	)		—

GAAP net loss	$	(17,174	)	$	(15,184	)	$	(45,689	)	$	(51,840	)

Pro forma loss per share
Pro forma net loss per share	$	(0.37	)	$	(0.30	)	$	(1.19	)	$	(0.43	)

Shares used in computing pro forma net loss per share		42,609			38,995			42,444			36,937

GAAP loss per share
Basic and diluted net loss per share	$	(0.40	)	$	(0.39	)	$	(1.08	)	$	(1.40	)

Shares used in computing basic and diluted net loss per share		42,609			38,995			42,444			36,937

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Condensed Consolidated Balance Sheets

(In thousands)


	October 29, 2004			January 30, 2004
	(Unaudited)
Assets
Current assets
Cash and short-term investments	$	57,023		$	82,903
Accounts receivable, net		16,511			29,749
Restricted short-term investments		1,133			2,557
Deferred contract costs		4,084			103
Prepaid expenses and other current assets		3,763			3,926

Total current assets		82,514			119,238
Property and equipment, net		19,971			20,848
Purchased developed technology, net		—			1,995
Restricted long-term investments		13,051			13,164
Other assets		1,162			2,910

Total assets	$	116,698		$	158,155

Liabilities and Stockholders’ Equity
Current liabilities
Accounts payable	$	10,538		$	5,390
Accrued employee benefits		9,653			8,829
Current portion restructuring costs		9,843			9,193
Other accrued liabilities		14,095			12,870
Current portion of long-term debt		96			96
Deferred revenue		37,145			28,891

Total current liabilities		81,370			65,269

Long-term accrued restructuring costs		9,675			18,791
Long-term notes payable and other liabilities		1,560			1,564
Long-term deferred revenue		2,660			—

Total liabilities		95,265			85,624

Stockholders’ equity
Common stock		43			42
Additional paid-in capital		613,487			618,966
Accumulated other comprehensive income (loss)		(623	)		(647	)
Notes receivable from stockholders		(15	)		(61	)
Accumulated deficit		(591,459	)		(545,769	)

Total stockholders’ equity		21,433			72,531

Total liabilities and stockholders’ equity	$	116,698		$	158,155